Between universal service and what it costs. The European Commission's reticence to finalise its proposal on a new phase of liberalisation of postal services proves in itself that Europe does not yet have a well-defined doctrine for "general interest services". And this is understandable, as there is perhaps no field where the positions and traditions of Member States are further apart and where, at the same time, the impact on the life of citizens is more direct and immediate. One just has to think of the production and distribution of electricity or water, the railway, postal services, telephone services or telecommunications in general. It is quite normal that Europe should not take this kind of thing too lightly.
The situation has, of course, developed in a favourable way over the past ten years, since the time when government did not understand each other because of different terminology used and the apparently irreconcilable national positions. Things have become a great deal clearer and there has been considerable reconciliation, as proved by the significant openings on markets which, at the time, were subject to rigid monopoly situations. The results, in some cases, have been so positive for the European economy that the timeliness of breaking with some of these rigid positions is no longer challenged. The doctrinary divergences have not been overcome but partially smoothed out by compromises, fixing liberalisation percentages, stages to be overcome and sometimes limits to cross. But each new large-scale initiative causes distrust: it appears too timid for those who consider that the exclusive rights of former monopolies hamper the fulfilment of the potential of the European economy, while others have the impression that the obligation of ensuring that all citizens enjoy essential services is guaranteed.
Divergences will never be overcome without an effort of mutual understanding, because each of the two positions has valid arguments to back it up. This is quite a rare case, and the presentation made of it determines the attitudes to be taken. Black or white: this is how the two theses appear when one prefers manichaeism to dialogue.
A. In favour of dismantling state monopolies and exclusive rights, for opening markets up to competition. Former monopolies had a real strangle-hold on the economy, because of their cost and often their ineffectiveness. Without competition, the functioning of such monopolies was sometimes deplorable. Think of the postal services in Italy (Milan companies used to send mail from abroad to Switzerland, preferring to organise a daily shuttle service from Milan to the Swiss border, rather than trust the national postal services), or the delays that were necessary in the past for having a telephone installed in Paris. The annual deficits of the railway are a tremendous burden in some Member States on national budgets. Wastage by some public companies was hallucinating - at any rate, the State footed the bill. In several cases, monopolies were used by political parties to place their pawns in the nerve centres of power, or quite simply, to shower favour on friends. Since some general interest services have been liberalised, prices have fallen sometimes spectacularly to the advantage of companies and citizens as a whole.
B. In favour of the role of the State and safeguard of "universal service". When, at the beginning of the last century and early this century, technical progress had made railway networks possible, like electrical networks and telephone networks, the States intervened in order to make them available to all citizens. The large part of the population still did not have the right to vote and workers had not yet organised themselves into powerful trade unions. The "State feeling" was sufficient for railway companies to cover the whole of the territory, right up into the most inaccessible mountainous areas, and the electricity lines created new landscapes for taking electricity to the most isolated villages. A fundamental element was that the awareness of general interest allowed governors to fix uniform prices: for users, a kilometre by rail costs the same whatever the lie of the land to be travelled over. A letter cost the same to send whether it was to be despatched just a few hundred yards or to the most outlying village at the top of a mountain lost in the clouds. With the "what it really costs" criteria, full regions in our countries would not have enjoyed the advantages of rail, electricity or telephone; with private investment criteria, dozens of companies would serve the Paris-Lyons, Rome-Milan or Dusseldorf-Cologne line, but who would serve the less profitable lines? Service to citizens - that was what yesterday's States prided themselves in. It is a principle that should be safeguarded or re-established, if it has fallen into disuse.
One can understand by this little game of "two theses" that there is no lasting solution if only one of the two positions is taken into consideration. Europe's equity and interest mean account should be taken of both. The system of compromises has allowed progress to be made but it is no longer sufficient. Compromise, that means in general that, if a country wanted to move forward to 100 and another wanted to stop at 50, then it is 75 that would be taken on board. The first says: this is a first step While the second says: this is a maximum beyond which we shall not go.
It is relatively simple to establish principles. But all attempts to establish a "code of public services" have failed. Objectives are set out, since Karel Van Miert's preface to the "Dictionary of Public Services in Europe", established by ISUPE, an initiative group for public utility services in Europe (1), a body which has done some very good work, for example, for clarifying concepts and terminology. But it has never been possible to develop something truly operational which has been considered as acceptable by all parties, that is, not only governments in favour of completely free competition but also governments which defend what they consider as a significant part of the national heritage; workers trade unions and employers; private companies and public or semi-public organisations. The European Commission should organise within itself a true debate on giving concrete substance to such principles, before deliberating on them case by case. And does not the European Parliament consider it would be its role to seek a European road representing the synthesis of national experiences and traditions, in the light of the most recent developments?
When "acquired rights" constitute abuse. Several main principles reached may be easily summarised. The first is that a general interest service may be entrusted not only to a public company but also to a private company. What is important is not the legal nature of the firm but the obligations it must subscribe to and comply with, mainly regarding universal service. The second principle concerns the quality of services. Companies charged with general interest services must undertake to respect a sort of "code of conduct" linking them to users, which guarantees service quality (the ISUPE mentioned above agrees with this). The third principle concerns compensation, by the State, of public service obligations which involve additional responsible (but how should this be assessed, in an objective and equitable manner?). One must go still further, towards balanced definition of rights and duties, mainly with regard to the users. It is not enough to decide, in theory, that the universal service must be guaranteed. One must also establish the rule that the network must not decline, that it must maintain its magnitude, as degradation would come with reduction. At the same time, public service workers must not cling to the principle of "rights acquired" in order to keep the advantages which are no longer justified. Retirement at 55 for railway workers in France was justified at a time when life expectancy was far shorter, the working week considerably longer and when, above all, the work of train drivers was not only unpleasant but dangerous, with long hours in the coal dust. Today, retirement at 55 means retirement with discrimination to the detriment of all other workers.
The European Commission should therefore endeavour to establish a "public services doctrine in Europe" instead of continuing to deliberate on a case by case basis. The aim is obviously not to make legislation uniform or to rub out the differences and traditions which have their roots in the mentality and the history of each people, but to allow the harmonious working of the single market without borders and to guarantee effective services to companies and citizens in Europe. It is high time that the European Institutions tackle this problem very seriously, because the cost and the availability of energy or water, transport efficiency, and the speed of telecommunications has an influence on and can even determine the competitiveness of the European economy and the daily life of the whole population.
Ferdinando Riccardi
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(1) "Public service seems to me to be an essential element in the construction of a Community founded on the values of solidarity and equal access, for all citizens, to a certain number of common capital goods, seen as essential. To fully achieve these objectives, public services should be modernised and adjusted to the requirement of an open and dynamic market economy (…). The idea at the heart of our ambition for Europe is to pass on to our young people a Community that is of course more modern and competitive but also more united and more humane". Karel Van Miert, Preface to "Dictionnaire économique et juridique des services publics en Europe", Editions Aspes Europe, Paris 1998.