Application of the principle of equal pay for men and women (debate)
President
The next item is the report by Mrs Bauer, on behalf of the Committee on Women's Rights and Gender Equality, with recommendations to the Commission on the application of the principle of equal pay for men and women.
Edit Bauer
rapporteur. - (SK) The gender pay gap is nothing new. For more than fifty years there has been an article in the Treaty of Rome forbidding gender discrimination in levels of pay and since 1975 Directive 117 has been in force, which requires Member States to enforce the principle of equal pay for equal work. It is of course true that not all differences in pay result from discrimination. According to the law of large numbers, however, the persistent differences in gross hourly rates of pay are not explainable.
Between 1995 and 2006, according to Eurostat, the differences based on hourly earnings fell from 17 to 15%, and this is at a time when the majority of university graduates are now women.
The trend may be declining, but not in a straight line. According to a study from the Dublin Foundation in 2007 covering four countries in the European Union, the gap was actually widening. If the pay gap narrowed at the current pace and did not increase again from time to time, pay would perhaps equalise after seventy years.
We can agree on the fact that the current legislation in this area is not very effective. The reasons for the pay gap are varied. They are of both a systemic and an individual nature. Sectoral, vertical and horizontal segregation, the classification of professions, the conditions for establishing a work-life balance and stereotypes all play a significant role in the persistence of the pay gap, which later carries over into a pensions gap and the final result is that poverty wears a female face, as we have been saying.
The pay gap also has individual dimensions. According to a study from the Commission, these increase with age, period of employment and education. Moreover, the statistics show that there are minimal differences in the case of young people. The gap appears after the birth of the first child and the return of the woman from maternity leave.
In relation to the demographic crisis now confronting us, this problem, besides being a major factor in economic competition, raises a profound moral problem which should also not be overlooked.
The question today concerns what the European Parliament can do to resolve the situation. On the one hand we have a persistent problem and on the other hand we have some rather ineffective laws. At the same time, of course, we must not lose sight of the fact that the reasons for the pay gap lie far beyond the bounds of legislation.
The European Parliament, however, has in its hands only one instrument - legislation. Everyone involved in this situation bears their own responsibility and ours is whether we can manage to send out a clear signal that we want better and more effective laws in the interests of establishing fairer conditions in the labour market.
Vladimír Špidla
Member of the Commission. - (CS) Mr President, ladies and gentlemen, the Commission welcomes this own-initiative report on the principle of equal pay for men and women and I congratulate the rapporteur on the quality of her work.
The Commission, like Parliament, considers the 15% pay gap between women and men in Europe today to be unacceptable. We must of course be careful and not lose sight of the fact that this indicator compares relative differences in the gross hourly earnings of women and men across the economy as a whole. It does not therefore measure just direct discrimination but is an indicator of all of the related factors and all of the disadvantages which women suffer from before they enter the labour market and over the entire course of their professional careers.
The Commission Communication of July 2007 stated that Community laws were effective in eliminating direct discrimination - in other words in cases where the remuneration for the same work is lower for women than for their male colleagues. They were, however, less effective in ensuring adherence to the principle of equal pay for work of equal value.
Based on a detailed analysis the Commission has concluded that it should be possible to consider amending Community law with the aim of ensuring above all that the systems for setting pay rates exclude both direct and indirect gender-based discrimination.
The Commission announced that in 2008 it would be evaluating Community laws from the standpoint of their implications in respect of the pay gap and that it would be proposing necessary amendments. The detailed analysis mentioned earlier is currently under way and I cannot predict what the results will be. In order to ensure quality, the Commission is making use of external specialist consultants as well as the extensive and detailed expertise and knowledge of intra-state bodies concerned with gender equality.
The preliminary results of this study will be discussed at a workshop in the first quarter of 2009, when all the interested parties should attend, including Member States, legal experts, intra-state bodies concerned with gender equality, social partners and civil society.
