Amsterdam summit agrees new draft Treaty

The Amsterdam European Council summit meeting concluded on 17 June with the agreement of a new draft Treaty. We outline the contents and some initial reactions to the draft text, which is due to be signed in Amsterdam in October 1997.

The European Council meeting in Amsterdam on 16 and 17 June 1997 concluded the Intergovernmental Conference (IGC) with the agreement of a new draft Treaty. The conclusion of the IGC leaves the path open for launching the enlargement process, and the timetable for the single currency has equally been reaffirmed. Economic stability, growth and employment also featured prominently in talks between the governments of the 15 member states. Reinforced by the participation of members from the two new left-of-centre governments of France and the United Kingdom, the European Council agreed to give fresh momentum to keeping employment firmly at the top of the European Union's agenda.

The social and employment aspects of the new Treaty

Among the various draft Treaty amendments, the following are of key importance to European industrial relations.

  • The inclusion of a new"employment chapter"in the new Treaty. A "high level of employment" will now be an objective of the EU, while the new title on employment commits the member states and the Community to developing a coordinated strategy for employment and promoting a skilled, trained and adaptable workforce, and labour markets responsive to economic change. Member states will promote employment and coordinate their action, while the Community will encourage cooperation and, if necessary, complement this action. Annual employment reports and policy guidelines will be drawn up, while the Council may adopt incentive measures (excluding harmonisation) to encourage cooperation among member states and support their action.
  • The integration of the social policy Protocol into the body of the Treaty. The decision by the UK's new Labour Government to "opt in" to the "social chapter"opened the way for the inclusion of the Maastricht social policy Protocol and Agreement in the Treaty. Essentially this means the incorporation of the text of the social policy Agreement in the Treaty's social policy chapter, creating a single set of provisions for all member states.
  • New measures against discrimination and for equality. The EU's aims will now include promoting "equality between men and women", and its activities will aim to eliminate inequalities, and to promote equality, between men and women. Furthermore, the Council may now take appropriate action to combat discrimination based on sex, racial or ethnic origin, religion and belief, disability, age or sexual orientation.
  • Recognition of social rights. The general principles underlying the Union will now include attachment to fundamental social rights as defined in the Council of Europe's European Social Charter and in the Community Charter of the Fundamental Social Rights of Workers.

Other elements of the Treaty

The Treaty establishes a new section on freedom, security and justice. These include issues such as free movement of people, external border controls, asylum and immigration; and measures to combat crime. Many of these areas require unanimous agreement, and maintain special arrangements for the UK and Ireland.

Treaty provisions on the environment have been strengthened, but little progress was made on institutional reform, apart from a modest increase in qualified majority voting. The new Treaty also includes a revised section on common foreign and security policy, strengthens Treaty measures on public health and consumer protection and arrangements on subsidiarity and transparency clarified.

Other European Council decisions

In preparation for the third stage of Economic and Monetary Union (EMU), the European Council agreed two Resolutions that form part of the stability pact, designed to ensure budgetary discipline in EMU. A Resolution on the stability and growth pact reinforces the member states' commitment to the achievement of the monetary requirements set out in the convergence criteria and the stability pact. The main elements of a new exchange rate mechanism and most of the technical preparations for EMU were also agreed. A Resolution on growth and employment seeks to emphasise the commitment of the Union to keep employment and the creation of favourable conditions for economic growth and new job opportunities at the top of the agenda.

An extraordinary Council meeting on employment is to be held under the Luxembourg Presidency of the second half of 1997. One of the key aims of this meeting will be to review the implementation of initiatives concerning the job-creation potential of small and medium-sized enterprises, and the study of good practice in employment policies in the member states.

The European Council expressed its support for the single market action plan drawn up by the European Commission. The action plan aims to realise the full benefits of the single market by ensuring the removal of remaining obstacles. The European Council asked the Commission to report on progress later this year and called for wider action to simplify Community legislation.

On the issue of enlargement, the Council welcomed the Commission's intention to present by mid-July its Opinions on the accession applications, as well as a comprehensive Communication (Agenda 2000) on the development of EU policies in relation to enlargement.

Initial reactions to the draft Treaty

Initial reactions to the new draft Treaty by the social partners were muted. François Perigot, president of the Union of Industrial and Employers' Confederations of Europe (UNICE) argued that: "Substantial progress has been made along the road to Economic and Monetary Union, which we welcome, but we also note that a great deal remains to be done to equip the European Union with the means it need to tackle enlargement."

In a press release of 18 June, UNICE welcomes the confirmation by the Amsterdam Council that the single currency would be introduced as planned. It also approves the Resolutions on stability, growth and employment, but is keen to underline its concern that measures introduced under the new employment chapter be inspired by the Presidency conclusions, eg concerning the relieving of tax pressure, the reduction of non-wage labour costs and an increase in labour market flexibility.

The European Trade Union Confederation (ETUC) sees Amsterdam as a "minimalist" solution to the dilemma facing European labour markets. It is particularly concerned that the balance between economic and monetary considerations and employment has, in its view, not been redressed by the Resolution on growth and employment, or the introduction of the new title on employment into the Treaty. The integration of the social policy Protocol is welcomed, but it is argued that without a substantial extension of qualified majority voting, few significant advances can be made in the area of social policy.

In summing up the outcome of the Amsterdam summit, José-María Gil-Robles, President of the European Parliament, welcomed the introduction of the employment chapter and the incorporation of the social policy Protocol into the Treaty. He also gave a favourable assessment of the inclusion of measures to promote equality between men and women and to combat social exclusion, but expressed regret at the exclusion of specific measures to help elderly and disabled people from final draft.

The final legal editing and harmonisation of the texts will now be completed with a view to signing the Treaty in Amsterdam in October 1997.

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