EU Competitiveness Council

Matt Hancock Excerpts

Wednesday 10th December 2014 Written Statements

[The Minister for Business and Enterprise (Matthew Hancock)]

My noble Friend the Parliamentary Under Secretary of State for Business, Innovation and Skills and Minister for Intellectual Property (Baroness Neville-Rolfe) has today made the following statement.

The Competitiveness Council took place in Brussels on 4-5 December. I represented the UK during the internal market and industry discussion on day one, with Shan Morgan the Deputy Permanent Representative to the EU representing the UK for the research discussion on day two.

The Council opened with a discussion on the single market. The Commission noted that the President’s investment plan was not just about the €300 billion investment proposed but also the wider investment environment which included the single market. The Commission then emphasised that the single market in services, including the ambitious implementation of the services directive was a key priority and there would be a renewed strategy in 2015 focusing on the business services, construction and retail sectors; this reflects UK key priorities. Joint letters on services and the digital single market prepared by like minded member states and signed by the UK were presented to the Council. I spoke to support the Commission’s view that the single market was important in the context of the investment package and to argue for a sectoral approach to services. Several other member states intervened in support. Others welcomed the Commission’s approach to services and thought that there were many regulatory and non- regulatory obstacles in place and that priority should be to ensure existing legislation was applied correctly.

On the digital single market, most member states supported the need for action, with different member states pressing different priorities such as ecommerce and copyright. A number of member states were keen to see more action on energy within the single market. The Commission noted member states support for a sectoral approach to services and potentially a need for a country specific approach. The presidency concluded the discussion by noting the need to remove barriers to a single market including through a sectoral approach on services and through improvements to the investment environment.

I was pleased that the draft conclusions on smart regulation were adopted without amendment, including important language calling on the Commission to develop and put in place “reduction targets in particularly burdensome areas.” Others said that these were the most ambitious conclusions on the subject to date and particularly welcomed the focus on targets. I believe these conclusions are a significant step forward and reflect a success for UK advocacy on better regulation.

The draft Council conclusions on industrial competitiveness were adopted, with the Commission noting that they were consistent with their priorities on smart, clean industry, digitalised manufacturing, the bio based economy and securing the energy supply through a single market for energy. I intervened to emphasise the importance of the single market to manufacturing, welcoming similar comments that the Commissioner has made in previous speeches. In response to the discussion paper most member states supported giving the Competitiveness Council a stronger role in commenting on dossiers in other policy areas. I intervened to propose inviting the relevant Commissioner to the Competitiveness Council. The Council also recognised the importance of the first SME Envoy report.

The presidency opened the debate on package travel by welcoming the progress on the questions of scope, insolvency protection and the level of harmonisation, which were identified by the Competitiveness Council in May 2014 as the outstanding issues. Although a general approach was agreed by a qualified majority, opposing voices came close to creating a blocking minority. Member states complained about a variety of more minor issues, including the speed of the negotiation and the new concept of “assisted travel arrangements”. I spoke in favour of the text with the caveat that the UK remained concerned about the potential implications for repatriation of holidaymakers in the case of airline insolvency within the context of the new directive.

A general approach to the revised cableways installation was adopted without comment. The revised text was acceptable to the UK as it includes an exemption for historic installations, which avoids costly burdens for those who operate vintage funicular railways at resorts in the UK on a not-for-profit basis.

A general approach was adopted on the revised personal protective equipment regulation. I intervened to oppose the expansion of scope to include domestic dishwashing and oven gloves, which had not been justified by the impact assessment and was an example of overzealous regulatory approach by the Commission that needs to change. The Commission defended the inclusion of these products on the grounds that EU manufacturers already produced gloves to the higher standard; their representative body, the European Safety Federation, had raised no objections to protection. However the Commission noted UK concerns and looked forward to discussions with the European Parliament.

Day one concluded with a presentation of their work programme from the incoming Latvian presidency. They highlighted their three main priorities: increasing competitiveness, seizing the digital agenda and strengthening the EU’s global reach.

I also attended an informal Council lunch at which Vice President Katainen presented the European investment plan for Europe and his plans for the €315 billion growth fund. I emphasised and welcomed the third pillar of the Commission plan which is to improve the investment environment through work on the single market and regulatory barriers and asked about the implications for Horizon 2020 expenditure.

On research, innovation and space, this was Commissioner Carlos Moedas’ first Council meeting in his new role as Commissioner for Research, Science and Innovation.

The Italian presidency opened the meeting with a discussion on science with and for society, linking the debate back to the recent Rome declaration on responsible research and innovation (which the UK supports). Common themes in discussion included the importance of open access to data and publications, education in science, technology, engineering and mathematics (STEM), initiatives to improve gender equality in the field of research, and the need to reform funding streams for research to ensure they are focused on excellence.

The UK highlighted the importance of a sound science evidence base in policy making (referring to Sir Mark Walport’s recent report on risk and regulation) and reminded the Commission of the need to indicate how this will be handled in future within the Commission’s processes. Commissioner Moedas acknowledged the UK’s points on the importance of scientific evidence in his concluding remarks on the item.

The Council agreed Council conclusions on the Partnership for Research and Innovation in the Mediterranean Area (PRIMA) initiative. Fourteen countries (not including the UK) have indicated their willingness to participate. The main subject of ongoing debate is the formal mechanism by which the initiative will be funded.

The Council also agreed without substantial debate a set of Council conclusions on the European research area (ERA), noting the positive findings in the Commission’s progress report published in September and looking forward to the finalisation by mid-2015 of the ERA roadmap (a plan to secure greater benefit from ERA between now and 2020). Council conclusions were also adopted without debate noting the contents of the Commission’s communication on research and innovation as sources of renewed growth.

The research session of the meeting concluded with two brief information items, one on the blue growth research initiative and another on the plans of the upcoming Latvian presidency in the area of research and innovation. The Latvian Minister indicated that their presidency will focus on the mid-term review of EU2020 (including Innovation Union), the enhancement of the European research area through the ERA roadmap process, better governance of ERA, and advancing the Science 2.0 debate.

There were interventions at several points during the morning on the recently announced investment plan of European Commission President Jean-Claude Juncker. Commissioner Moedas said that research and innovation would play a central role in the package and emphasised the intention to leverage additional resources for these purposes. Several member states, including the UK, asked for greater clarity on where the funding would come from and the impact this would have on basic and applied research.

The afternoon session was devoted to space matters, beginning with a debate on the future of European space policy. This was likewise the first meeting for Growth Commissioner Elzbieta Biehkowska (who is responsible for space). The Commissioner emphasised her intention to develop regular dialogue with the European space industry, to focus on delivery of the flagship Copernicus and Galileo programmes, and to stimulate research and innovation to ensure EU non-dependence in key technologies. A wide range of member state views was expressed in the ensuing debate. The UK stressed the need for an EU space policy developed in partnership with ESA and member states; the need to avoid legislation unless an internal market problem had been demonstrated; for future trade negotiations to consider the space sector; and for the EU and the European Space Agency (ESA) to consider themselves as equal partners.

The Council also adopted without debate Council conclusions on space renaissance. The meeting concluded with short information items on the Copernicus programme and the outcomes of the ESA ministerial meeting, followed by a presentation by the astronaut Luca Parmitano.