Committee Reports > List of Committees > Joint > 1986 > Committee on the Secondary Legislation of the European Communities (4th Committee) > Report No. 34 - Single European Act

REPORT

A. INTRODUCTION

Amendment of Community Treaties

1.The initiative for revision of the Treaties [European Coal and Steel Community (ECSC), European Economic Community (EEC) and European Atomic Energy Community (EAEC)] establishing the European Communities rests with the government of any Member State or the Commission who may submit to the Council of Ministers proposals for the amendment of the Treaties. The procedure for amendment of the Treaties is set out in Article 236 of the EEC Treaty and corresponding Articles of the other Community Treaties. The sovereignty of Member States is safeguarded through the stipulation that amendments must be passed by a unanimous conference of representatives of their Governments, and ratified by all the Member States in accordance with their respective constitutions. Therefore, changes in the structure of the Community is subject to the common will of the Member States.

2.The Single European Act (SEA) is the outcome of the Conference of the Representatives of the Governments of the Member States of the European Communities. The Inter-Governmental Conference, was recommended by the A d Hoc Committee on Institutional Affairs⁽¹⁾ and convened following agreement by the Heads of State and Government at the Milan European Council in June, 1985.

3.The SEA was signed in Luxembourg and the Hague on 17 February and 28 February, 1986 by all the Member States of the European Community. (Denmark, Italy and Greece initially abstained for various reasons). Article 33 of the SEA provides that the Act will be ratified by the Member States in accordance with their respective constitutional requirements. In order to meet the requirement of Article 29.6 of Bunreacht na hEireann (Constitution of Ireland), by which “no international agreement shall be part of the domestic law of the State save as may be determined by the Oireachtas” it is necessary to amend the European Communities Act, 1972. The European Communities (Amendment) Bill, 1986 was presented to the Dail on 23 September, 1986 in order to amend section 1(1) of the European Communities Act, 1972 [as amended by the European Communities (Amendment) Acts, 1973, 1977, 1979, 1985 and 1985(2)] so as to make appropriate provisions of the SEA part of the domestic law of the State and to provide for other connected matters. The Second Stage of the Bill has been ordered for Tuesday, 9 December, 1986.

4.In addition, to amending the three Community Treaties the SEA contains (in Title 111) provisions for a separate Treaty on European Co-operation in the sphere of Foreign Policy (EPC). These provisions do not amend the Community Treaties as EPC is not comprehended within the Treaties. However Title 111 may require to be ratified in accordance with Article 29.5 of the Constitution. This would entail approval by Resolution of the Dail of the whole of the SEA as it represents a potential charge upon public funds.

5.The Joint Committee thinks it appropriate to present this Report to the Houses of the Oireachtas to assist members in their consideration of the European Communities (Amendment) Bill, 1986.

Orders of Reference of the Joint Committee

6.When the question of discussing the SEA arose the Joint Committee considered whether the subject came within its Orders of Reference. A similar situation arose in relation to the Joint Committee’s consideration of the European Parliament draft Treaty establishing the European Union (Spinelli Treaty).⁽¹⁾ On that occasion the Joint Committee rested its case on the fact that the draft Treaty was the subject of a Resolution passed by the European Parliament and accordingly came within the ambit of paragraph (a) (ii) of the Joint Committee’s Orders of Reference which allow it to examine and report on “acts of the institutions of those [European] Communities”.

As the SEA was the subject of European Parliament Resolutions⁽¹⁾ the Joint Committee followed the same reasoning⁽²⁾ on this occasion to encompass consideration of the Act within paragraph (a) (ii) of its Terms of Reference. The decision was fortified by the fact that the SEA can be regarded as an act of a Community institution, having been adopted by the Council of Foreign Ministers.

Consideration of SEA

7.The Joint Committee established a Special Sub-Committee on the SEA under the Chairmanship of Deputy Maurice Manning. Deputy Joe Walsh acted as Vice-Chairman. The Special Sub-Committee heard oral submissions and received written submissions from the following:-

Department of Foreign Affairs

The Irish Council of the European Movement (ICEM)

The Irish Sovereignty Movement (ISM)

Mr. Dermot Scott, Deputy Head of Information in Ireland, European Parliament.

An Comhairle Oiliuna Talmhaiochta (ACOT)

An Foras Taluntais (AFT)

and considered written submissions from:-

Conradh na Gaeilge

Irish Campaign for Nuclear Disarmament (CND)

The Neutrality Study Group.

Pax Christi

The Joint Committee also availed of the opportunity of discussing the SEA with Commissioner Sutherland when he appeared before the Joint Committee in April, 1986. A Delegation of members of the Europa Kommission of the German Bundestag visited Dublin in April also and had an exchange of views with members of the Joint Committee on the implications of the SEA.

Acknowledgements

8.The Joint Committee expresses its gratitude to Deputy Manning and Deputy Walsh who compiled the Report and to the other members of the Special Sub-Committee who assisted them.

The Joint committee also wishes to thank the individuals and bodies who made submissions to it or who assisted it in any way in the course of its deliberations.

B. CONSIDERATION OF THE SINGLE EUROPEAN ACT

Legislative format of SEA

9.The SEA is an international treaty between the governments of the 12 Member States of the European Community. The Act is a hybrid document consisting of a Preamble, 34 Articles and 20 Declarations included in the Final Act. The choice of instrument chosen to amend the Community Treaties - an Act - is somewhat confusing in the Irish parliamentary context, having regard to its legislative connotations. The Joint Committee feels that the term “Treaty” might have been more appropriate. However, the Joint Committee understands that the genesis of the title stems from the fact that one instrument embodies all amendments to the three Community Treaties and has a separate treaty on EPC appended, together with a Final Act containing declarations.

10.Title 111 of the SEA contains the Treaty on European Co-operation in the sphere of Foreign Policy (EPC). As already stated EPC is outside the Community Treaties and the provisions of Title 111 (which deal with EPC) do not amend Community law. However, it is difficult to sever Title 111 of the SEA from the provisions which it is proposed to incorporate in Irish domestic law because Title 111 is referred to in other parts of the SEA, particularly in the Preamble and Title 1.

11.The SEA embodies all the amendments to the Community Treaties which were agreed by the Heads of State and Government at the European Council in Luxembourg on 2/3 December, 1985 and by Foreign Ministers at their meeting on 16 December, 1985. (The SEA itself was signed by the Foreign Ministers of the Member States, as already stated, in February, 1986 - See para 3) The most significant impact by far of the SEA is on the Treaty of Rome - the constitution of the Community - which it amends and extends in many important respects. Accordingly, the Joint Committee devotes its principal attention to this aspect of the Act.

Main features of the SEA

Improvements in the Council’s Decision-Making Procedures, notably to facilitate completion of the Internal Market

12.Certain improvements were agreed in the Council’s decision-making procedures under the EEC Treaty. Qualified majority voting in the Council will apply both in relation to some provisions of the Treaty of Rome where unanimity is provided for and in relation to some of the new areas which are to be brought within the Treaty. The main Chapters of the SEA in which provision is made for voting by qualified majority in certain cases are the Internal Market Chapter, the Economic and Social Cohesion Chapter (including implementing decisions relating to the Regional Fund), the Research and Technological Development Chapter and the Social Affairs (Working Environment) Chapter. Of particular importance are the new provisions for qualified majority voting in order to facilitate completion of the Internal Market by a target date of 31 December, 1992.

13.The Articles of the Treaty of Rome relating to the achievement of a single Internal Market that are to be subject to a move to qualified majority voting are:

14.The Internal Market and the Customs Union may be considered the “twin pillars” of the whole EEC structure. While the Customs Union was achieved ahead of schedule, parallel progress has not been made on completing the Internal Market. The recession, which gave rise to a proliferation of protectionist trade barriers, was probably the main reason for lack of progress in this area. Another important factor has certainly been the inadequacy of the decision-making procedures in the Council of Ministers operating on the basis of unanimity rather than majority. This meant, in practice, that a great number of decisions were simply not taken.

15.In order to complete the Internal Market a huge programme of legislative measures must be undertaken according to the Commission’s White Paper on Completing the Internal Market.⁽¹⁾

16.The “Luxembourg Compromise”, or the so-called ‘veto’ (which is a political arrangement and not one covered by treaty provisions) is unaffected by the SEA. According to the Department of Foreign Affairs the Government’s view that Member States should be free to invoke “vital national interests” in exceptional circumstances and with substantial justification is shared by the majority of our Community partners and is not under threat.