Parliament's attitude in this process will be decisive. It is significant that one of the participating law creating bodies has expressed a clear opinion that the laws in question must be amended quickly. It is also important that the practical recommendations of Parliament regarding the amendments relate to the areas which the main interested parties have identified as problematic, among them are transparency of remuneration and work assessments and sanctions.
In conclusion: we share Parliament's view that such a great difference in pay for women and men in Europe is unacceptable. The Commission considers that this is the right time to complete the analysis and the assessment and to plan the next steps, which will lead to more concrete results.
Donata Gottardi
draftsman of the opinion of the Committee on Employment and Social Affairs. - (IT) Mr President, Commissioner, ladies and gentlemen, I am truly proud of the work carried out in this Parliament and of its ability to make use of the already recognised powers to propose legislation.
The report that we are about to vote on concerns a key issue, a fundamental principle of European law: the principle of equal pay for men and women in the workplace. Not only is it a fundamental principle, it is also the first, at least in order of time, among the principles of equality. We know that it was already included in the Treaty of Rome, we know that it has been applied since the very first judgments of the European Court of Justice, that it was already regulated by a directive dating back to 1975, and re-regulated when this directive was recast in 2006, that it is the subject of continual studies and research, as the Commissioner himself said, and of continual claims for its application.
Why then do we return to look at it again in such breadth and depth today? There are many reasons: firstly because we refuse to accept its widespread non-application, to which all the statistics bear witness, and secondly because we believe that the extreme injustice suffered by women in all countries of the European Union and in all professions, at all levels and in all sectors absolutely must be tackled, and it is in fact obvious that the instruments we possess will not suffice for this, otherwise after all this time we would surely have succeeded in reversing this trend.
Finally, because we believe it is time to take the pay gap seriously and above all not to look on it as a mere accident in the working lives of women. What, then, are we asking for? We are asking the Commission for a specific, pertinent directive on pay gaps in general, but we are not stopping there; we are not merely asking for a directive, we are sending the Commission precise recommendations. We have built a bridge to cross over to genuine change and we believe that this bridge can be solid if it rests on eight pillars.
First and foremost, we want to lay down a definition of pay discrimination; it is not enough to look at gross hourly pay alone because that would indicate direct discrimination and such direct discrimination has in fact already been overcome. It is no accident then, if all the research looks at the whole picture, pointing towards part-time working, encouraging us to consider direct and indirect segregation, discrimination and horizontal and vertical segregation.
We are calling for comparable, effective, consistent and complete data. All too often we encounter manipulated or hidden data, facilitated by systems for classifying personnel, from backward-looking working structures marked by stereotypes. We believe that equality organisations can play a key dual role in combating discrimination, by raising awareness and by providing training for the judiciary and for social partners.
We aim to introduce specific penalties, bearing in mind, however, that preventive action and measures are also required; we need positive action and integration, therefore mainstreaming. I hope that this House will adopt the text in its entirety, because the more precise and detailed the work we submit to the Commission, the more we will gain in effective speed. That, in fact, is our hope: it is not enough to talk or write about equal pay, we want to make it a reality.
Anna Záborská
on behalf of the PPE-DE Group. - (SK) I would like to offer my frank congratulations to Mrs Bauer on the proposed text. As Mrs Bauer has said, the topic we are debating is as old as the Treaty of Rome. Little has changed in fifty years.
The question of equal pay for equal work performed by women and men rears its head with remarkable regularity especially during election periods. If the Committee on Women's Rights and Gender Equality proposes sanctions for companies which do not respect a basic principle of remuneration, objections are raised with reference to the principle of subsidiarity, as if this justified the inequality.
Last week I took part in the ministerial conference in Lille. I appreciated the attempt of the French Presidency to debate this topic but there were very few constructive responses aimed at solutions from the Member States. The statistics show that inequality in women's pay appears mainly after the birth of the first child.
