CGIL Congress (Italian General Confederation of Labour - Italy)

Palermo, 18/01/2006

To be checked against delivery

I am grateful to the CGIL for the opportunity to visit Palermo and Sicily, to come to one of Europe's great crossroads, and to address you today on taking Europe's forward.

2005 was a bad year for Europe. A few years ago, the Queen of England reflecting on the bedroom antics of her children, said that the year in question had been an “annus horribilis”. Well 2005 was such an “annus horribilis” for the European Union.

There were several reasons:

First, high unemployment and slow growth continue in the main continental economics and that in turn is accompanied by increased pressures on social security budgets and public spending. Trapped by the Stability and Growth Pact, Governments are not able to act counter-cyclically and expand demand. The Lisbon Strategy in most countries has been going nowhere.

Second, the French and Dutch people voted against the proposed EU constitution. 13 other countries, including Italy, endorsed it, but, for it to come into effect, endorsement needs to be unanimous. The result is an EU scratching its head wondering what to do next.

Third, it is clear that one of the reasons for the French rejection was the fear of French people, partly caused by EU enlargement, that jobs are emigrating to cheaper countries in Europe and Asia - the process of delocalisation - and that people are immigrating from outside EU - 15 prepared to work on lower terms than those built up in the post war period.

These remain major issues in many established EU countries.

Fourth, there were attempts by some Governments, including my own in the UK, - and some in the Commission - to argue that Europe does not have one Social Model but 25 different ones, with the implication that it should not have social policy functions.

Those who argued this way ignored two facts. First if Europe has no developing social policies, then what kind of Europe is it? A business Europe? A huge single market with no safety nets, no protections as social systems compete with each other to be the cheapest and most entrepreneur friendly.

That kind of Europe will not get - and does not deserve to get - worker and trade union support.

It is the kind of thinking which led to the ill-constructed Bolkestein Directive which has so mobilised trade union discontent across the EU. Incidentally there will be a big demonstration in Strasbourg on February 14 and I hope to see a strong Italian trade union contingent there.

The other fact ignored by those arguing that there is no scope for expanding Social Europe should be blindingly obvious - and how some clever people have missed it is astonishing. No European Social Model, they argue. But what about the fundamental provision of free movement of labour across the EU? This is a huge social measure - a good measure in my view - but the terms on which it is done necessitate clear policies at the EU level.

At the moment we do not have clear enough policies, as is evident in the Vaxholm and Viking cases in Sweden and Finland respectively. I repeat - workers and unions in Europe will not support a race to the bottom with competing social (and tax) systems dragging down standards through social and fiscal dumping.

So these are tough days for Europe - and tough days for European trade unionism. But we don't give up on Europe. We will never give up on our Europe.

As a peace process it has been a wonderful success as ancient rivalries and conflicts, if not forgotten, are laid to rest and replaced by co-operation.

Enlargement is carrying peace and stronger democracy, and all that goes with it, eastwards, and countries which had a bad time of it in the post-war period are growing quickly, if sometimes painfully. Western companies, by the way, are benefiting too from the new member states.

And our peace process is not just looking into the EU borders. Mediterranean countries are extremely important in our vision. No European Social Model could exist without a new vision of external relation. That's why ETUC has created an important platform to better communicate and involve our trade union colleague from Mediterranean Countries and to push European Institutions to support a strong Euromediterranean policy. But this of course needs two important instruments: political will and financial resources.

The recent EU budget settlement is welcome even if, in my view, and that of the European Parliament, it is not enough. At least, the member states could agree on something, and there are signs that economic growth is starting to move up although there are still worryingly high levels of unemployment.

And late last year in debates on Social Europe we made some progress in reviving the idea of more Social Europe - not enough progress but at least some. We are still confronted at every time, including by left-of-centre governments by an argument which is almost a mathematical equation. That is - regulation equals lower growth, lower competitiveness and higher unemployment.

We don't accept this argument. And we quote the success of the Nordic economies in combining high social standards and powerful collective bargaining with good economic performance.

These are our key struggles and challenges. The CGIL, CISL and UIL play a central part in the ETUC and invest heavily in our work. Sometimes we disagree; sometimes we can't persuade other nations to show the same degree of European spirit on matters like a common collective bargaining strategy - a dossier being pursued by my good colleague Walter Cerfeda, himself a former CGIL officer.
We work together for the workers of Italy and of Europe. Long many that close and productive relationship endure.

This is an important year for CGIL. I hope to join you at the national Congress in the Spring and I am following your debates with great interest. As an admirer of the Italian trade union way of working in the community as well as at the workplace. - I was very impressed by a recent Unita festival in Terni - there are wider lessons from Italy which can inform and help unions in other countries to develop.

May your success continue. Thank you for your support. Best wishes to CGIL for the future.