In Denmark the Folketing approved an amendment to the legislation permitting its accession to the Community to the effect that keeping the “right to veto” as laid out in the “Luxembourg Compromise” remains as in 1973 a sine qua non for its continued membership.

17.The area of fiscal harmonisation is entirely excluded from the move to majority voting. Therefore, unanimity is to be retained in respect of the harmonisation of legislation concerning turnover taxes, excise duties and other forms of indirect taxation (Article 99). Qualified majority voting will be applied in the adoption of measures for the approximation of regulations or administrative action in Member States which directly affect the establishment or functioning of the Common Market. At Ireland’s request, it was agreed that Member States would not be prevented from initiating national measures which they deemed necessary on grounds of “major need” such as health and environment issues, terrorism and drugs (Article 100A).

Nevertheless, the Act contains a commitment in principle to the harmonisation of indirect taxation, albeit by unanimous vote. This could have serious consequences for the budget and place in jeopardy the continuation of the 10% rate of corporation tax, on which our whole ability to attract industrial investment depends. Such a step could not even be contemplated, unless effective measures had been taken under the heading of cohesion.

18.An important provision from Ireland’s point of view is the inclusion of a new Article which allows the Commission to grant temporary derogations from the provisions establishing the Internal Market to certain of the weaker economies in the Community.

19.The ICEM is a leading protagonist for adoption of the SEA. In its written and oral submissions to the Joint Committee it has emphasised the central role of the Internal Market for Ireland as a country with a high dependancy on export markets. It sees non-tariff barriers to trade as a major obstacle to our economic development. Unhindered access to a market of 320m people, according to the ICEM, should bring about a significant increase in trade, with consequent important implications for investment, employment and market diversification. The prospect of stiffer competition and the possibility of a core/periphery dichotomy emerging in relation to trade development is acknowledged. However, the ICEM sees the new Chapter on Economic and Social Cohesion, with its stated purpose of reducing disparities between the various regions of the Community, as a necessary corollary to the completion of the Internal Market. It makes a strong case for explicit financial allocation to the structural funds to compensate for the negative effects of unrestricted free trade on smaller Member States such as Ireland.

The ICEM draws attention to the fact that majority voting already exists under the EEC Treaty and that the ‘veto’ is still in place.

20.The ISM in their submissions to the Joint Committee expresses its gravest reservations about ratification of the SEA. It sees the move to increased use of majority voting in the Council, particularly in relation to completing the Internal Market, as a “fundamental breach of the principles of representative government and democracy”.

The ISM offers a serious challenge to the contention that “free trade necessarily or logically requires the measures of further economic integration proposed by this new Treaty” and goes on to state that “political aims are being achieved under the pretence of free trade, and national legislatures, including our Irish Oireachtas, are being invited to divest themselves of significant competence and powers by means of verbal and political sleight of hand in this way”.

The Promotion of Economic and Social Cohesion in the Community

21.Effective provisions on the promotion of Economic and Social Cohesion in the Community are to be incorporated in the amended Treaty. The incorporation in the EEC Treaty of an Article on the Regional Fund gives a firm basis to regional policy. The task of reducing regional disparities is recognised in the Treaty as central to achieving harmonious economic and social development of the Community. It is furthermore provided that the cohesion objective is to be taken into account in the implementation of the Internal Market and in all common policies of the Community. The provisions envisage that the objective of cohesion is to be pursued (i) through the conduct and coordination of the national economic policies of the Member States, (ii) by being taken into account in the implementation of the Internal Market and of the common policies and (iii) by Community action through the Structural Funds, (the Regional Fund, the Social Fund and the Guidance Section of FEOGA), the European Investment Bank and the other Community financial instruments.

22.Article 23 of the SEA stipulates that the Community shall aim at reducing disparities between the various regions and the backwardness of the least-favoured regions. It introduces for the first time in the EEC Treaty special provision relating to regional policy which up to now had not been specifically provided for.

23.Following ratification of the SEA by all the parliaments of the Member States, the Commission has indicated its intention of bringing forward a comprehensive proposal concerning Economic and Social Cohesion in the Community. The Council will act unanimously on this proposal within a period of one year after consulting the European Parliament and the Economic and Social Committee.

24.According to the ICEM it is widely believed that one model which the Commission will choose for its new policy will be that of the so-called Integrated Mediterranean Programmes. These programmes were drawn up at the insistence of the Mediterranean countries, notably Greece, in advance of the accession of Spain and Portugal, and attempt to tackle regional problems in an integrated way. The ICEM states that, instead of funding isolated projects in disparate regions, the Commission proposes that in future specific regional areas should be tackled in a broad and comprehensive way, through the mobilisation of all available resources of cash - Community, national, regional and local.

25.The reduction of regional imbalances must be brought about by a reduction in the gap between the prosperous and less prosperous economies of the Community. In its Report on Completing the Internal Market⁽¹⁾ the Joint Committee stated:-

“This would imply a definitive commitment to the implementation of structural policies, especially regional policies, to accompany the realisation [ie the completion of the Internal Market], since otherwise Member States would not be in a position to accept and bear such a degree of liberalisation”.

Unfortunately, the SEA nowhere contains any explicit commitment to increase funding for regional and social policies. It is necessary to remind our partners of Protocol 30⁽¹⁾ on Ireland’s accession to the Community, which has rarely been invoked, which gives explicit recognition to Ireland’s industrial and economic development policies, and promises to assist them, so as to make it clear that the SEA can involve no weakening of safeguards of Ireland’s position as set out in Protocol 30.

26.In their submission to the Joint Committee ACOT states that the SEA provides for an increase in the co-ordination of the various structural funds in order to promote Economic and Social Cohesion in the Community. It is vital that this objective be taken seriously in an Irish context, given the scale of the problems of economic structure in many parts of the country. ACOT warns that Community seriousness of approach would be best demonstrated by providing increased resources to these structural funds. The case for such an increase in resources would be greatly strengthened if the high cost of the agricultural policy is reduced, through a cutback in surplus production and a reduction in existing levels of stocks.

The representatives of the Department of Foreign Affairs, when they appeared before the Joint Committee, informed members that a review is taking place on how best to adopt an integrated approach in relation to Community structural funds in line with the new provisions on Economic and Social Cohesion. This point was emphasised by Commissioner Sutherland when he appeared before the Joint Committee.

Role of the European Parliament

27.Under the SEA the European Assembly is officially renamed the European Parliament.

28.The SEA contains provisions concerning the role of the European Parliament which enables it to delay or propose amendments to certain categories of Community draft legislation. The new cooperation procedure amounts to a “second reading” for the Parliament of Community draft legislation covering freedom of movement, right of establishment, discrimination on grounds of nationality and recognition of qualifications, the harmonisation of health and safety conditions for workers, improvements to the Regional Fund, research and technological development and the internal market.

The procedure will operate as follows:

Once the Council has adopted by qualified majority the position on any of the above-mentioned policy areas, the Parliament will have the opportunity to debate the common position agreed by the Council and either adopt, amend or reject it by an absolute majority of its members. Where the Parliament chooses to amend the Council’s common position, the Commission is obliged to submit within one month a revised proposal to the Council taking into account the Parliament’s amendments. The Commission is also obliged to forward to the Council, at the same time as its re-examined proposal, the amendments by the European Parliament which it has not accepted and it shall express its opinion on them. This revised proposal can then be adopted by Council acting by a qualified majority, but unanimity is required if the Council wishes to depart from the text revised by the Commission. Where the Parliament chooses to reject the Council’s common position, that common position can only be adopted by the Council when all the Member States agree, ie by unanimous decision. If, however, the Council does not act on an amended proposal within the time period allowed (three months with the possibility of an extra month to allow for additional consultations), the proposal will lapse. This procedure falls far short of the power of co-decision which the Parliament was seeking. The Council will retain the final say and the institutional balance has been broadly maintained but that should not be allowed to overshadow the fact that the Council can no longer ignore the views of the Parliament if it wishes to make progress in any of the areas outlined above.

The agreement arrived at under the SEA has the potential to enhance the role and the stature of the Parliament because the Commission will now be required to take into account, in the proposal which it ultimately submits to Council, the views of the Parliament at its second reading and the Council will therefore, inevitably have to take greater account of Parliament’s views.

29.The SEA also provides, in relation to Article 237 (Accession Agreements) and Article 238 (Association Agreements) of the EEC Treaty that such agreements will henceforth require the assent of the European Parliament.

