Strasbourg, 13/12/2006 (Agence Europe) - Meeting in Strasbourg on Tuesday, the College of Commissioners adopted the Commission's annual report on economic reform in Europe as part of the revised Lisbon Strategy - or Partnership for growth and employment - which was based on the 25 Member States' autumn reports and which will be submitted to the European Council in March 2007. While acknowledging undeniable progress in the implementation of National Action Plans (NAPs), José Manuel Barroso nonetheless called on the Twenty Five not to let up in their efforts and to “seize this opportunity presented by the improvement in economic prospects to speed up the pace of reform”.
While noting in particular the efforts made over the past year which have encouraged R&D and innovation, improved regulation and the economic environment, especially that of SMEs, and ensured the financial sustainability of the administrations in charge of retirement and health systems, the main conclusions of the report, nevertheless, are critical of the fact that the little competition on several markets, particularly network services, including energy, continues to slow Europe. Results for the labour market are balanced. While employment is rising and unemployment declining, the growing consensus on “flexicurity” is a very positive development, but one which remains to be fully transposed, stresses the Commission. It also believes the Union is not progressing quickly enough on settling related problems of rigidity of the labour market and segmentation among workers (limited duration contracts and high level of social protection/limited duration contracts and little chance of a permanent contract).
The annual progress report also takes stock of the implementation by Member States of commitments made by the spring 2006 European Council in four priority areas. In the area of knowledge (teaching, R&D and innovation), it welcomes the enhanced commitment to R&D show by the Twenty Five, but says a more strategic approach must be taken for innovation, based on the consensus at the informal European Summit in Lahti in October. On the economic environment, the report highlights the reasonable progress in putting in place “one-stop shops” for quickly setting up new companies, in the measures making it easier to take on a first employee, and in the promotion of an enterprise culture in education. In addition, the report calls on the European Council to agree that all Member States reduce the administrative burden on companies by 25% by 2012, based on proposals the Commission will bring forward in January. Finally, the report announces a systematic examination by the Commission of how well essential goods and services markets work. With regard to labour markets, the Commission notes somewhat limited progress up to this point. It intends to bring forward, by next summer, a raft of common principles from which Member States could develop their “flexicurity” policies in line with their own specific situations. In the area of sustainable energy, the report stresses the huge human and economic cost of climate change, the importance of the strategic energy assessment, the review of the emissions trading system, the completion of the internal energy market, the development of renewables and changes in the way companies and citizens behave to save energy.
Formal recommendations by the Commission by Member State (the countries for which no formal recommendation was made to the European Council are not mentioned)
Germany: improvement in the long-term sustainability of public finance (tax consolidation, debt reduction and implementation of reform of the health system), strengthening of competition on the goods and services markets and tackling of structural unemployment in order to ensure better integration of unqualified workers on the market through better access to qualifications and better services for youth and long-term employment.
Austria: improvement in encouraging older active people to work and in qualifications for young vulnerable working persons through a life long learning strategy.
Belgium: pursuit of efforts to reduce work taxation and to consolidate the budget, and to adopt new measures to reduce regional variations in unemployment.
Cyprus: reform of retirement and health systems, putting in place a life long learning strategy and increasing employment and training opportunities for young people.
Spain: taking new measures to increase competition in the energy sector and improve cross-border interconnections; modernisation of the job protection system, combating segmentation of the labour market and increasing the attractiveness of part-time working; - ensuring the implementation of education system reform at national and regional levels to reduce disaffection with schools and increase the response capacity of the training system to the needs of the labour market.
France: - continuation of efforts to improve public finances (budgetary consolidation, debt reduction and reform of the pensions systems); take measures to enhance competition on gas and electricity markets and freight on the railways; modernisation of job protection systems, reinforcement of life long training and fighting against segmentation of different kinds of labour market contract.
Greece: - continuation of efforts to improve public finances (budgetary consolidation, debt reduction) through implementation of reforms to the pensions system and implementation of sustainable tax system; modernisation of public administration by putting in place efficient regulation and control measures ensuring efficient use of structural funds; modernisation of employment protection, reduction of tax wedge on work and strengthening of active employment policies for promoting flexibility an security on the labour market and transforming work off the cards into declared work; increase in investment in higher education, implementation of life long training strategy, improvement of capacity in training system's response to needs of the market by reducing numbers leaving school early.
Hungary: - implementation of necessary measures for ensuring a credible reduction in the public deficit and public debt by reducing public spending, reforming the public administration (education, pensions and health) and strengthening active employment policies.
Italy: - continuation of tax consolidation process for reducing the public debt and implementing reforms to the pension system in order to improve long term public finances, increase competition on goods and services markets, reducing regional disparities in employment, particularly by tackling undeclared work and developing a life long training strategy.
Latvia: - maintaining economic and budgetary sustainability by pursuing a more restrictive tax policy; increase reforms involving R&D and innovation to increase number of job offers by promoting regional mobility; implementation of life long training strategy.
Lithuania: - continue efforts involving R&D, notably by increasing public spending and increasing efforts to increase number of qualified jobs on offer by promoting regional mobility; implementation of life long training strategy.
Malta: - taking measures to strengthen the competition authorities' powers, reducing state aid and reorientating horizontal objectives, particularly for R&D, increasing efforts to attract more people onto the labour market, particularly women, discouragement of non-declared work and make work more attractive.
Netherlands: - take measures to improve number of jobs, particularly for women, elderly women workers and disadvantaged groups.
Poland: - continuation of tax consolidation process particularly by containing public spending; improving competition in network industries and financial sector; boost to R&D and innovation; pursuit of reforms in public research sector and make conditions for attracting DIB more attractive in the medium and high technology sectors; improvement in active policies for jobs covering a vast range of unemployed, particularly young and elderly workers; reduction of tax burden and revision of allocation systems and improvement in incentives to work; development of life long training strategy and modernisation of education system.
Portugal: - redirection of public spending towards uses that give more support to growth while maintaining firm control on public spending; implementation of measures to improve the level of education for young people and developing a vocational training system tailor made to labour market needs; modernisation of employment protection system.
Czech Republic: - improvement of public finances' sustainability (reform of pension and health systems), stimulate collaboration between public and private R&D sectors and modernisation of employment protection system.
United Kingdom: - enhancing basic and intermediate competencies for working population in effort to increase productivity and improve employment prospects for disadvantaged groups.
Slovakia: - redirect public spending towards R&D and training and complete national innovation strategy by strengthening links between research institutes and private sector; improvement of life long training and qualifications, completion of education system reforms; implementation of specific approach for tackling long term unemployment through employment policies targeting the most vulnerable groups.
Slovenia: - take new measures to reform pensions system and promote work among the elderly and improve employment services. (eh)