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The Current Issues on the EU Marketization Agenda

The pursuit of sectoral liberalization entrenched in the various sectoral directives first adopted in the 1990s has been dully carried on, with resistance waning as the logic as well as the consequences of liberalization have been increasingly accepted by users, workers and political representatives. This, however, did not prevent contentious debates from taking place in the European arenas as directives have been re-signed, with various groups of Member States looking for a compromise between a neoliberal approach and the defence of national providers’ interests or a more regulation-friendly philosophy in terms of quality, price and labour issues. Further steps towards liberalization have nevertheless been adopted with a third postal directive (adopted in 2008), a third energy package (adopted in 2009) and fourth railway package (still pending). These directives aim at increasing the level of competition by facilitating access for new, private as well as foreign operators to national markets. The example of the postal sector is interesting because full liberalization has now been in place (at least at the regulatory level) since 2011 and because it is often cited as an example for re-regulation at EU level with the obligation for Member States to define a universal service. While the impact of liberalization on funding, quality and price still remains uncertain, a recent study carried out for the European Commission suggests to engage with deregulation with regard to universal service designation, definition and price control.

Another interesting aspect of this broad agenda is the expansion of marketization to new policy territories. Healthcare offers a prominent example of how policy sectors which were so far believed to be at the core of national, socially rooted welfare states, are progressively being reframed and restructured in the framework of the EU single market. A directive from 2011 was adopted on the grounds that ‘patients’ rights’ to be reimbursed should be granted when they seek treatment abroad. This can be seen as a first step towards the opening of the national boundaries of healthcare systems. While operating through the frame of individual rights, this first incursion of the EU in the field of healthcare occurs against the background of increasing flows of medical tourism and emerging large multinationals in the hospital sector.

Finally, public procurement has been another area where the EU seems to push for liberalization. In 2011, the EU Commission proposed to update the existing legislation from 2004 in order to generalize competitive tendering and increase market shares of foreign providers in markets linked to public procurement. Under the auspices of French Commissioner Barnier and EP rapporteur Tarabella, the new provisions are protective of welfare services since they exempt contracts up to 750,000 (thus excluding a number of small-scale welfare services) and include qualitative, environmental and social considerations (including collective agreements) in the definition of the most ‘economically advantageous’ offer. It should be noted, however, that the EU Commission proves to be active on the issue of public procurement in a context where, similar to what happened with trade services in the 1980s, networks have been particularly active in promoting more competition in the realm of public procurement; for example, the revision of the Government Procurement Agreement of the WTO in 2014. This, again, points to the consistent strategy of the EU Commission (investigated in Chap. 5), which consists of pursuing marketization within the EU and globally in a parallel fashion.

While concluding to a quiet, but vigorous pursuit of the EU’s marketization agenda, it is interesting to note the ambivalent use of the diversity across national landscapes in Europe. On the one hand, diversity appears unproblematic when technological and societal change (e.g. the use of electronic instead of postal mail, mobility for seeking cheaper treatment abroad) is invoked to argue that marketization is bound to bring users more ‘choice’. On the other hand, though, diversity in terms of national traditions or implementation measures is invoked by policymakers to obscure the effects of said marketization on societies in terms of price, quality or unequal impact on various social groups. In contrast, several research projects carried out by independent academics (ironically funded by EU money) have shed light on important issues in the way welfare services are provided today. Their findings, nevertheless, seem to remain unheard and unable to trigger contentious debates between neoliberal- minded policymakers and their contenders, be they in the realm of institutional or contentious politics.