30.The European Parliament considers its Draft Treaty⁽¹⁾ to be at the origin of the SEA. It considers its Draft Treaty to be a more cohesive and logical framework for the realisation of the frequently-repeated calls for European Union (notably in the Treaties, at the 1972 Paris Summit and in the 1983 Solemn Declaration on European Union).

31.The European Parliament believes that the SEA is flawed by the omission of the Parliament from the Conference which drew it up, and, therefore, the exclusion of the democratically-elected representatives at Community level.

It has criticised the failure to extend Parliamentary control over areas of policy now decided by the Council of Ministers, and over which national parliaments no longer exercise control. It also criticises the failure to amend the internal rules of the Council so as to compel it to hold a vote when the Commission or three Member States so request, and thereby ensure effective decision making.⁽²⁾

Management and Implementing Powers of the Commission

32.Article 10 of the SEA proposes to give additional powers to the Commission for the implementation of rules laid down by the Council of Ministers. It represents an addition to Article 145 of the Treaty of Rome which deals with the role of the Council. [The powers already conferred on the Commission are provided for in Article 155 of the Treaty of Rome]. The amendment of Article 145 reverses the existing situation by making it the right of the Council to exercise directly certain powers of implementation of Council decisions the exception to the general rule. It should be noted that Article 10 of the SEA also stipulates that the Council may reserve the right in specific cases to exercise implementing powers itself. The procedures for conferring powers on the Commission must conform to certain principles and rules agreed unanimously in advance by the Council, following a proposal from the Commission, having obtained the opinion of the European Parliament. The aim of Article 10 of the SEA is to enhance the Commission’s management and implementing powers. This should contribute to a more efficient execution of Community business.

33.When agreeing the SEA the Inter-Governmental Conference requested that, before the SEA enters into force (following ratification by each Member State), the Community authorities should adopt “the principles and rules on the basis of which the Commission’s powers of implementation will be defined in each case”. The Commission submitted a proposal for a Council Regulation⁽¹⁾ to give effect to this undertaking in March 1986. The Explanatory Memorandum accompanying the draft Council Regulation states that:-

“The purpose of the present proposal is consequently to establish rules governing any requirements imposed in respect of the exercise of implementing powers conferred by the Council on the Commission. It takes over the three types of committee procedure discussed at the Conference (advisory committee, management committee and regulatory committee)”.

Agriculture and the Single European Act

34.The SEA does not give any major attention to agriculture or agricultural policy. But that is not to say that concern has not been expressed on the consequences for agricultural policy as a result of the ratification of the SEA.

This concern stems from the new management powers proposed to be conferred on the Commission in relation to the management of the Common Agricultural Policy.

At present Article 155 of the Treaty of Rome is the legal basis for action by the Commission across all its areas of activity. Article 43 of the Treaty of Rome deals specifically with agriculture. It provides for the organisation of the market for agricultural products. In adopting the set of basic regulations for the major products (carried out in the main between 1964 and 1968) the Council set down tasks and responsibilities which the Commission had to carry out in managing the market. These responsibilities are, in general, exercised in association with a Management Committee, which has representation from the Commission and the Member States. The Commission puts proposals to the Management Committee. Even if a qualified majority is against this proposal, the Commission may still take a decision in line with its original proposal. In that event, the Council has one month during which it may reverse the decision of the Commission. In practice, the Commission has very rarely proceeded with a decision which has not had the support of the Management Committee.

35.The separation of powers and responsibilities as between the Council and the Commission is quite clear. The Council fixes prices at the annual price fixing and determines major changes in the market organisation for the different products, eg whether intervention operates or not. It fixes the broad parameters of policy.

36.The Commission has responsibility to fix export refunds, aids to private storage, detailed rules for the operation of intervention arrangements (eg payment delays). The Commission does not have the power to suspend intervention for a product; that is the responsibility of the Council.

37.According to ACOT potential conflict has arisen in recent years where ‘management decisions’ by the Commission have led to price reductions. This would appear to cross into the prerogative of the Council to fix prices. However, ACOT feels that, while this may provide scope for legal and political debate, the reality is that the Commission has been forced to take such measures which have reduced prices in order that the budgetary allocations for agriculture were respected.

38.There are many proposals for changes to the Common Agricultural Policy in the pipeline. The ISM submission to the Joint Committee states “this is a period of fundamental reassessment of the EEC’s CAP”. The ISM feels that arising from this reassessment, fundamental restructuring of the CAP may be attempted. The EEC Commission has made no secret of its desire to greatly restrict the commitment to farmers to buy farm produce at agreed intervention prices. Quotas have already been placed on milk production. The ISM points out that the Commission has sought, and will continue to seek, to reduce those quotas and to enforce more rigorous regulations in relation to them so that, for example, one farmer’s deficit may not offset his neighbour’s surplus. The ISM points out that the Commission has proposed to end the intervention buying of beef - except in times of serious difficulty, to be determined by the Commission. The Commission has also proposed to end the intervention buying of butter during several months of each year.

39.The ISM agrees that the need to fundamentally restructure the CAP is widely recognised. It is of the greatest national importance for Ireland, that our special and wholly legitimate interests be defended in any such restructuring. The ISM states that the expected benefits for agriculture were a principal consideration inducing Ireland to join the EEC, membership of which posed well-recognised, and in the event partly justified, threats to Irish industry. The ISM now sees these benefits to agriculture under threat as a result of the proposed restructuring of the CAP. To the ISM it seems extremely imprudent to take any action at this critical juncture which might in any way endanger this country’s ability to secure a satisfactory outcome from any restructuring of the CAP. The ISM are of the opinion that endorsing the SEA may well lessen Ireland’s chances of having the CAP restructured in ways favourable to Ireland’s national interests.

40.The ISM feels that Ireland should insist on securing its agricultural interests in any restructuring of the CAP as a condition of endorsing the SEA. Ireland should insist that if the system of quotas is to be retained and expanded, that as a low-income country which is exceptionally dependent on agriculture, it should be awarded generous quotas. The ISM states that, realistically, this can only be done before ratifying the SEA rather than after ratification.

41.In their submission to the Joint Committee ACOT draws attention to the fact that there are forces outside any provisions of the SEA which may oblige a changed relationship as between the Council and the Commission in CAP decision-making. ACOT states that the financial guidelines for the CAP laid down at the Fontainebleau Summit in 1984 represent a major constraint on the Council and the Commission in managing the CAP. These guidelines provided a formula for fixing spending limits on the CAP, linking growth in CAP spending to growth in ‘own resources’. ACOT feels that in practice this means that the CAP budget in any future year will be linked to the level of spending in the three earlier years. ACOT states that from an Irish perspective, our primary ‘vital national interest’ is that the CAP be secured and that the drift towards its renationalisation be arrested. If that can be done with the current balance of decision-making powers as between the Council and the Commission, then the Council clearly has the option of maintaining the current balance. However, this would also require that the Council should arrive at decisions more quickly and decisively than has often been the case in the past.

42.ACOT warns, that whatever about granting the Commission further powers in market management, it is clear that restrictions on its existing powers should not be contemplated. It is vital that the Commission be free to react and make rapid decisions about a fast changing world market situation. An example of this is the need to respond rapidly on particular markets to extra competition from US agricultural exports, which are being offered at very competitive rates by virtue of the US Export Enhancement Programme (BICEPS).

43.ACOT also states that it is clear that there are difficult decisions ahead if the future of the CAP is to be safeguarded and that under existing law and practice it is the prerogative of the Council to take these decisions and nothing in the SEA changes this prerogative.

44.ACOT states that the SEA, in itself, does not provide for any additional Commission powers in the management of the CAP unless the Council unanimously decides to grant them. Neither does it in any way question the operation of the Management Committee system in the current CAP decision-making process. ACOT is of the opinion that, in strict legal terms, the Commission currently has more powers in market management terms than it has in practice chosen to exercise.

45.In its submission to the Joint Committee ACOT pointed out that the experience, as far as the Agricultural Council has been concerned, is that the Council has been very reluctant to hand over additional powers to the Commission. To support this point ACOT drew the attention of the Joint Committee to a recent example. In September last, the Commission sought powers to suspend intervention purchasing for butter and skimmed milk powder when it considered this necessary in order to tackle the surplus problem. The Council has refused - at least as yet - to give this additional power to the Commission.