The national and European policies aimed at achieving a balance between the responsibilities for the family and professional ambitions should not permit new differences to arise between employees who have family responsibilities and those who are unmarried or childless and who do not have such responsibilities. This is first and foremost a question of the social model we are aiming for.
I propose that we establish a coalition with industrial firms. If the managers of these firms are not prepared to work in close partnership with us to promote equality of pay, our report will simply gather dust.
Lissy Gröner
on behalf of the PSE Group. - (DE) Mr President, I am amazed that women are still so patient with us. We have been talking about pay inequality for 50 years, and nothing significant has changed. The numbers speak for themselves: 15% less for the same work. This deprives women of a fair wage, because, looked at the other way round, it means that women have to work one and a quarter times as long to earn the same money. Where do we stand in the European Union?
The Member States need to do more in this respect, and I am grateful to Mr Špidla for taking on board our proposals here in Parliament and for showing the will to take legislative action. Evidently there is no other option. In Germany, one of the largest Member States of the European Union, the pay differential in the private sector is 23%. That is unacceptable, and means that we are bringing up the rear of the EU.
We know full well that France and Scandinavia have taken positive measures. That is what it is about. We call on the social partners to take action, and the Socialist Group in the European Parliament calls for transparency in businesses, so that bonuses can be seen clearly and be included in the official assessment, so that we can get a grip on it. Regular wage audits may reveal successes or failures in combating wage discrimination.
In my view, a law for the private sector will be unavoidable in Germany. We must put more pressure on the Member States to introduce a statutory minimum wage, so that it can be taken for granted that women can earn a living wage, because that is the best safeguard against poverty in old age.
I would, in any case, call on the Group of the European People's Party (Christian Democrats) and European Democrats, in order to retain this clarity in Mrs Bauer's report, to withdraw its deleting amendments, which would further water down the report. Let us stick with the clear language it has at the moment.
Siiri Oviir
on behalf of ALDE Group. - (ET) Commissioner, President, colleagues. Rapporteur Mrs Bauer stated that poverty has a woman's face. I must also reiterate that even in 1957, Article 119 of the Treaty of Rome contained the principle that men and women should receive equal pay for equal work. Today however, in the year 2008, women in the European Union earn on average 15% less than men, and in my home country Estonia they earn as much as 25% less than men.
The wage disparity significantly influences women's position in economic and social life, both during and after their active working lives. It also intensifies women's risk of poverty, especially in families with single parents. The wage disparity between men and women often leads to differences in men's and women's pensions. Single female pensioners often live in risk of poverty.
As a result, I welcome the position proposed in the report, that is, that the European Commission should present a legislative proposal concerning the examination of current legislation concerning the principles of equal payment for men and women by 31 December 2009. We have passed too much legislation and waited too long, but the results are not very good.
As time has shown, this problem cannot be solved with European Union legislation alone. One significant outlet for the solution of the problem would be for the topic to be prioritised in political action plans. Only an effective combination of policies that includes better and more effective legislation and designates the responsible party will make it possible to find a positive solution to this problem.
I would like to thank the rapporteur for pointing out very important aspects in the report, and thank you for your attention.
Hiltrud Breyer
on behalf of the Verts/ALE Group. - (DE) Mr President, it is indeed true that, 50 years after the Treaties of Rome were concluded, we have made little progress regarding equality for women in the labour market. The figures are alarming: 80% of part-time workers are women, and only 57% of women are in employment, compared with 72% of men. Wage inequality has also remained stable since 2003, and has only changed by 1% since 2000. These are alarming figures, which all of us here lament. We have also referred to the fact that women are doubly disadvantaged, because this wage inequality is translated into differences in pension rights and social standards, and we also have a tax and social system that continues to penalise women, in that, for example, unmarried couples and double-income families are still disadvantaged in many tax systems, such as in Germany.
