19th Apr 2018

EU leaders agree to protect Europe's social model

EU leaders meeting in Brussels on Tuesday have agreed on a carefully worded compromise concerning the controversial proposal to liberalise the services market.

To appease both supporters and detractors of the directive, the wording of the conclusions at the end of the summit on Wednesday is to say that while the EU supports a complete opening of the market in services, the European Social model has to be protected.

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Luxembourg Prime Minister and current head of the EU, Jean-Claude Juncker, said that the current draft does not fully meet those requirements.

He added that the directive would not be withdrawn as this would give the impression that opening the services market had "dropped off the agenda altogether" but he stressed that "changes will be made to take the social model into account".

"Nobody can sensibly dispute the fact that we need to open up the services sector in Europe ... but it must be done with respect for certain sensitivities and convictions", said Mr Juncker.

European Commission President José Manuel Barroso said, "We have achieved in our debate an important consensus".

He said withdrawing the directive - which is the prerogative only of the European Commission - would go against the wishes of both the European Parliament and the council.

This puts the ball firmly in the court of the European Parliament which is due to finalise its report on the directive before the end of May – and before the French referendum on the Constitution.

The French debate on the Constitution has become embroiled in popular fear about the directive leading to concerns that this could result in a no in the referendum.

However, member states are split on their support for the directive.

Some member states – particularly from eastern Europe but also the UK and Ireland – support the directive as they believe it will create thousands of jobs.

But opponents of the directive, mainly France and Germany, say that it will lead to a reduction in wages and working conditions - particularly due to the 'country of origin' principle, which enables service providers to operate anywhere in the EU under their own domestic rules.

France against

The move by governments came after French President Jacques Chirac told his colleagues on Tuesday that the text is "unacceptable for France as it is for other social partners" and called for it to be re-written.

Mr Juncker, who earlier said that the Luxembourg Presidency is for liberalisation of the services market but against social dumping, added that he wants to be able to tell his citizens that "that this directive means ABC".

This is in reference to the confusion that has arisen from the current draft.

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