46.The ISM would not agree with this assessment of the new powers to be conferred on the Commission and they have pointed out to the Joint Committee that the EEC Commission holds, and has expressed, views on the CAP which appear to conflict with the interests of Irish farmers. In their view the SEA confers greater real power and authority on the Commission. The Commission is the sole source of legislative proposals in the Community. The ISM feels that if the rate of adoption of EEC directives and laws is greatly speeded up and this is the intention behind, and the necessary consequences of, much greater resort to majority-voting on the EEC Council, the Commission’s real power must become greater. The ISM feels that is why the Commission is now putting pressure on Ireland to ratify the SEA. An increase in the Commission’s real power can only be at the expense of the powers of individual Member States, and especially weaker and less developed EEC States, such as Ireland. The ISM points out that the Commission’s White Paper on Completing the Internal Market⁽¹⁾ shows clearly how the Commission’s powers and competence will expand and that the Annex to the White-Paper lists nearly 100 draft EEC Directives, or proposals for Directives and Regulations, dealing with agricultural, veterinary and food matters, which the Commission intends to bring forward between now and 1992 if the SEA should come into force. The ISM states that, while most of these seem innocuous, some may not be because of their effect on the management of the CAP. The ISM further states that, for example, there are proposals for more extended use of EEC inspectors who might be given enforcement responsibilities for farm product quotas at individual farm level if the Commission gets its way in this area.

The Monetary Capacity of the Community

47.The monetary capacity of the Community is given EEC Treaty status by the insertion at Part Three, Title 11 of the EEC Treaty - Economic Policy of the EEC Treaty - of a new Chapter 1 entitled “co-operation in economic and monetary policy (Economic and Monetary Union)”. The new Chapter consists of one Article comprising two paragraphs. Firstly it is provided that Member States shall “take account of the experience acquired in cooperation within the framework of the European Monetary System” (EMS). Secondly, it is provided “that insofar as further development in the field of economic and monetary policy necessitates institutional changes” the provisions of Article 236, ie those concerning the amendment of the Treaty, shall be applicable.

48.Member States shall co-operate in accordance with the objectives defined in Article 104 of the EEC Treaty which lays down that

“Each Member State shall pursue the economic policy needed to ensure the equilibrium of its overall balance of payments and to maintain confidence in its currency, while taking care to ensure a high level of employment and a stable level of prices”.

This will be done with a view to ensuring the convergence of economic and monetary policy necessary for the future development of the Community. The Government’s Explanatory Guide to the SEA states that this Chapter “…. is modest in its implications. In effect it accords an enhanced profile to Community cooperation in the monetary field but it stops short of stipulating specific institutional arrangements for the development of the Community’s monetary capacity, in particular the European Monetary System within the Treaty”.⁽¹⁾ Judge Pescatore⁽²⁾ is of the opinion that this section will not encourage monetary cooperation.

Research and Technological Development

49.The SEA includes innovative provisions on research and technological development, the more important elements of which are the following:-

- A Community policy on research and technological development is brought firmly within the EEC Treaty.

- Provision is made for a multiannual framework programme in which the objectives, priorities and the amount of financial participation by the Community as well as other details would be laid down.

- Within this multiannual framework programme, specific programmes will be developed. The specific programmes may include supplementary programmes (involving the participation of certain Member States only).

- The provisions provide explicitly for a role for small and medium sized undertakings.

The provisions on research and technological development should provide a boost to Community activity in this area. To understand the importance of the new provisions relating to science and technology in the SEA it is necessary to be aware of the development of the Framework Programmes over the past 20 years.

First Framework Programme 1984-1987

50.In the 1960s and 1970s a number of specific Science and Technology (S & T) Programmes emerged from the Commission. These proposals evolved upwards on an ad hoc basis to the Council of Ministers. A changed procedure eventually proved necessary and there were demands for a greater commitment by Europe as a whole as distinct from individual commitments to S & T. This led to the First Framework Programme 1984-1987. The basic concept was that Europe would evolve an S & T strategy which would be planned from the top-down as distinct from the bottom-up approach as in previous years and rather than as extensions to existing programmes or ad hoc responses to current problems.

51.The First Framework Programme was much more structured than the previous S & T programmes. The new approach meant that individual sectoral programmes (eg the biotechnology action programme) derived from Community needs and S & T actions would be propounded to meet those needs. This Framework Programme was an instrument for medium term planning by the Community and for the implementation of a strategy. It served a twin purpose for the institutions. It was at once a programming guide for the Commission giving them leads on goals and priorities and it also served as a decision-making guide for the Council in adopting specific or individual programmes. It had seven major actions.⁽¹⁾

Under Action 1 of the First Programme it was proposed that agriculture have a provision of 115 million ECUs. As it turned out the total expenditure for that programme was only 30 million ECUs or 2% of the total provision.⁽¹⁾ This can be contrasted with the fact that agriculture consumes 70% of the Community budget at the present time. There were satisfactory and welcome initiatives in that programme, including the provision for biotechnology and for the programme known as the Stimulation Programme.

Subsequent Influences

52.In the 1970s and 1980s the rate of rise of unemployment in Europe was faster than in any other world bloc and the duration of period of unemployment was greater, showing that Europe had failed to respond to inflation and the oil crisis. The Community had become uncompetitive compared with the US and Japan. At the same time a yawning gap between S & T in those blocs emerged and coincidently it happened at a time when there was a unique wave of advances in the sciences including a whole new cluster of technologies.

53.The Joint Committee was informed that Europe has more than 1 million scientists and technicians which is twice the Japanese complement and approximates in quantity to the US. Nevertheless, the aforementioned yawning gap has been manifested economically, particularly in the extent to which even the domestic European market is being filled almost totally by new products from Japan and the United States.

54.A call, headed by European scientists, for an adequate and coherent European S & T policy led to proposals for a Second Framework Programme to include the following areas of specific Irish interest not included in the First Framework Programme:-

Nuclear - Non Nuclear Balance

Infrastructure

Small and Medium Enterprises (SMEs)

Food

Marine Resources

Alternative Land Use

Forestry

Stimulation Programme

Proposed Framework Programme 1987-1991

55.The latest proposals for a framework programme for 1987-1991 include a financial provision of 7,735 million ECU.⁽¹⁾ This amount is small but nevertheless significant in relation to its intention. It provides for eight major main activities. There are some major changes between it and the first programme. Biotechnology - “a new technological crossroads” is given prominence. This includes management of agricultural resources, forestry, agro-industrial technologies and the science of foodstuffs. Equally welcome, according to AFT, is the proposal to have a programme on marine science and technology. This includes the headings-coastal and marginal seas, marine technology, fishing resources, aquaculture and processing.

56.The provision entitled “A Europe for research workers” includes what is called the Stimulation Programme which provides for training, mobility and the introduction of career awards for scientists. This is important to Ireland because of the advance in science and the increasing dependence on multi-disciplinary work and multi-national work. Ireland cannot have the same opportunity for productivity in scientific input

unless it is in accordance and in collaboration with the centres of excellence abroad. The proposed Second Framework Programme is now before the Council of Ministers. The provision of career awards to keep eminent scientists in Europe is very apposite at the moment, according to AFT because the Irish universities are alarmed at the decline in their capacity to recruit the emerging new scientists.

The Relevance of the SEA to the Framework Programme

57.The Treaty of Rome provided specific powers for S & T investigation only in the cases of agriculture, fisheries and transport. Article 24 of the SEA incorporates all activities relating to science and technology into the Treaty of Rome. It is now an integral part of the Treaties. This enhances the role of S & T in Europe. The proposed Framework Programme forms the very core of the new Title VI proposed to be inserted in the EEC Treaty by Article 24 of the SEA.

Article 130I of the new Title VI states “The Community shall adopt a multiannual framework programme setting out all its activities”. Thus it will now be mandatory for the Community, in contrast to previous experience, to adopt a Framework Programme for all scientific and technological activities. The new Article VI further specifies that

“The framework programme shall lay down the scientific and technical objectives, define their respective priorities, set out the main lines of the activities envisaged and fix the amount deemed necessary, the detailed rules for financial participation by the Community in the programme as a whole and the breakdown of this amount between the various activities envisaged”.

58.Article 130K states that the framework programme shall be implemented through specific programmes. The duration of these programmes shall be fixed as well. It also provides in Article 130P that

“The estimated cost of the specific programmes must not in aggregate exceed the financial provision in the framework programme”.

59.AFT welcomes the inclusion of research and technological development in the Treaty. It is of extreme importance to Europe to have a common strategy and that it should be mandatory. Without a common strategy the decline in innovative capacity and in the productivity of the sciences will not be arrested. The same applies to Ireland, particularly because of our limited capacity.

