COMPETITIVENESS: TARGETING THE LISBON STRATEGY - FIVE YEARS OF FUDGE.

The new Lisbon targets, reduced to their simplest form, appear in the box below. As is instantly apparent, there are plenty of them. And as is equally evident, their scope ranges widely, from measures or actions designed to boost Europes competitiveness, to broad statements of support for the social or environmental aspects of the oun-refocusedo Lisbon Strategy.

So alongside the jobs-and-growth-related injunctions to create sound macroeconomic conditions, to reform social protection systems, to develop research, to promote private investment with tax incentives, to cut red tape, to support innovative smaller firms and high-tech start-ups, and to complete the internal market and to cut state aid, the new targets also include repeated reaffirmations of the merits of social cohesion and sustainable development. Indeed they go further, imposing a series of obligations on business and on the member states that run clearly contrary to the supposed jobs-and-growth focus.

For instance, business must develop its sense of social responsibility, the internal market for services has to preserve the European social model, the final decision on the REACH discussions on chemicals must also take account of environmental and health protection concerns, and regional aid reform must ensure a reduction in disparities. The European Commission is required to provide a report in autumn 2005 on "how to ensure sustainable funding of our social model", and the European Council promises to adopt a new sustainable development strategy by the end of 2005 which will be more ambitious than the initial Lisbon text.

The Commission's planned re-launch.

The re-focused Lisbon Strategy thus bears an uncanny resemblance to the original Lisbon Strategy what the European Commission described in its February 2005 Communication on the re-launch of Lisbon (*) as "an ambitious programme of change" to make the European Union "the most dynamic and competitive knowledge-based economy in the world capable of sustainable economic growth with more and better jobs and greater social cohesion, and respect for the environment".

Yet the Commission's analysis in February was that the inadequate delivery on Lisbon at European and national level resulted in part from "a policy agenda which has become overloaded, failing co-ordination and sometimes conflicting priorities". In particular, the Commission planned to put at the top of its agenda to "shape the policies allowing our businesses to create more and better jobs". It insisted that "Europes actions need more focus" to "concentrate all our efforts on delivering on the ground policies that will have greatest impact" and "a rigorous prioritisation". The Commission was explicit about what it felt was needed more explicit than the Council conclusions a month later were ready to accept. The scope of the elements the Commission called for, but which the Council in most cases omitted or diluted, can be judged from a few quotations from the February Communication:

"Lisbons overburdened list of policy objectives has obscured the importance of these actions which can drive productivity growth. From now on, structural reforms, through such policies, should be pivotal in the renewed Lisbon strategy."

"We must extend and deepen the internal market. Member States must improve implementation of existing EU legislation if businesses and consumers are to feel the full benefits. In a number of Member States, key markets like telecoms, energy and transport are open only on paper long after the expiry of the deadlines to which those Member States have signed upa Member States are letting their businesses and citizens down by dragging their feet in implementation and enforcement."

"Key reforms are still needed to complete the single market and should be given specific attention: financial services markets, as well as services in general, the REACH proposal, a common consolidated corporate tax base as well as the Community Patent."

"Member States and the social partners must improve the adaptability of the workforce and of businesses as well as the flexibility of labour markets to help Europe adjust to restructuring and market changes."

The Kok report's recommendations.

The European Commission's inspiration for its February 2004 Communication was in part the November 2004 Kok report.(**) This was even more trenchant than the Commission about the failure to deliver on Lisbon: "The European Union and its member states have clearly themselves...