The Commission has stated that there will be legislative proposals, but why are they coming so late? Why have so many years gone by, in this parliamentary term, without any proposals in this field? We in Parliament have already called for proposals. With regard to quotas, we have said that there should be legal requirements. We also have Member States, such as Sweden, that have set objectives with a timeframe. Why do we not make use of the fact that we have these gender requirements to encourage the Member States to make efforts to resolve this shameful pay gap. In Germany, as has already been said, we are unfortunately third from bottom, with a shameful pay gap of 23%. We also need to make it clear that a statutory minimum wage will bring about changes particularly in sectors primarily employing women. However, we must also have the courage to make it clear ...
(The President cut off the speaker)
Ilda Figueiredo
on behalf of the GUE/NGL Group. - (PT) The devaluation of work by imposing low pay continues to be one of the ways most commonly used by capitalism to increase worker exploitation. This particularly affects female workers, which also implies a devaluation of motherhood.
It is unacceptable that, more than 30 years after a directive on equal pay for men and women, levels of discrimination remain high, particularly indirect discrimination resulting from a lack of job stability, which especially affects women and young people. In some countries, such as Portugal, where unemployment is very high, average pay differences between men and women have increased, exceeding 25% in the private sector and meaning that poverty still has a female face, including among the retired.
The European Commission and the Member States must adopt the measures needed to enhance the value of work, overcome pay differences and eliminate stereotypes linked to the jobs and sectors which always discriminate against women. Those professions and sectors in which women predominate, such as the retail and services sectors and some industries, need to be valued more highly.
Experience shows that worsening unemployment weakens women's rights, intensifies worker exploitation and increases discrimination.
We therefore insist on a new policy which gives priority to employment with rights, the fight against discrimination, and the protection of motherhood and fatherhood as fundamental social values.
We therefore support this report, to which we have suggested some amendments, pointing out that collective negotiation and bargaining have an important role to play in combating discrimination against women, not least as regards access to employment, pay, working conditions, career advancement and vocational training.
Urszula Krupa
on behalf of the IND/DEM Group. - (PL) Mr President, the draft report on equal pay for women and men contains some legitimate facts on equal pay for work of equal value. Equality in remuneration is necessary, as is proper payment in jobs that are dominated by women because of their psychological and physical predispositions.
The effect of regulations that have been written down in multiple pointlessly duplicated documents definitely depends on the effective implementation of the law in individual Member States. However, implementation may be quite difficult with regard to the predominant private sector, where the majority of managers look above all at the profits of their companies and have no respect for ethical and moral principles, at the same time preventing the action of trade unions which would protect workers and take part in pay negotiations. The problem of unequal remuneration is therefore an element of discrimination against the weak.
We do not need academics and experts to realise that discrimination is above all the result of left-wing materialist ideology, the lack of implementation of ethical principles, lack of personal development, selfishness, greed, taking advantage of the weak and poor, and not just in terms of salaries, but in terms of the growing practice in the European Union, which goes down even to the poorest and weakest states, of discrimination against Catholics and persons with views differing from those imposed by the political correctness which is required here.
Gabriele Stauner
(DE) Mr President, ladies and gentlemen, the fact that women are still paid less than men for the same work is a sad chapter in our European community.
Really, it is quite incomprehensible, because in law the situation is absolutely clear. Since the Community was established in 1957 - as has already been said several times - the principle has been enshrined in the Treaties of Rome as a directly applicable right. In other words, any woman could go directly to the European Court of Justice to enforce this right: the EU provides no stronger legal protection. Nevertheless, we have missed the target on this principle by an average of 20%. It is therefore absolutely vital - as the Commission is proposing here - to enforce this principle by means of secondary legislation.