60.The amendments in the SEA ensure that the frameworks will exist if adopted by the Council. AFT urges that the Government should ensure the early adoption of the Framework Programme and press for an adequate financial package so as to avoid the embarrassing and disappointing experience of the First Framework Programme. According to AFT any rigidity in the implementation of these provisions should be avoided. AFT recommended that Article 130I which states:

“The framework programme may be adopted or supplemented as the situation changes”.

should be relied upon in this respect.

The Environment

61.The SEA also provides that a Community policy on protection of the environment is to be brought expressly within the EEC Treaty. Until now, Community action in this area has been taken pursuant to the residual powers of the Community under Article 235 of the EEC Treaty

“If action by the Community should prove necessary to attain, in the course of the operation of the common market, one of the objectives of the Community and this Treaty has not provided the necessary powers, the Council shall, acting unanimously on a proposal from the Commission and after consulting the Assembly, take the appropriate measures”.

62.The Act lays down the specific objectives of the Community’s environment policy as well as certain factors to be taken into account in the formulation of this policy. These include available scientific and technical data, the environmental conditions in the various regions of the Community, the economic and social development of the Community as a whole and the balanced development of its regions and the potential benefits and costs of action or lack of action.

63.The Representatives of the Department of Foreign Affairs informed the Joint Committee that this latter consideration could be relied on to seek Community assistance in relation to protection of the environment.Judge Pescatore⁽¹⁾ has expressed the view that Community action in this area will essentially be subordinated to national action under these provisions. The “polluter pays” principle is included in Article130R.

Social Policy

64.The SEA provides for the adoption by the Council, by qualified majority, under the EEC Treaty of minimum standards in respect of the working environment, and for developing the dialogue between the social partners. Thus certain minimum standards may be set, especially in respect of the working environment, as regards the health and safety of workers. The relevant Articles provides that such minimum requirements are “for gradual implementation, having regard to the conditions and technical rules obtaining in each of the Member States”, and that they shall avoid imposing administrative financial and legal constraints in a way which would hold back the creation and development of small and medium sized undertakings.

Court of Justice of the European Communities

65.Two amendments relating to the European Court of Justice are to be incorporated, not only in the EEC Treaty but also in the Treaty establishing the European Coal and Steel Community and the Treaty establishing the European Atomic Energy Community. Hence, similar provisions appear three times in the SEA (in Articles 4 and 5, Articles 11 and 12 and Articles 26 and 27).

66.The first amendment provides that the Council may attach to the Court a court with jurisdiction to hear and determine at first instance certain classes of action or proceedings, subject to a right of appeal to the Court of Justice on points of law only. These classes of proceedings may not include proceedings brought either by a Community institution or by a Member State, or references by national courts for preliminary rulings. The second amendment reduces the length and complexity involved in any revision of the Statute on the Court of Justice. The detailed implementation of the Articles on the Court of Justice is subject to a uninimous decision by the Council.

These provisions are designed to ease the workload and improve the functioning of the Court of Justice.

European Cooperation in the Sphere of Foreign Policy

67.The principal effect of the Treaty provisions on foreign policy cooperation will be to formalise existing practices and procedures which govern European Political Cooperation (EPC) - the process which has been evolving gradually over the past sixteen years by which Member States agree to adopt, as far as possible, common stances on issues of foreign policy which are of general concern. EPC will continue to be governed by the consensus rule as it has operated hitherto. The SEA provides, among other things, that as regards security the scope of EPC will continue to be confined to the political and economic aspects of security.

68.At the practical level, the creation of an EEC Secretariat will entail that most EPC meetings will be held in Brussels. The Secretariat’s task will be to assist the Presidency in preparing and handling meetings and in administrative matters. The Secretariat will act under the authority of the Presidency.

69.According to the government’s Explanatory Guide the SEA poses not threat to Ireland’s neutrality.

Nevertheless, Article 30 6 (a) does state as a matter of general principle that the High Contracting Parties consider that “closer cooperation on questions of European security would contribute in an essential (Joint Committee’s italics) way to the development of a European identity in external policy matters”, and it clearly implies by the use of the word “ready”, that any limitation to the political and economic aspects of security is temporary in nature. At some subsequent date the first sentence could possibly be interpreted as agreement in principle to closer cooperation on all questions of security including defence. It is therefore essential to set out quite explicitly, so as to allow no room for ambiguity, Ireland’s position of military neutrality, and its right to conduct an independent foreign policy, particularly in so far as it relates to matters concerning security. Denmark in a declaration has safeguarded its position in respect of Nordic cooperation.

70.The ICEM firmly believes that for a small country, such as Ireland, with a limited influence on world affairs, our participation in the political cooperation procedure enables us to put forward our own concerns and views on a broad range of international issues from disarmament to human rights which, if shared by our partners in the Community, will carry greater weight and force than they would do were we to articulate them on our own.

71.CND regard Title 111 of the SEA as being entirely inconsistent with Irish neutrality and independence in foreign policy and in its submission states that Ireland should not ratify Title 111. Instead it is suggested that a unilateral declaration by Ireland should be appended in place of Title 111, expressing Ireland’s willingness to work towards disarmament and the reduction of international tension together with the other EEC states. This unilateral declaration would be an expression of good faith in Europe as a force for peace, but unlike Title 111, it would have no adverse legal effect on Irish freedom of action in foreign policy matters.

72.The Neutrality Study Group believes that Title 111 should be treated as a separate piece of legislation with a stay placed upon it to allow for full and prolonged public debate prior to holding a plebisite. The reservations of this group are based on the fact that eleven of the twelve EEC states are already members of NATO. They fear that as the bulk of the membership of the EPC structure is already aligned militarily in NATO, it is difficult, if not impossible, to see how the consensual view of such a grouping of Member States can do other than undermine any claim which the sovereign Irish people might have to neutrality.

73.Is e tuaraim Conradh na Gaeilge nach bhfuil polasai Eachtrach scartha o pholsai consanta agus go gcuirfidh an Ionstraim Eorpach Aonair an neodracht i mbaol.

73a.Pax Christi raises serious objections to the clauses in the SEA dealing with security. It is particularly critical of the determination of the High Contracting Parties to “maintain the technical and industrial conditions necessary for their security” [(Article 30 6 (b).] Any measures contributing to the arms industry or an escalation of the arms race would, according to the submission from Pax Christi, be immoral in Catholic thinking.

Pax Christi calls for the deletion of all references to “security” from the SEA on moral grounds.

74.The ISM are of the opinion that a common policy, with other States to which one is bound by treaty cannot be an independent foreign policy.

75.The attention of the Joint Committee was drawn to the views expressed on the SEA by Mr. Pierre Pescatore (a former Judge at the European Court of Justice) on 1 March, 1986 in Brussels. In relation to EPC he stated that “… the object in incorporating this system (EPC) in an international treaty is not to establish any commitments binding on the ‘High Contracting Parties”’.⁽¹⁾ In contrast to the views expressed by many opponents of Title 111 of the SEA in Ireland, Judge Pescatore contends that nowhere does the wording of Article 30 go beyond declarations of intent.

76.In all submissions received by the Joint Committee which referred to EPC two articles of Title 111 - articles 30.6(a) and 30.6(c) - were isolated for special comment.

The text of Article 30.6 (a) is as follows:-

“The High Contracting Parties consider that closer cooperation on questions of European security would contribute in an essential way to the development of a European identity in external policy matters. They are ready to co-ordinate their positions more closely on the political and economic aspects of security”.

According to the Department of Foreign Affairs this article explicitly states that only the political and economic aspects of security are legitimate subjects for co-ordination between the Member States. Military aspects of security are therefore excluded and discussion on them by Member States cannot take place within the EPC framework.

77.The ICEM in its oral submission reminded the Joint Committee that political and economic questions have featured regularly on EPC agendas and that Ireland has participated in this process.

78.CND claim that there is no definition of security in Title 111 and that by qualifying “security” with the adjectives “political and economic” in one sentence in the middle of the text, it does not mean that the general meaning of the word is similarly limited throughout the Title. CND maintains that it implies the opposite intention, ie that everywhere else “security” has its usual unqualified meaning.

The ISM claims that there is an implication that Ireland is not ready, or at least not yet, to coordinate positions on military aspects of security but may become so sometime in the future.

79.The Neutrality Study Group maintains that “it is disingenuous to suggest that co-ordination of security does not mean co-ordination in police and military matters. To pretend otherwise is to strain language beyond all permissible barriers and must in the end be judged deceptive”.

