http://www.guardian.co.uk/analysis/story/0,3604,1394117,00.html

In the health trade

A controversial new European directive is in danger of
placing the
interests of business above the safety of workers and consumers

David Rowland
Thursday January 20, 2005
The Guardian

The government is backing a European commission initiative
aimed at
radically reducing the powers of national government over
multinationals. Although it has received scant media
attention in the
UK, the "Bolkestein directive" has provoked mass protests
and debate in
France, Belgium, Sweden and Denmark.
The directive, which Britain will seek to push through when
it takes up
the presidency of the European Union later this year, has
two main aims:
to erase any national laws and standards that make it
difficult for
European companies to enter the markets of other member
states, and to
allow European companies to run businesses anywhere in the
EU according
to the rules of their "country of origin".
The directive is controversial because it applies the same
rules to
healthcare and social services as it does to estate agents,
fairground
providers, advertising companies and private security firms. The
commission no longer sees the services provided by doctors
to patients
as a special public good to be enjoyed by all citizens, but
as an
"economic activity", a commodity to be traded across the EU
much like
any other.
Healthcare services are thought to amount to about 10% of
the EU's GDP,
so the potential for private companies to make profits from
healthcare
is vast. But publicly funded healthcare systems have until
now been
protected by national laws. Under "control of entry"
regulations in the
UK, pharmacies are granted licences to dispense NHS
prescriptions only
in areas accessible to those most in need. Supermarket
giants such as
Asda Walmart tried to persuade the government to get rid of
this rule
but, after a public outcry, the Department of Health
refused, knowing
that deregulation would destroy many community chemists.
The Bolkestein directive would require the UK to remove
these rules
because it regards them as an illegal barrier to market entry.
Under the proposed "country of origin principle", European
healthcare
companies providing services in the UK on a temporary basis
- such as
mobile treatment units, or providers of homecare workers -
would not be
required to meet the standards of the Healthcare Commission
or the
Commission for Social Care Inspection. They would be allowed
to operate
according to the different, and sometimes lower, standards
of the EU
country in which the company is registered.
The government has bowed to pressure from the British Medical
Association and others and promised to try to exclude
"publicly funded
healthcare" from the scope of the directive. But this does
not offer as
secure a protection as it appears. The Department of Trade
and Industry
has stated that it does not want to deny market
opportunities to private
healthcare providers and says there is no clear definition
of "publicly
funded healthcare" in EU law.
The fact that the DTI rather than the Department of Health is
negotiating the UK position in Brussels is a further cause
for concern.
The DTI is also on record as saying that concerns about
safety and
quality standards should not be allowed to outweigh the
potential
benefits the initiative might bring to British businesses.
Doubts have
also come from outside the healthcare sector. The Security
Industry
Authority, a government body that regulates nightclub
bouncers and
private security firms, has also voiced "grave concerns"
about the
directive. This industry is plagued by criminal infiltration
and poor
standards across Europe and the SIA fears that the
protection provided
to British citizens by the 2001 Private Security Industry
Act will be
undone, as people working for companies based outside the UK
fall
outside its control.
The trade union movement is worried that construction
companies will no
longer have to abide by UK health and safety laws on
building sites, and
environmental campaigners fear that local planning rules,
which govern
where supermarkets can open, will be judged to be an illegal
barrier to
market entry. Attempts to stem the growth in the number of
bars and
nightclubs in city centres will also be thwarted by a number
of clauses.
Clearly, the future of the EU and UK economies lies in the
development
of a thriving, service-based economy. But many would argue
that there is
something wrong with placing the interests of business above the
protection of workers and consumers.
Concerns about poorly regulated foreign companies being
given a free
rein in the UK should not be seen as nationalism in a
different guise.
As trade unions across Europe have pointed out, the
directive will mean
that those working for companies based in poorer countries
will find it
difficult to access the labour protection in the richer
countries to
which they are posted. Thus the much-feared "race to the
bottom" will
benefit least those communities in which people are most
exploited.
Yet if EU-wide standards can be introduced to govern the
quality of car
tyres, there is no reason why standards for high-quality
healthcare
cannot also be worked out. Providing European citizens with
a right to
high-quality public services and proper worker protection
may also help
to address much of the public's disenchantment with the
European Union.
As the debate over the EU constitution begins, there is a
clear need to
articulate a different vision of Europe to that contained in the
Bolkestein directive, one based firmly in the European
tradition of
social solidarity and responsible capitalism.

David Rowland is a research fellow at the School of Public
Policy,
University College London.