Michael Ahern (Cork East, Fianna Fail)

The vast array of interests that could be affected by the proposal, the plethora of regulation and controls that need to be removed or amended, combine to ensure that its passage through the EU institutions will be lengthy and complicated. That is why the Government's approach to the draft directive has been cautious and careful. We want to see the benefits of a real internal market in services but we must have in place the appropriate standards, particularly employment standards, to regulate it.

Since the draft directive was tabled by the European Commission in 2004, during the last Irish Presidency of the EU, detailed work has been undertaken in the Council, examining in precise detail every aspect of the proposal, article by article. The Council working group met on a regular basis, sometimes as frequently as every other week, to consider different aspects of the proposal. On a regular basis over this period, Ministers meeting in the Competitiveness Council reviewed the work and issued guidelines for the ongoing examination. While this work was going on in Brussels, officials of my Department were engaging in detailed and widespread consultation with all interested parties in Ireland to gather their reaction to the proposal. The widest possible consultation was carried out among professional, trade, employer, employee and consumer organisations, and views were invited from all sources. The views and information gathered in this way were used to inform our input into work at EU level. The result of that work, as we await the outcome of the deliberations of the European Parliament, is a revised draft proposal which runs to 123 pages and contains 338 footnotes, indicating serious concerns of, and amendments sought by, member states, a significant number from Ireland.

We have raised issues relating to the scope of the directive and have requested clarification of the wording of the exclusion of public services. We have raised issues relating to the country of origin principle, how it would work and how consumers would benefit from its provisions. We have raised concerns about the rules under which service companies would be able to establish in other member states. We want to ensure that the procedures are workable and established over a reasonable timeframe.

We have concerns about the introduction of mandatory insurance for service providers, mainly because further work needs to be done to assess the practicality of this proposal. We also have concerns about the mechanisms by which member states would co-operate with each other to ensure adequate supervision of service providers who are availing of the Single Market.

I have dwelled at some length on the process which has been and is under way, at national and European levels, to stress the care which is being taken by all member states, including Ireland, to get this project right and to ensure that the end result is the correct one from every point of view. As I mentioned, the next step is a vote in the matter by the European Parliament next month. Depending on the result of that vote, it will then be a matter for the Commission to consider tabling a new proposal. In that situation, the Government will re-engage with the interested parties in Ireland to get their views on any new proposal. That exercise will be no less comprehensive than the one carried out so far and I hope it will be accompanied by as extensive a public debate as possible on the issues involved and how they affect our future.

The recent debate in Ireland on the draft services directive has become mixed up, in a somewhat confused way, with the whole question of labour standards and migrant workers. In his contribution, the Minister for Enterprise, Trade and Employment, Deputy Martin, dealt extensively with these issues, but I would like to say a few words about employment standards, compliance with them and their enforcement.

The rights of workers from overseas are established by legislation as being equal to those of Irish workers. The vast majority of overseas workers have an entirely satisfactory interaction with the Irish labour market, one that is beneficial to all sides and the economy in general. However, there are instances in which overseas workers have not been getting their entitlements in certain sectors and particularly in cases where they may be relatively isolated. It was for this reason that the Government increased the number of labour inspectors last March to an all-time high of 31. These inspectors are in place, have completed their initial training and are now conducting inspections. More needs to be done with regard to the promotion of employment rights entitlements to employers, to employees and to migrant workers in particular. I have no doubt that these issues will continue to be discussed by the Government and the social partners in the context of partnership talks and indeed subsequently. It is important therefore to separate issues of enforcement of our employment law from the creation of a single market in services. which will not impact on that law.

In the ten years since the completion of the Single Market programme in 1993, more than 2.5 million jobs have been created in the EU as a result of the removal of barriers to trade. The European Commission has calculated that the increase in wealth attributable to the Internal Market in those ten years is nearly €900 billion. Competition has increased, prices have converged and the range and quality of products available to consumers has increased. However, despite some progress in specific sectors, the internal market for services is not yet working as well as it should or as well as it can. Most of the benefit seen so far from the Internal Market has occurred in the goods market. The need to make a serious effort on the services sector front has been evident for some time. The proposal for a directive on services is the opportunity to do something about it and it is an opportunity we should not miss.

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