As far as protest and contentious politics in respect of welfare services are concerned, today’s climate is clearly characterized by the weakness of protest, and a disaggregation of the coalition which had been fighting liberalization from the mid-1990s to the mid-2000s. Interest groups active in the realm of welfare services clearly embraced both the sectoral fragmentation of SGI in EU policy making and the market frame as a means to achieve a better recognition of the specificities of social SGI (various services and assistance to people in need) vis-a-vis competition law. This strategy was not completely unsuccessful since the EU Commission revised the ‘Monti-Kroes package’ defining the legal framework for lawful state aid in 2011, and relaxed the conditions for small-scale social services to be funded by public money. Since the end of the decade of grand debates over SGI (1997-2007), remaining signs of activism on the topic from pro-regulation actors has taken two main forms. In the EP, where a group of Members of European Parliament (MEP) promotes an intergroup on ‘Collective goods and public services’ first created in 2009 and refounded after the 2014 election of the EP The intergroup functions as a forum and contributes to maintain a certain level of salience of the critical debate over SGI regulation in the EU. Second, following up on an ongoing UN campaign, the ETUC (and its member EPSU) have picked on the new European Citizen Initiative introduced in the Lisbon Treaty and launched a campaign for the recognition of water as a universal good (‘Water and sanitation are a human right! Water is a common good, not a commodity!’). The purpose was to lead the Commission to place water outside of the market realm and thus prevent any future liberalization directive (or EU commitment through international trade agreements). The million signatures collected in 2012 and 2013 were submitted to the Commission, which responded with a dull argument stressing the performance of the EU regulatory framework regarding water quality and the autonomy of the Member States to decide upon the conditions of distribution whether through public or private operators.

As mentioned above, the EU Commission, with clear backing of the Member States, has continued to catalyse liberalization through a twofold internal-external strategy which consists of encouraging the shaping of the EU single market for and through international trade. In the past few years, EU level and transnational contentious politics have crystallized on the latter. The failure of the WTO Doha round acted in 20082009 paved the way for a new generation of bilateral, multilateral or regional agreements between the EU and several countries or regions in the world. The activism of the EU Commission in this area has sparked protest from various transnational networks, as well as the unions, with the potential impact on welfare and public services being one of several bones of contention. Along with the agreement with Canada (CETA), the TTIP has become the main subject of contention in EU politics for the past three years and is being fought by a large international coalition of NGOs and citizens’ associations. With negotiations between the EU and USA being conducted in secrecy, while their content is partly revealed by Wikileaks, the acronym TTIP has become the symbol for a non-democratic neoliberal agenda. In spite of reassuring gestures made by the EU Commission—which for example issued a joint statement on public services with the US—the TTIP feeds diffused concerns over a general weakening of states’ capacity to regulate markets and control multinational corporations, notably in areas of public interest such as food and environmental regulation as well as all public services. Although the agreement and surrounding critique have both been much more reticent than for TTIP, another agreement, the TISA, was signed in 2012 and should relaunch services liberalization, with healthcare, education and culture being clearly involved as main areas where further liberalization and market expansion can be achieved.

Finally, a last aspect of the current marketization agenda in the EU is visible in a context where austerity and marketization are two sides of the same coin. In the aftermath of the financial crisis of 2008, many EU governments have been left with considerably reduced resources as a result of the salvage of their banking sector, or offensive attacks from the financial markets, or both. This has resulted in measures aimed at reducing public spending in various areas including welfare services. As a response to the destabilization of the Eurozone, the macro-economic governance of the EU has been restructured and forcefully redirected towards the enforcement of fiscal austerity. However, in the face of a rapid degradation of social cohesion in many parts of Europe, the EU institutions have not been entirely deaf. The result is a certain political schizophrenia of the Commission’s and Council’s so-called country-specific recommendations, whereby Member States’ governments are admonished to reduce their deficit but increase expenditure in areas such as childcare, employment service, education and research and so on. It is nevertheless clear that deficit reduction with more stringent EU rules is the overarching priority. A consequence for welfare services is that, given increasingly poor public funding capacities, the new European narrative frames the modernization of welfare states and services in terms of cost-effectiveness and increased involvement of private actors in the ‘for profit’ provision of said services. Where the ‘for profit’ logic should be inadequate, the Commission mentions the non-profit sector and the logic of volunteering and charity from ‘people and families’ as a last resort.

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