79a.Article 30 6 (b) which states that “the High Contracting Parties are determined to maintain the technological and industrial conditions necessary for their security” could be thought to represent a tentative effort to move towards a joint arms procurement policy, which would be incompatible with Ireland’s neutrality. It could also be interpreted as a legitimate defence of Sellafield, which is a part-military installation.

It should be made clear that Ireland could not subscribe to either such interpretation.

80.The text of Article 30.6 (c) is as follows:-

“Nothing in this Title shall impede closer co-operation in the field of security between certain of the High Contracting Parties within the framework of the Western European Union or the Atlantic Alliance”.

Article 6 (c) makes clear that the proper fora for discussion of military aspects of security remain NATO and the WEU. The Irish Council of the European Movement attaches importance to the clarification in Article 6(c) which it regards as providing a better safeguard of Ireland’s position than has been the practice up to now. Indeed, the ICEM have instanced the SEA as the first international agreement to recognise Irish neutrality and to provide appropriate safeguards for it. On the other hand CND regard the claim that Irish neutrality is protected by the text of Title 111 as erroneous. It argues that an implicit acknowledgement of our non-membership of NATO does not amount to a recognition of our neutrality, much less a guarantee that it will be taken into account in EPC discussions. Furthermore, this organisation questions why Irish neutrality cannot be afforded the same explicit protection as NATO and WEU are provided in this Article.

81.The Neutrality Study Group argue that nowhere is there the least suggestion that Ireland is in any way recognised as having a special position and that there is nothing whatsoever in Article 30.6 (c) to suggest that it was drafted to take account of the fact that Ireland is not a Member of a military alliance.

C. VIEWS OF THE JOINT COMMITTEE

Introduction

82.Debate on the SEA has been very sluggish despite the fact that the Act was signed in February last. The Joint Committee does not exonerate the Houses of the Oireachtas from this criticism. It feels, however, that a major cause for this deficiency has been a failure all round to comprehend the seriousness of the issues involved. The publication of the Explanatory Guide by the Government, albeit at a late stage, is a very welcome contribution to the debate on this important issue. The Joint Committee hopes that this Report will make a useful contribution to the debate and urges that it be debated in the Dail under the new procedure for debating Oireachtas Committee Reports, and in the Seanad. The Joint Committee’s Report could perhaps, in view of the urgency of the matter, be debated in conjunction with the Second Stage debate on the European Communities (Amendment) Bill, 1986.

83.The Joint Committee has already submitted to the Houses of the Oireachtas two major reports which are central to European Union - Report on the European Parliament draft Treaty establishing the European Union and Report on the Commission’s White Paper on Completing the Internal Market⁽¹⁾.

The former was debated in the Seanad, and in the Dail in conjunction with the Dooge Report. The latter was debated in the Seanad only.

Amendment of the Community Treaties

84.The Joint Committee regards the SEA as a most unorthodox amending instrument. It contrasts sharply with the positive and clear format of the Treaties establishing the Communities. The SEA is an amorphous document, styled a Single Act, containing four titles, two of which amend the Community Treaties and a third which contains a Treaty on European Co-Operation in the Sphere of Foreign Polciy (EPC) together with a Final Act (containing 20 declarations). EPC does not come within the framework of the Community Treaties and unlike other provisions of the SEA is not included in the Bill to amend the European Communities Act, 1972. The complexity of the SEA may well reflect the difficulties in reconciling the opposing viewpoints of Member States during negotiations. However, the Joint Committee, mindful of the difficulties that can be encountered in arriving at common positions at national level, has an understanding of the formidable task which confronted our negotiators at the Inter-Governmental Conference.

The Joint Committee would have preferred to see the EPC Treaty, as a stand-alone instrument, divorced from the provisions amending the Community Treaties.

The complexity of the SEA is compounded when the declarations (reservations) in the Final Act are taken into consideration.

85.The Joint Committee feels justified in expressing its apprehension about possible difficulties in interpretation when the Act is ratified. Member States have not been slow to exploit uncertainties in the existing Treaties which are lucidly drawn up, and accordingly the possibility of such exploitation must loom large for such a complex instrument as the SEA.

86.There is a political commitment to have ratification procedures, according to the constitutional requirement of each Member State, completed by the end of this year. There is no legal requirement in the SEA itself to ratify by a certain date. Article 33.2 of the General and Final Provision of Title IV merely states:-

“This Act will enter into force on the first day of the month following that in which the instrument of ratification is deposited of the last Signatory State to fulfill that formaltiy”.

87.The Department of Foreign Affairs’ representatives informed the Committee that failure to ratify by Ireland would result in a loss of Community goodwill built up since accession. The Department also ruled out the possibility of amendment or the anexation of reservations. However, this contention is challenged in many of the submissions received by the Joint Committee.

Completing the Internal Market

88.The fragmentation of the European market has been one of the main obstacles to economic growth in Europe. A Common Market has been created in name - but not in reality. According to the Albert and Ball Report⁽¹⁾, commissioned by the European Parliament, technical, fiscal and bureaucratic barriers to trade are estimated to cost European business £8 billion a year, or 2 per cent of Community GNP. For a country like Ireland that exports 66% of the products of its manufacturing industry - 80% of that to the European Community - the benefits of the freeing of trade are obvious.

89.From Ireland’s point of view the implications for industry, including the financial services sector, are clear. Access to a market of 320m people, without the present obstacles, should provide an opportunity to increase trade significantly. We have for so long talked about removing the existing non-tariff obstacles to genuine free trade within the Community that there is a tendency at present among industry and business to express scepticism at the prospects for any real change. There is every indication that business and industry in a majority of Member States now wish to proceed reasonably rapidly with the adoption of the necessary legislation and there is little doubt that they will have the support of the Commission which will be pursuing with zeal the implications of its detailed timetable.

90.The completion of the Internal Market could have important implications for three aspects of Irish economic development: investment, employment and market diversification.

According to the ICEM there are over 850 foreign-owned companies in Ireland employing 80,000 people directly, and giving employment to a further 80,000 in the services sector. Over 400 of these firms have parent companies located in other Community Member States. There is, therefore, considerable scope for attracting new investment in a more economically integrated Europe from within the Community as well as from third countries. In particular the advantages of establishing closer working relationships and joint ventures with other companies in production, research and marketing activities must be impressed upon Irish manufacturers.

91.In a recent speech, Jacques Delors, President of the European Commission,⁽¹⁾ called for a cooperative growth strategy which by adding one percentage point to the Community growth rate could reduce unemployment by 30% to 40% over the next five years. An integral part of that strategy must remain the increased economic activity which will result from the liberalisation of inter-Community trade.

92.In their submission to the Joint Committee the ICEM stated that the completion of the internal market will, of course, lead to much stiffer competition between the various Member States as the obstacles presently in place begin to fall. This could result in a scale of advantages in which Ireland, one of the weaker and less developed Member States on the periphery of the Community, could find itself at the lower end of the scale. For that reason, according to the ICEM, the inclusion of a new chapter in the Treaty dealing with economic and social cohesion of the Community, in other words the need to reduce disparities between the various regions, is a necessary corollary to the completion of the internal market. However, in view of uncertainties as to whether new resources will be made available for this purpose, the Joint Committee feels it necessary for the Government to again remind our partners of the terms of Protocol 30.

93.This welcome development is in line with the Joint Committee’s recommendations in its Report on the European Parliament draft Treaty establishing the European Union “that there should be a proper balance between moves to bring about the internal market and an effective redistribution policy”.⁽¹⁾

An important provision from Ireland’s point of view is the inclusion of an Artice (100A) in the SEA which allows the Commission to grant temporary derogations from the provisions establishing the Internal Market to certain of the weaker economies in the Community.

In its Report on the European Parliament’s draft Treaty establishing the European Union the Joint Committee voiced its opposition to a two-speed Europe. Unselective and indiscriminate requests for derogation could, in the Joint Committee’s view, lead to such stratification.

94.The time-scale for completing the internal market (six years) is ambitious and is unlikely to be achieved without sustained political priming at every stage as well as the active participation and co-operation of industry throughout the Community.

