Mr. Paul Cullen:

We submitted information to the joint committee in the form of the standard Oireachtas scrutiny note in April and when we learned that the committee was intending to proceed to further scrutiny, we sent it a more detailed written submission.

In that submission, we addressed five areas that we thought would be relevant to the subsidiarity check that the committee has embarked upon. First, we addressed the issue of the legal basis chosen by the Commission and the question as to whether the EU is competent to act on the basis of Article 153 of the Treaty on the Functioning of the European Union. We point out that the Government does not have any objection to the use of Article 153(2) as the legal basis for the establishment of this platform. This legal basis is also viewed by the Council legal service and by a large majority of the member states to be an appropriate legal basis for this proposal.

Second, we looked at whether the kind of action proposed is consistent with the principle of subsidiarity. We would point out that the objective of the proposed platform is to facilitate, promote, encourage and support co-operation among the member states rather than the introduction of any specific binding agreements or harmonisation of laws. We are satisfied that all operational aspects of the measures that might be taken to combat undeclared work would remain exclusively within the competence of the member states involved and we have noted that the committee's counterpart scrutiny committees within the legislatures of Sweden and Poland, which are not without their picky approach to these matters on occasions, have already concluded that the proposal does not infringe the principle of subsidiarity.

Third, we considered whether the action proposed is proportionate to the objectives the draft decision seeks to achieve. We are satisfied that the proposed platform does not go beyond the range of activities, all of which are undertaken by member states on a voluntary basis, set out in the instrument and that any measures adopted would exclude harmonisation of laws and regulations of member states. Fourth, we considered whether the action proposed could adversely affect national competence in the fields of social protection and taxation, and we have concluded that the proposed instrument would not impinge on national competence in the fields of social security, taxation policy or operational practice in that regard. Finally, we looked at the transnational dimension to tackling undeclared work. We note that the emphasis the European Parliament and the International Labour Organization have placed on promoting enhanced co-operation at EU level, especially through transnational exchanges of information and mutual learning between enforcement authorities in a bid to fight undeclared work.

The Irish experience of multi-agency co-operation and data sharing between different state authorities and the mechanisms established for them to work together with other labour market actors has already attracted a high level of interest especially among eastern European member states, as did the fact that the co-operation here extends across the Border through a cross-Border operational forum.

Counteracting undeclared work can create a better level playing field for businesses and improve the quality of employment. We consider that in the light of the complexity and the heterogeneity of informal or undeclared work and the diversity of circumstances within the member states that there can be simple solution to tackling this problem. The traditional mechanisms and resources employed by the enforcement authorities are best suited to tackling, mainly, domestic aspects of undeclared work. The international dimension of undeclared is, however, a reality. As a consequence of the free movement of services and workers, the effects of non-compliance with national legislation can influence businesses, societies and governments beyond a single country's borders.

We welcome the development of common concepts, measurement tools and the promotion of joint comparative analysis. We are concerned that the World Bank estimates used by the Commission, along with many other sources, in its impact assessment seriously overstates the problem in Ireland. The results for Ireland from the Eurobarometer direct survey undertaken last year of the general population's personal experiences of undeclared work are useful as a counterbalance to some of the problematic indirect methods used by the World Bank in this instance to estimate the size of the black economy. It is interesting to note from the survey last year that Irish respondents were half as likely as the EU average to say that they had undertaken undeclared paid work in the previous 12 months. Ireland had one of the highest proportion of respondents, 47%, who thought that people who worked without declaring their income ran a fairly high risk of tax or social security institutions finding them out and issuing supplementary tax bills or fines. In our view, action at EU level is justified in order to enhance co-operation between the responsible national authorities such as labour inspectorates, social security and tax authorities, in particular, enabling them to exchange information and best practices, analyse common problems and so on in the effort to deter undeclared work.

The Irish Government considers that a European platform on the lines proposed would be an appropriate vehicle for practical voluntarily agreed activities and shared studies undertaken on the basis of co-operation between the Commission and member states.