That being said, this situation once again shows us that there is a difference between the law and real life. People who depend on their job and their salary - many of whom are women - often simply do not dare to demand their basic rights, for fear of being thrown out. We therefore cannot simply once again call for company responsibility, based on the fact that decency dictates that women should not be treated worse than men in terms of pay. However, he that will not hear must feel. I am therefore in favour of severe and consistent sanctions for those who break the law. It is up to the Member States, in particular, finally to take this seriously and to expose those companies that contravene this principle and to punish them, for example using procurement law.
I have one small criticism for the Commission: it is possible that the process has been rather too lax in this case, and that you paid too much attention to business. I congratulate Mrs Bauer on her report.
Teresa Riera Madurell
(ES) Mr President, Commissioner, I too should like to congratulate the rapporteur on her work. This is a highly relevant report given that the pay gap in the European Union is a reality that should be eliminated. It is unacceptable that women earn 15% less than men and that, in the private sector, this difference can be up to 25%.
This pay gap is difficult to fight as it stems from indirect discrimination: the most precarious work and the majority of part-time jobs are carried out by women.
What should we do? Basically, we must promote equal opportunity policies aimed at reconciling work and family life, and also policies aimed at cutting the number of and increasing the pay for the lowest-paid jobs, which are mainly held by women.
Therefore, among the report's recommendations - all of which are very important - I should like to highlight that of amending the Directive on the implementation of the principle of equal opportunities and equal treatment of men and women in matters of employment and occupation by including references to the pay gap, and also that of amending the framework agreement on part-time work, which is where the differences are greatest.
Marco Cappato
(IT) Mr President, ladies and gentlemen, I would like to say to Commissioner Špidla that, in addition to considering the excellent proposals in Mrs Bauer's report, if we can legislate at EU level against pay discrimination, I believe that would be right to include discrimination relating to pensions. Although this may be a more subtle, indirect form of discrimination, it is particularly heinous in a country such as Italy.
It also concerns discrimination in terms of retirement age, an issue that the European Commission has already looked at, and which I believe must be acknowledged. Back in 2004, the European Commission stressed to the Italian Government that it was unacceptable to have different retirement ages: 60 for women and 65 for men, which we can consider the more common legal age. As the radicals, we have, together with Emma Bonino, sought in every way possible to stress to public opinion, to the government, to the opposition and to the parties, that this structure must be removed. It has not been done.
Thanks to the European Commission, on 13 November the Court of Justice at last ruled that this discrimination is illegitimate and violates the Treaties and Community laws. The most serious thing is the line of reasoning taken by Italy in defence of this discrimination. Italy claimed that it was justified by its objective of eliminating the existing socio-cultural discrimination against women - in other words, discrimination on the labour market does exist. In order to remedy this form of discrimination, another is created, by forcing women to retire before men. In my view, this measure in particular also requires intervention, because it could be eliminated at European level.
Eva-Britt Svensson
(SV) Mr President, I wish firstly to thank Mrs Bauer for an important and constructive report, which I fully support. Secondly, a fellow Member recently referred to women as being weak. I would like to say that women are not weak. However, it is the patriarchal structures in society that make women weak.
The EU Equal Pay Directive has been in existence for 30 years. Despite this, women are still not worth as much as men - either when it comes to pay or influence - both in society and in the workplace. Despite the fact that women generally have a higher education, they earn on average 15% less than men for the same or similar work. It is thus clear that improving the existing legislation will not be sufficient to solve the pay discrimination. The differences in pay between women and men is ultimately yet another indication of the continued discrimination against women in all of the different areas. It is not enough that we have lower pay for equal work, we are also very often forced to take atypical work or part-time work etc. This pay discrimination haunts women right through their lives, as we also often get poorer pension terms and poorer conditions when we get older.
It is high time that we took action together to stop this discrimination against women.
Godfrey Bloom
Mr President, there is sadly a fundamental misunderstanding by most politicians as to the reasons why there are differentials between the genders in pay. The basic premise, erroneous though it is, perpetuates the myth that employment is a demand-led, employer-governed phenomenon. It is no such thing. Those who argue that all women should be paid the same as men for perceived similarities in the job description miss the point entirely that no individual is an economic unit.
