Modernizing the European
social model
Europe has set itself the goal of becoming
the world's most dynamic economic region by the end of the decade. It has made significant
progress via the Lisbon Process and is poised to enjoy the vast economic potential of EU
enlargement. The economic upturn, which is gradually taking hold, bolstered by the
threefold approach of structural reforms, cyclical stimuli and consolidation of public
finances in the member States, forms a good basis for further progress.
At present, in the context of demographic
slowdown, growth and productivity in Europe remain too weak: The members of the EU too
often fail to maximize the benefits of outstanding European research; Too often, barriers
are placed in the way of realizing Europe's entrepreneurial potential; The more people we
have in work, and the better their skills, the higher growth will be. We are indebted to
the Employment Taskforce, chaired by Wim Kok, for heightening awareness of these simple
truths.
Member States now need to focus on the key
issues of innovation as a force to promote enterprise and the reform of product and labour
markets. A further priority has to be modernizing the European social model characterized
by the workforce broadly sharing in the values and decisions of our societies, according
to national traditions. A more innovative and employment-intensive economy will help us
preserve our social protection systems for future generations. At the same time these
systems need comprehensive reform to guarantee their long-term affordability, given the
demographic trend.
For a more innovative Europe
With investment in research and development
(R&D) at 2% of GDP, Europe is still far from its strategic goal of 3%, two thirds of
which must come from the private sector. The European Growth Initiative adopted in
December has to be geared more to industrial R&D projects focused on key growth
technologies such as life sciences, nano technologies, communications technologies, energy
technologies and environmental technologies. In this framework the EIB has to play a key
role. Europe should also continue to participate in projects such as ITER and space
systems research. Investment in R&D is only one part of the innovation process.
Equally critical to success is the ability of business to transform research initiatives
into commercially viable processes and products. In addition, to strengthen the
knowledge-based economy, universities and European research centres will have to be
encouraged to establish closer links with a view to forming high-level centres of
education and research capable of competing at global level. The European Framework
Research Programme has to be simplified to make it more user-friendly for industry and
science. The priorities should be to promote cooperation between business and research and
develop the technologies of the future. Support for basic and applied research has to be
strengthened. In this context, we will examine with interest, the Commission's proposals
for the future structure of European research, including a possible European Research
Council.
The European framework of intellectual
property has to be improved.
The Commission should work closely with the
member States and industry to revise the technology transfer block exemption regulation.
The Commission and the member States should systematically assess the impact of draft
legislation on the ability of companies to innovate and compete. In addition, the
Commission should draw up a timetable with clearly-defined goals with a view to abolishing
the regulations and bureaucracy which unduly hamper competitiveness and innovation. The
member States have to be able to support innovation more effectively. Member States also
need the flexibility to develop effective interventions to support enterprise as the EU
venture capital market evolves. Particular account must be taken of the problems of
innovative small and medium-sized enterprises, and new ways of helping micro-enterprises.
Improved support for long-term high-risk research also deserves special attention.
The promotion of enterprise is a vital
element in delivering sustained employment and productivity growth. Enterprise and
entrepreneurship play an important role in ensuring the efficient allocation of capital
and, through start-ups and developing businesses, in generating new jobs. The creation of
new businesses increases the competitive pressure on firms, generates new ideas and
innovative approaches and can lead to greater choice and services for consumers. The
regulatory framework, at European and member-State level, must promote and not inhibit
enterprise. Action is required by member States and at the Community level to modernize
the regulatory framework to provide the best possible opportunities for entrepreneurship
and competitiveness. At the EU level, member States should commit not to consider any
proposals not accompanied by an adequate impact study, and
"competitiveness-proofing" should be developed. To improve existing legislation,
the Council and Commission should set a clear timetable for improving the current European
regulatory framework. Member States should act to improve their own regulations. To
promote pro-enterprise policies and to celebrate success in enterprise across the Union,
the Commission should bring forward proposals to establish a competition to identify
"European Centres of Enterprise".
For more employment in Europe
The report drawn up by the Kok Taskforce
makes clear that urgent action is needed if Europe is to reach the Lisbon target of a 70%
employment rate by 2010 and ensure its prosperity and its social model in the long term.
We very much welcome the concrete specific recommendations for action in the report. These
will give a much-needed boost to the European Employment Strategy. At the forthcoming
spring Council, all member States should commit to urgent and relevant action in the light
of these recommendations, and stepping up the exchange of best practice.
The quality of our human capital has to be
further improved through better education and continued promotion of the principle of
lifelong learning.
We need to modernize employment services in
the member States so that these effectively meet the needs of both jobseekers and
employers. Job hunting and advice services have to be available at an early stage to
prevent unemployment. By lending support, while demanding matching efforts in return, the
services provided through an active labour market policy have to be more strongly geared
to the individual needs of the unemployed and inactive people of working age. We have to
focus on providing appropriate incentives for people to remain longer in work and for
employers to recruit and retain older workers. The success of these reforms supposes a
high involvement of the social partners at every level.
Modernizing the European social model
No one must be excluded from societal life
due to serious illness, long-term inability to work, family circumstances or age. The best
way to ensure this at EU level is through the exchange of best practice, so that all can
use the best possible techniques depending on the specific situation obtaining in each of
the 25 member States. Europe is currently faced with a demographic slowdown and an ageing
population. This situation is troubling and calls for an urgent response. Comprehensive
support for families can improve the demographic pattern in the long term. An improved
system of childcare for working parents can increase the employment rate, particularly
amongst women. The demographic trend necessitates fundamental reform to maintain our
pension systems. To secure pensions, we need more people in employment.
In an EU of 25, to prepare for the future, we
need to have the best possible mechanisms for achieving the EU's goals. The policy we have
outlined extends well into the period of the next EU financial framework. It can be
financed using no more than 1% of EU GNP as it is essentially a matter of improving the
business environment and ensuring a better allocation of resources. We welcome the
initiative of the Irish and the three subsequent presidencies on the reform of the
regulatory framework in Europe as a means of achieving our goals on growth. Similarly, as
a means of helping achieve our goals on growth, we call for the appointment of a
Vice-President of the Commission to focus exclusively on economic reform. This person
would push ahead with the Lisbon Agenda and coordinate the work of Commissioners whose
portfolios are particularly important for its realization. The Vice-President should have
a voice in all decisions on EU projects which impact on the targets of the Lisbon Agenda.
We hope that the European Council will take up our approach of setting clear priorities to
achieve the Lisbon targets including those of sustainable development. Growth remains the
key to achieving our goals for a dynamic, employment-rich and thus social Europe. We
invite the members of the European Council to submit further proposals with this in mind
on 25-26 March 2004. Our Ministers, who have spelt out our ideas in greater detail in
three working papers, will present our proposals at meetings of the relevant specialized
Councils. We are sending a copy of this letter to our colleagues in the European Council
and to the heads of government of the ten new member States.
Joint letter from m. Jacques Chirac,
President of the republic, Mr. Gerhard Schroeder, chancellor of the federal republic of
Germany, Mr. Tony Blair,Prime Minister of the united kingdom of great Britain and northern
Ireland, to Mr. Bertie Ahern, President in office of the European council and Mr. Romano
Prodi, president of the European commission (Paris, Berlin, London, 18 February
2004) |
