Common position of the national associations of French local and regional authorities on Services of general interest (SGI)

Context

Major developments have occurred during roughly the past year in relation to the environment for services of general interest:

-      entry into force of the Treaty of Lisbon;

-      the new EU 2020 strategy for the European Union;

-      the different consultations organised by the European Commission on evaluation of the Monti-Kroes package and on transposition of the Directive on Services in the Internal Market, known as the Services Directive, which pose considerable difficulties to local and regional authorities;

-      publication of the Monti report entitled "A new Strategy for the Single Market" and of the European Commission's Communication on the Single Market Act.

1.      Treaty of Lisbon

Article 14 of the Treaty on the Functioning of the EU and Protocol 26 on SSGI highlight the essential role of SGI in the framework of social and territorial cohesion by giving Member States and the EU the common duty of establishing the conditions that enable these services to fulfil their missions. These elements tie up, on the one hand, with Article 9 of the Treaty on the Functioning of the EU, which states that all EU policies should take into account the guarantee of adequate social protection and the fight against social exclusion, and on the other, with the Charter of Fundamental Rights of the European Union, which has the same legal value as the treaties, and in particular its Title IV on solidarity.

The European Commission's interpretation of Article 14, whereby this article is not binding in nature since it does not set out any specific type of initiative or time limits, is unacceptable.

The article admittedly does not impose a timeframe, but there can be no doubt that the Treaty signatories did not wish to see these provisions go unheeded. It is consequently for the Commission to take charge of the matter and to determine the means of achieving the objectives set by the Treaty, as it holds the monopoly on legislative initiative.

2.      The EU 2020 strategy

EU 2020 is the European Union's strategy for the coming decade. It will serve as a guide for the European budget and European policies.

However, the question of services of general interest, whether economic or social, is quite simply not addressed in the strategy.

While the Commission expresses ambitious targets – the Committee of the Regions has had the occasion to state that it shares them – it nonetheless fails from the beginning to give itself the means to achieve them.

How can the employment target (75% of the population aged 20 to 64 should be employed) be achieved without relying on effective public vocational training services, integration support services and so on?

How can the number of persons at risk of poverty be reduced by 20 million without relying on public  housing services, community-based social services, family support services, home help services and the like?

The European Commission's position, which consists in dissociating the key European strategies from the question of services of general interest, does not comply with the letter of the Treaty and deprives it of essential leverage for achieving the Union's objectives.

      The MEPLF's position on the EU 2020 strategy:
http://www.meplf.eu/documents/?doc_n_id=522&arb_n_id=71

3.      Services Directive and Monti-Kroes package

This section specifically concerns relations with the French authorities.

France has included certain social services of general interest (SSGI) in the scope of the Services Directive, in particular those related to childcare services and aid for the needy.

The recognised quality of its services could be jeopardized as a result of their inclusion in the Services Directive if, over the longer term, the existing authorisation schemes for these SSGI are forced to abide by less strict European regulations.

The national associations of French local and regional authorities have on numerous occasions expressed their willingness to participate in the process of transposition of this directive, in order to contribute their vision and experience of the distinctive nature of the governance of local and regional social services. They regret that such upstream participation did not take place, which had certainly contributed to the serious lack of legal certainty that exists today.

The national associations of French local and regional authorities have constantly sought a revision of the Services Directive with a view to taking into account the specific problem of SSGI.

On the matter of financial compensation for public service obligations, French local and regional elected officials consider that the European Union's competition rules are not always compatible with the organisation of public services, which guarantee the general interest and social cohesion.

In anticipation of revision of the Monti-Kroes package in 2011, the national associations of French local officials would like to draw the Commission's attention to the close involvement of French local authorities in managing and financing services of general interest (SGI) and their determination to ensure quality public services to all citizens. Accordingly, there is a need for flexible financing rules at EU level, adapted to needs on the ground and based on clear concepts. The French associations therefore call for a comprehensive revision of this package.

The national associations of French officials consider that these services make a vital contribution to achievement of the objectives of economic, social and territorial cohesion written into the Treaty of Lisbon and represent a valuable tool at the service of the EU 2020 strategy.

The reality principle must prevail. And the reality is as follows: SSGI rarely have an impact on the Internal Market and exist today within the general framework of rules that do not give adequate account to their specific characteristics and functioning or their special situation midway between the economic sphere and the prerogatives of the public authorities.

-      The joint contribution of the member associations of the MEPLF and the ARF to the consultation by the European Parliament's SGI-SSGI Intergroup – June 2010:
http://www.meplf.eu/documents/?doc_n_id=586&arb_n_id=71

-      The MEPLF's contribution in the framework of the European Commission's consultation on transposition of the Services Directive – September 2010:
http://www.meplf.eu/documents/?doc_n_id=579&arb_n_id=71)

4.      The Single Market Act

The future proposals on SGI announced in this document will have to be balanced and equally significant in the economic and social fields. Local and regional elected officials must be involved in reflection on the development and implementation of these new initiatives.

As such, the national associations of French local and regional authorities will continue to make the case for a more secure legal framework, more flexible financing of services of general interest and a variety of modes of organisation of public services: in-house (governmental corporation), concession, public procurement, PPPI (SEM-EPL, local public enterprises), public service delegation (DSP) or entrustment with grant of special rights.

In the light of the principles of subsidiarity and free administration of cities and regions, they also reiterate their opposition to any new initiative providing a framework for services concessions.

The expectations of the national associations of French local and regional authorities

In this respect, the national associations of French local and regional authorities consider that:

-      if the implementation of a legislative framework creates as many difficulties as the one regulating SGI, it is because the framework is inappropriate;

-      if the European Commission is obliged to put in place a legal assistance service for the implementation of legislation, it is because the legislation is not sufficiently accessible to the authorities to whom it is addressed;

-      if legislation leaves excessive interpretative jurisdiction to the courts, it is because it is not clear;

-      since the local and regional authorities are charged with implementing European law at a level as close as possible to citizens, their input must be given greater consideration to avoid inadequacy between rules and the mode of organisation on the ground;

-      since the European Commission sought the expertise of Mr Monti, who turned in a report in  May 2010 in which he recommends more flexible rules on services of general interest, it would be wise to take it into account.

The expectations of the European local and regional policymakers, first among which the French authorities, are simple and concur with those proposed by the SSGI forum:

-      The importance of public services in combating the crisis and pursuing the objectives of economic, social and territorial cohesion must be better recognised.

-      The Commission must help guarantee that where the Union's rules apply to such services, they are predictable and proportionate. This concerns in particular control of fair compensation, for which the burden of proof should be reversed.

-      A high level group made up of representatives of the European institutions, civil society and local and regional elected officials should be set up to bring about progress on this issue.

-      The Commission should seek more flexibility in the rules applying to financial compensation, in  particular by raising thresholds. The current de minimis threshold of 200 000 euro over three years should be raised to 200 000 euro per year.

-      The Altmark criteria should be clarified and compensation calculation parameters that are easy to implement should be proposed.

-   The public procurement procedure must remain one possibility among others for providing a public service. Local and regional authorities must be able to use all available tools as regards the  organisation and provision of public services.