In spite of already overburdening employment legislation, usually drafted by people with little or no business experience, pay differentials continue for one simple reason: employment is about demand and supply; it is about lifestyle choices; it is often based on priorities, early retirement goals, a desire to live in certain parts of a country or town, pressure of hobbies or sport, or one of those offspring. Employer and employee strike a mutual bargain in the same way as the buyer and seller of any commodity.
The UK Equality and Human Rights Commission employs substantially more women than men, and the average pay for their men is higher than for their women. I agree that past legislation has had a limited impact on these dynamics. Yes, you might as well legislate against a ...
(The President cut off the speaker.)
Zita Pleštinská
- (SK) Thank you Mr President, Commissioner. I am delighted that this 'women's' debate is under your chairmanship.
I appreciate the efforts of the rapporteur, Edit Bauer, to find a balanced approach towards formulating recommendations for the Commission and improving the framework of EU laws, particularly their effective enforcement.
As a result of varying transpositions, implementations and interpretations at an intra-state level, the directive setting out the principle of equal pay for men and women has failed to eliminate the gender pay gap, which is connected mainly with levels of professional segregation.
I appreciate the fact that the rapporteur has emphasised in her report that motherhood should not disadvantage women who have decided to interrupt professional careers to look after their children. In all Member States parents should, for a minimum period of one year after the birth of a child, receive support at the level of their net income prior to the start of maternity leave and at the same time these arrangements should be linked into a system of pay according to which the number of years worked are taken into account when setting pay rates. Motherhood should bring advantages to women, not disadvantages.
Education is equally important as it can contribute towards eliminating gender stereotypes and improving the remuneration of the few paid positions and posts which remain unoccupied by women.
The Member States must implement a consistent information campaign aimed at raising awareness among employers and employees of the existing or potential differences in pay on the labour market in the EU. At the same time, they must be informed about the essential measures that have been passed with the aim of ensuring that employers are penalised for breaching the principle of equal pay for equal work.
Thanks to the European Parliament's recommendation in this report, for which I congratulate the rapporteur Mrs Edit Bauer, I believe that the European Commission, in cooperation with the European Parliament and the Member States, will draw up laws that will indeed ensure equal pay for men and women.
Gabriela Creţu
(RO) Fellow Members, this report is perhaps the most serious document we have drafted concerning the pay gap. In particular, the recommendations accompanying it represent a step forward in terms of the principle of equal pay for work of equal value finally being applied. I must congratulate those who contributed to the report. Until now, work has been evaluated on the basis of tradition and the ability to negotiate. When I talk about negotiating, I am thinking of the involvement of powerful trade-unions capable of making governments and employers accept proper wages. Both these criteria have put women at a disadvantage.
We need a non-discriminatory system of evaluating work and a new way of classifying professions. We call on Member States and the Commission to finally embark on the path of adopting specific measures in favour of gender equality. We hope that they will make this public by supporting the clause which is the most favourable to women in Europe at the end of this month in Paris. Let us not have any illusions however. Even when the new system has been devised and implemented, it would only refer to paid work. Work carried out at home and in the black economy will continue to be performed, especially by women, without any pay gap as they do not even receive a salary for this work.
Věra Flasarová
- (CS) Commissioner, ladies and gentlemen, I consider the report of Edit Bauer to be a great success. Inequality in the pay of men and women is one of most stubborn forms of discrimination against women. As Mrs Bauer said, there is a lack of decent statistics on workplaces at both a national and an EU level. I have addressed this issue myself in a number of the books and articles I have published over recent years. Lower pay for women performing the same work and having the same qualifications and productivity is unfortunately caused by profound stereotypical perceptions on who should be the family breadwinner.