95.The Joint Committee must accept that the paralysis in the decision-making procedures in the Council cannot be allowed to continue, particularly in the face of such massive problems as unemployment and poor response to US and Japanese competition. However, the Joint Committee accepts many of the reservations expressed to it as well founded. The adoption of the SEA will result in a “qualitative leap”⁽¹⁾ forward and must bring major structural and economic changes in its wake. As a peripheral Member State, with a maturing industrial sector heavily dependent on exporting to Community markets, the cold wind of competition from the well established Member States at the centre of the Community will confront us with formidable problems. Accordingly the Joint Committee urges that the development and expansion of the structural funds be pursued with unrelenting vigour in order to restore the balance.

Economic and Social Cohesion in the Community

96.The proposal in the SEA to incorporate in the EEC Treaty for the first time special provision relating to regional policy is very welcome and echoes the sentiments of the Joint Committee expressed in its Report on the European Parliament draft Treaty establishing the European Union. The reduction of regional imbalances must be brought about by a reduction in the gap between the prosperous and less prosperous economies of the Community.

97.The Joint Committee would have liked to see an explicit provision of additional financial resources for the structural funds so that they could make a significant contribution to the objectives of economic and social cohesion. It maintains that, unless the question of increased funding is tackled as an immediate priority, there can be little prospect for a proper implementation of this section of the SEA.

98.The Joint Committee sees this chapter of the SEA as a major balancing factor to compensate for the negative aspects associated with completing the Internal Market, for example, the inevitable advantages that will be enjoyed by the core countries in a genuinely free market. The budgetary position of the Community is in a precarious position despite the decision to increase the VAT element of Own Resources to 1.4% following the Fontainebleau Summit. The Joint Committee must doubt the budgetary capacity of the Community to enhance the structural funds as it will be 1988 before an increase (to 1.6%) in the VAT component of Own Resources will be undertaken.

99.However, the Joint Committee urges that all necessary steps be taken to mobilise our national agencies so that they can put preparations in hand immediately to ensure that Ireland can respond quickly and effectively to any new opportunities that integrated regional programmes will present.

The Joint Committee was pleased to be assured by the representatives of the Department of Foreign Affairs that an integrated approach is already under active consideration in relation to Community structural funds.

European Parliament

100.The Joint Committee believes that the new cooperation procedure in relation to the European Parliament provides a basis for the development of better inter-institutional arrangements, particularly between the Council and Parliament. Both institutions have a responsibility to make this procedure work efficiently and thereby provide the Community with well-made, effective legislation. If this were not to happen, the new procedure could quickly lead to delays, slowing down an already cumbersome and lethargic decision-making process. Even worse, it could result in a blocking of the whole system. The Joint Committee reiterates the view of the Ad Hoc Committee on Institutional Affairs (Dooge Committee) that the principles of democracy are not served if the European Parliament’s role is restricted to a consultative one. The Joint Committee agrees with the general assessment of the European Parliament as having at present a role of mere influence as opposed to power.

Agriculture under the SEA

101.The Joint Committee has been very active in keeping the Common Agricultural Policy under review. A viable policy for agriculture is indispensable to the economic, social and political stability of Europe. The Joint Committee has expressed the view that it sees the CAP as the cornerstone of European integration⁽¹⁾. Therefore, the Joint Committee is disappointed to note that there is no specific reference to agriculture in the SEA. The only reference made is to the European Agricultural Guidance and Guarantee Fund (Guidance Section) in the Articles dealing with Economic and Social Cohesion. But concern has been expressed in many quarters about the consequences for agricultural policy and its management. These misgivings appear to be based on the new management powers⁽²⁾ proposed for the Commission. The Joint Committee wonders if these fears are unfounded in view of the fact that unanimity will be required in the Council to adopt the Regulation on which the proposed powers are based.

The Joint Committee draws attention to the fact that in 1984 and 1985, three quarters of the total flow of EEC funds (£645m and £837m, respectively) to Ireland came via the Guarantee Section of FEOGA. This is the area of Community spending where the Commission has the largest scope for decision making. The other area where the Commission has considerable scope is in the management of the Social Fund.

The percentage of the Social Fund resources (£141m in 1985) which Ireland has received has been high by comparison to our size. It compares very favourably with the percentage share of the Regional Fund resources received, which is based on shares negotiated in the Council.

The Joint Committee believes that the commitment in the Act to strengthen the structural policies of the Community must allow for appropriate compensatory measures for the farming community in the most disadvantaged areas where agriculture plays a major role in the local economy.

102.The Agricultural Council has been very reluctant to hand over additional powers to the Commission. In fact at present, according to ACOT, the Commission has more power in terms of market management, especially in relation to intervention, than it has chosen to exercise. The Joint Committee sees the maintenance of the CAP and, particularly its market support system, as a matter of vital national interest.

It must be secured and the trend towards renationalisation arrested. Several difficult decisions will have to be made in the future. Problems must be faced and a creative approach adopted towards solving them. Our credibility in negotiations concerning the CAP must be maintained.

103.The Joint Committee must caution that there are strong indications that the CAP is running out of political goodwill. An inflexible approach to other aspects of the SEA, such as the completion of the Internal Market, might not serve our best interests in negotiations relating to the CAP.

The Monetary Capacity of the Community

104.The Joint Committee welcomes any measures designed for the future development of the Community. However, it wishes to draw attention to reservations expressed in regard to economic and monetary policy as set out in its 14th Report.⁽¹⁾ The Joint Committee must again give expression to its desire that regional policy will not take a subordinate position to economic and monetary Union.

Science and Technology

105.There is nothing specifically enshrined in the Treaty of Rome which would have prevented adequate investment in Community science and technology and thus assist the Community to keep up with developments in other major economies. The difference between the original EEC Treaty and the amending provisions in the SEA is that there will now be a mandatory requirement on the Council to adopt a science and technology strategy for the Community. The Joint Committee was informed that the reason steps were not taken in the intervening years to bridge the apparent massive gap between the Community and its industrial competitors is because political will was lacking. The moral pressure inherent in the provisions of the SEA may compensate for past inadequacies.

106.All benefits which could accrue are dependent on political will to implement what is obviously envisaged in new measures. The Joint Committee was informed that universities in Ireland have benefited substantially from the programme known as the Stimulation Programme which is intended for the improvement of the scientific capacity of Europe. It provides for research exchange, training and collaborative projects.

107.The Joint Committee agrees with the ICEM and AFT that Ireland should welcome the inclusion of research and technological development in the Treaty since this marks an important step in the establishment of a European technological community aimed at matching the performance of its competitors, particularly the US and Japan.

108.In the Joint Committee’s view the provision on Research and Technological development are among the most innovative and welcome features from this country’s point of view.

Environment

109.The Joint Committee welcomes the formal legal status being accorded to the environment and the incorporation of the “polluter pays” principle.

In its Report on Acid Rain⁽¹⁾ the Joint Committee stated that:

“ . . . . the most effective way to conserve the environment is through co-ordination at European level where an overall view can be taken to ensure equitable and balanced development of Member States’ economies. The environment is a natural asset of the Community that cannot be delineated by national boundaries.

The Joint Committee also sees the co-ordinated approach to the environment as essential to defend the Community’s interests at international level”.

The Joint Committee see the role of the environment as crucial, not alone in terms of tourism potential, but as an outlet for Irish citizens who are experiencing a

significant switch in the balance between work and leisure brought about by technological development.

Social Policy

110.The Joint Committee feels that, in relation to the Social Policy, the working environment, particularly as regards the health and safety of workers, should gradually improve and the provision for dialogue between the social partners at European level is felt to be a step in the right direction. This development is broadly in line with the views expressed by the Joint Committee in its Report on the proposed Vredeling directive.⁽¹⁾

European Court of Justice

111.The SEA proposes to set up a new tribunal of first instance, attached to the existing Court with appeal to the latter. This will in effect provide for a two-tier Court. The Joint Committee does not see the new court, to which Irish citizens can have direct recourse, as having any jurisdiction wider than the existing Court. It will not deal with questions referred to it by national courts or Member States.

The establishment of the new Court and its incorporation in the three Community Treaties should improve the function of the existing Court.

European Political Co-operation

112.EPC has been the focus of much of the public concern expressed to the Joint Committee in relation to the SEA. The annexation of a separate Treaty on European Cooperation in the Sphere of Foreign Policy to the SEA has not done anything to allay this fear. The crossreferencing of EPC in the Preamble and in Title 1 compounds the issue. Accordingly, the Joint Committee feels that it is incumbent on the Government to convince Members of the Oireachtas that there is no actual or potential threat to our neutrality. The Joint Committee would have preferred to see Title 111 as a separate Treaty fully severable from Titles 1 and 11 of the SEA. This would allow for a separate debate on the whole issue of EPC.

