John Curran (Dublin Mid West, Fianna Fail)

I welcome the opportunity to make a brief contribution to this debate. The EU services directive is most important from an Irish perspective. I have listened to Opposition Members raise queries and fears, but we should view the directive positively as it will provide Ireland with increased opportunities to trade in services across the EU. I regret that much of the debate got side-tracked over Labour Party policy and the work permits issue. The debate on work permits is in many ways a red herring. Even if they were to be introduced, the time is limited. We had a work permit system a number of years ago but it did not address the issues about which people have genuine concerns in terms of labour welfare and so forth. The issue of work permits is irrelevant in this debate.

Ireland is the 14th largest per capita exporter of services in the world. Its share of services has increased significantly in the past decade, from under 0.4% in 1993-94 to 2.2% in 2004. That is a very significant figure for a small economy such as Ireland's. It is because of the export of services that this directive is of particular importance to this country. It is worth bearing in mind that at this stage the directive is only in draft form. It is not finalised and there is a substantial number of amendments to be made.

In most member states, services account for up to 70% of GNP and employment. They also account for the majority of new jobs created in Ireland in recent years and they are likely to account for the majority of new jobs created in the years to come. Studies have shown that the creation of a genuine single market for services would result in significant export opportunities for Irish service providers and would give Irish consumers access to a wider variety of services at more competitive prices. The overall effect would be to enhance Ireland's competitiveness and hence increase the potential market and employment levels of Irish service providers. It is worth noting that this is a two-way street. People are concerned about service providers coming to Ireland but this would also increase competition in the market here. The arrival of Bank of Scotland to the Irish market is a good example of this.

We should bear in mind that in 2004, the latest year for which figures are available, the level of Irish service exports was 2.2%. This is a significant figure for a small economy. Economic analysis undertaken by Forfás suggests that the implementation of this directive would result in potential gains to Ireland in the order of €450 million. The reason the directive is important is that many small and medium sized companies are burdened with red tape, bureaucracy and so forth, which makes it very difficult to trade abroad.

When debating the services directive, the issue that most frequently comes to light is the country of origin principle. With a number of Fianna Fáil colleagues I had detailed discussions on this issue before Christmas with the trade union leadership. It had genuine concerns on specific points, especially the country of origin principle, but was not opposed to the directive. It gave examples of countries such as Latvia and elsewhere that have considerably different wages and conditions and the negative impact this could have if that system were transferred to Ireland. We listened carefully to what was said and made these views known to our Members of the European Parliament.

We are concerned to ensure that employment conditions and standards in this country are maintained with the passing of the directive. That is absolutely crucial and we are committed to it. We want the directive to be implemented because it will enhance our export of services but we will maintain standards of employment and conditions in this country. We currently have a specific derogation from the country of origin principle in the posting of workers directive. I would like to see the draft directive changed so that instead of having a derogation, the country of origin principle would be changed in such a way as to ensure that our domestic arrangements would always have precedence.

I would like to see the amendment reflect this specifically, rather than having to rely on the derogation from the country of origin principle for the posting of workers directive. This derogation is currently in effect and any employee sent here to deliver a service would have to work under Irish labour conditions, including the minimum wage, annual leave, working time and any other agreement. It is important that our standards are maintained. Admittedly, at present this is by means of derogation. The amendments must reflect where we are coming from in regard to this point. We do not want to depend on derogation. We must maintain standards for workers but we must equally recognise that the passing of this directive offers significant opportunities for Irish workers and employers.

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