This duty is traditionally assigned to men and until now all employment structures, whether in the private or public sector, have more or less connived with it. There is a deeply-rooted view that a man supports from his wages not only himself but also his family, while a woman's pay is merely some sort of added extra for the family budget.
Incredible though it may seem, this illusion is so firmly entrenched that even with the fulfilment of equal rights in the workplace we cannot rely on cultural enlightenment, but instead we must unfortunately find ways to enforce equality through legislation. I am therefore very much in favour of the idea that Article 29 of Directive 2006/54 should be extended to include precise instructions on the application of principles of equality.
Marie Panayotopoulos-Cassiotou
(EL) Mr President, Commissioner, the report by Mrs Bauer does not need any additional comment on our part in order to show the path which needs to be followed to abolish a phenomenon of which society should be ashamed and which creates a reproduction cycle of injustice, with children in a family seeing their mother doing the same job as their father and being paid less and female colleagues seeing their male colleagues working like them and being paid less.
Thus society tolerates this phenomenon and reproduces it, because women should have the legislative means which will allow them to correct their circumstances as and when necessary, and the powers of state should introduce appropriate measures which take account of periods devoted to family life, periods of unemployment and periods of illness and which provide fair taxation in order to compensate for women's unequal pay for their work, which should be judged not only by the time spent working, but also by the quality and additional elements that a women brings to her work.
I repeat, Commissioner, the call made by Mr Cappato for you to review your stand as a Commission on the disputes which some Member States had on the retirement age for men and women and the country which had these disputes and was taken to the European Court of Justice. These disputes were corrective disputes for all women, regardless of whether or not they were mothers, and of course for mothers it is even more important to take account of the overall time, especially as you advocate an overall life cycle when calculating time at work.
(The President cut off the speaker)
Lidia Joanna Geringer de Oedenberg
(PL) Mr President, in the European Union, women earn an average of 15 to 25% less than men. In addition, the system of payment which takes into consideration years of service in determining pay levels is unfavourable for women, who often have to interrupt their careers for family reasons. Bringing up children, changes of job or less working time puts women in a situation of constant structural delay. The concept of equal payment for equal work cannot be distorted by a stereotypical approach to gender and social roles, which have previously significantly affected people's choices of profession and education, while maternity leave or family career breaks cannot be grounds for discriminating against women on the employment market.
The Directive on implementing equal opportunities and equal treatment of women and men in the area of employment and work is an irrevocable element of the acquis communautaire, and the Member States must implement it as soon as possible. The aim of reducing the pay gap must be fully implemented in employment regulations, and regular audits on equal pay and the threat of sanctions should put an end to all kinds of discrimination, particularly gender discrimination.
Ria Oomen-Ruijten
(NL) Mr President, I am grateful to Mrs Bauer for her excellent report. It beggars belief that today, we are discussing a topic that has been on the agenda since 1957, no less, when the equal treatment of men and women, equal pay for men and women were anchored in the Treaties. We have had European rules and laws for 30 years. We have a 2006-2010 road map from the European Commission, and one of the key objectives, which is also included in the Lisbon Strategy, is to narrow the wage gap between men and women.
Despite this, the wage gap is not getting smaller. In fact, last Saturday, I read in The Times that the difference in wages between men and women in the United Kingdom has increased to 21.7% in the private sector and to 13.8% in the public sector. There is no sign of improvement - take my own country, for example - in other Member States either. The gender report for the Netherlands from the World Economic Forum shows that the Netherlands is only ranked 88th on the list of equal pay for equal work.
Action is therefore called for. On Friday, the ministers from France, the Czech Republic and Sweden adopted a plan of action. How many more plans of action do we need though? Mrs Bauer makes a large number of recommendations in the resolution that she submitted, which is great, but there are two priorities in my view. First of all, we must ensure that equal treatment is applied, and much stricter controls should be put in place in this respect - equal pay for men and women on which all our social security systems are based. Secondly - and I really believe that this should be brought to your attention - there is the pension gap between men and women. We are faced with an ageing population, and if women do not have a pension, then we have a deeply sad situation on our hands. That is what we need to focus on in future.