For Ireland, the development of political cooperation must be firmly based on the growth and development of a community of interest between the Twelve in the economic and social areas. This fundamental principle has been articulated by successive Irish governments since we joined the Community, and has determined their attitude to the development of political cooperation. The incorporation of EPC within the Treaty framework is, therefore, an acknowledgement that progress towards greater economic union has been achieved and that the external identity of the Community is both political and economic.

113.On the positive side the Joint Committee takes some assurance from a statement by Lord Cockfield, Vice President of the European Commission, in the European Parliament:⁽¹⁾

“I must make the point very clearly that the Community does not have any powers in the area of defence policy”.

During the same debate, the President in Office of the Council of Ministers, Mrs. Lynda Chalker, said:

“European Political Cooperation covers the political and economic aspects of security, not the military aspects. Defence Ministers do not meet within the framework of EPC”.

114.In this connection the Joint Committee would also note that the principle of consensus which lies at the centre of EPC does not inhibit the right of any Member State to have an independent voice on any matter of foreign policy. The position of Greece may be noted in this regard where it refused to agree to a statement critical of Syria which had been accepted by the other eleven Member States.

115.The Joint Committee is satisfied that the Irish Government has never unwillingly been obliged to accept any EPC position with which it did not agree. Political aspects of security have featured regularly on EPC agendas. The ICEM pointed out to the Joint Committee that Ireland has participated fully in the discussion of disarmament questions at the United Nations, at the Conference on Security and Cooperation in Europe (CSCE) and the Stockholm Conference on Disarmament. In short, according to the ICEM, Ireland has always been prepared to take part in Conferences or actions which could contribute to a lessening of international tension. The Community’s active support for the Contadora Peace Initiative in Central America was given as an example of this.

Nevertheless, to avoid any possible ambiguity or misunderstanding of Ireland’s position and to prevent any possible erosion of it, the Joint Committee calls on the Government to append a formal reiteration of our position of military neutrality to the act of ratification.

The Joint Committee also notes that Senator James Dooge, who chaired and is eponymously associated with the Ad Hoc Committee for Institutional Affairs did not agree to the inclusion of the section on Security and Defence in the Committee’s Report to the European Council.⁽¹⁾

Public Morality

116.Fears have been expressed about a challenge to public morality from the SEA. Public morality in the EEC Treaty is covered by Article 36:

“The provisions of Articles 30 to 34 [dealing with the elimination of quantitative restrictions between Member States] shall not preclude prohibition or restrictions on imports, exports or goods in transit justified on the grounds of public morality, public policy or public security; the protection of health and life of humans, animals or plants; . . . . ”

This guarantee is reiterated in paragraph 5 of the new Article 100A of the EEC Treaty to be inserted by Article 18 of the SEA.⁽¹⁾

The Joint Committee trusts that this allays the fears of those who might feel the adoption of the SEA might compromise our moral standards. Additionally, the Joint Committee feels that it is worth quoting from the ICEM’s Paper on the SEA (November, 1986) in regard to this issue:

“The possible harmonisation of EEC Social legislation will not have any bearing whatsoever on Irish legislation in relation to abortion or divorce. EEC Social Policy as defined in Article 118 of the Treaty of Rome makes it quite clear that cooperation in the social field relates solely to: employment; labour law and working conditions; basic and advanced vocational training; social security; prevention of occupational accidents and diseases; occupational hygiene; the right of association, and collective bargaining between employers and workers; equal pay and migrant workers. A new Article in the Single European Act now adds health and safety of workers to this list.

Community legislation can only be introduced when it finds its legal basis in an article or articles of the Treaty. There is no legal basis for legislation relating to divorce, abortion or other matters concerning public morality and there is therefore no way in which the Community can affect legal provisions on these matters presently in force in Ireland”.

Orders of Reference of the Joint Committee

117.The present Orders of Reference of the Joint Committee allow it to examine all Community measures from their inception as proposals in the Commission through to their incorporation into the domestic law of the State.

The completion of the Internal Market will involve the adoption of a vast array of Community legislative measures. Accordingly, the Joint Committee will be turning its attention in the near future to considering the adequacy of its Orders of Reference to keep these measures under effective scrutiny. If necessary, the Joint Committee will seek additional power from the Oireachtas.

The Joint Committee, in this connection, must again voice its dismay at the fact that of its 33 Reports to date only one has been debated in the Dail. The Joint Committee commends the Seanad for its attention to its Reports. In the Joint Committee’s view there is not much encouragement for it to produce major reports if they are not debated in the House to which the Government is constitutionally responsible.

Conclusion

118.The Joint Committee acknowledges that the Community must be a dynamic institution in order to fulfil the vision of its founding fathers. It is widely acknowledged that the Community is tending to stagnate as manifested by its feeble response to the current economic crisis. Unless there is a unanimous desire for change and the Community accepts the challenge of a “qualitative leap” forward it will remain static and dissipate its huge potential for economic and political development.

119.The Irish electorate in the 1972 Referendum gave an overwhelming endorsement to Community membership and thereby demonstrated its commitment to Europe. The SEA represents the most significant development of the Community since our accession. Although the benefits of unrestricted free trade may tend to gravitate towards central Europe at the expense of the peripheral regions, the structural funds, particularly the Regional Fund, will have a major role to play towards halting and reversing this development and ensuring economic convergence.

120.The Joint Committee sets out in Appendix 1 the up-to-date position in relation to ratification procedures in other Member States, together with some reactions and reservations expressed.

121.The Joint Committee has raised many issues on which public apprehension has been expressed.

It looks forward to an informed and enlightened debate on the European Communities (Amendment) Bill, 1986 so these fears can be allayed, and hopes that this Report will make a useful contribution to the parliamentary process.

E. APPENDICES

LIST OF APPENDICES

1.Reaction of Member States to Single European Act.

2.European Parliament Resolutions Voting Pattern of Irish MEP’s.

3.Research and Technological Development First Framework Programme (1984-1987).

4.Research and Technological Development Proposals for Second Framework Programme (1987-1991).

5.Protocol No. 30 on Ireland annexed to the Act concerning the Conditions of Accession and the Adjustments to the Treaties of 22 January, 1972.

(1) Dooge Committee.

(1) Report No. 14 of the Joint Committee: PL 3063.

(1) OJ No. C36/144 (17.2.86) and OJ No. C120/96 (20.5.86). (See Appendix of Irish MEP’s for voting patterns)

(2) Report No. 14 of the Joint Committee (para 3): PL 3063

(1) See Declaration by the Government of Ireland in Final Act (Page 69 of Government Explanatory Guide).

(1) COM (85) 310 final.

See also Report No. 29 of the Joint Committee.

(1) Report No. 29 of Joint Committee.

(1) See Appendix 5.

(1) European Draft Treaty establishing the European Union (Spinelli Treaty).

(2)  

(2) Draft Regulation 5433/86 (COM (86) 35 final).

(1) COM (85) 310 final.

(1) Para 2.36 Page 21 Government Explanatory Guide to SEA.

(2)M. Pierre Pescatore was for some 18 years a judge of the European Court in Luxembourg, involved in the Legal application of the Treaties. He was formerly Secretary-General of the Luxembourg foreign ministry, and a Professor of Law. He retired from the Court last autumn. His comments of 1 March on the Single European Act are published in EP document PE 103.892/rev.2.

(1) See Appendix 3.

(1) See Appendix 3.

(1) See Appendix 5.

(1) See Footnote at Page 29.

(1) See Footnote at Page 29.

(1) Report No. 14 (Pl. 3063) and Report No. 29 of the Joint Committee.

(1) Albert M, Ball RJ: “Towards European Economic Recovery in the 1980’s European Parliament Working Document 31 August, 1983.

(1) European Parliament 15 January, 1986.

(1) Report No. 14 (P1. No. 3036 (para. 67)).

(1) See Interim Report of Ad Hoc Committee on Institutional Affairs (Dooge Interim Report).

(1) Report No. 26 of the Joint Committee - Perspectives for the CAP.

(2) 5433/86 (COM (86)35 final).

(1) Report on the European Parliament draft Treaty on the European Union (para 67).

(1) Report No. 25 of the Joint Committee (18 December,1985).

(1) Report No. 19 of the Joint Committee (Workers’ Consultation and Information Rights).

(1) European Parliament 21 October, 1986.

(1) SN/1187/85 (SPAAK 11).

(1) Page 51 of the Government’s Explanatory Guide.