Marusya Ivanova Lyubcheva
-(BG) I welcome the discussion on this report. That inequalities in pay between men and women persist is unacceptable. However, we should not limit our discussion to equal pay for equal work. We need to take a broader perspective. The individual nature of work lies at the basis of all activity, and it is important to find an objective way of assessing its value, with clear rules, criteria and indicators which will achieve greater objectivity, and eliminate discrimination through clear legislative measures. An important instrument is to evaluate occupations and jobs and to assess their price. The low financial status of some occupations makes them unattractive so that men generally avoid them and women take them. Improving this situation would have a positive impact on improving the economic independence of women. The low financial status of, for example, the services provided by nurses or teachers, is not acceptable, because it does not at all correspond to their importance in the development of society. This is an area where the Commission and the Member States also have their obligations.
Romana Jordan Cizelj
(SL) Ladies and gentlemen. I would like to begin by saying that I for one find it quite unacceptable that women earn on average 15% less than men and that in the private sector the differential is as great as 25%. Let me stress in this respect that in my own country, Slovenia, women do not lag behind men in terms of education, so action needs to be taken. Many people probably question why it is necessary to take action at a European level and why the solution to this problem cannot be left to the Member States. One of the reasons is that it is taking too long for these differences to reduce and another reason is that in the majority of Member States there are too few women involved in politics for proper attention to be given to gender-related problems.
A minority is only in a position to highlight its problems in a credible manner if, in a particular institution, such as a parliament or a government, it makes up at least 30% of the total numbers. And there are a large number of European countries which do not have a 30% representation of women in politics. The average proportion of women in the governments of the Member States and in their parliaments is less than 30%. Our representation in the European parliament is 31%, which is just a little higher than the critical mass we need to highlight gender-related problems effectively. This is why we have to do so from here.
Another question I have asked myself is whether the proposed measures are too revolutionary and whether they contravene the principle of subsidiarity. Here I agree with the rapporteur when she says that the legislation is not effective enough and that it could and should be strengthened. Our proposals must be bold and must represent a valid starting-point for the shaping of real policies. I support her proposal that the Commission should prepare a new legislative proposal regarding the existing laws on equal pay for men and women by no later than 31 December next year and I congratulate her on a well-prepared report.
Iratxe García Pérez
(ES) Mr President, two months ago, here in this House, we debated the annual report on equality between women and men. One of the most worrying aspects highlighted in that debate is now the subject of today's debate: the difference in pay between men and women.
It is worrying that, since 2003, we have not managed to reduce this 15% pay gap. This means that a woman has to work 52 days more in a year than a man to receive the same pay.
This is a wholly unacceptable situation in the European Union and we must therefore, without any shadow of a doubt, adopt both stronger legislation and stronger agreements with employers to try and eliminate this pay gap.
However, we will also shortly be looking at another questionable issue in this respect. Next month we will be discussing the Working Time Directive, which may also prove to be a worrying factor in terms of reconciling women's family and working lives. This is unquestionably a very sensitive issue in relation to work. We are therefore also expectant in this regard.
Rumiana Jeleva
(BG) My congratulations to Edit Bauer on the excellent work she has done on the recommendations on equal payment between men and women. I know that she has put a great deal of effort into drafting a document that takes as much account as possible of the real situation, and I hope that the recommendations contained in it will be put into practice.
In my country, Bulgaria, the pay gap between men and women is between 25% and 30%, and while the overall picture in the European Union shows a lower differential, the fact remains that women are paid less than men. Why is this? One of the factors is the pay structure of some occupations with a high proportion of female workers. Another cause is rooted in the fact that nobody feels responsible for the situation, and therefore nobody feels responsible for solving it. The current deeply ingrained stereotypes and prejudices on how labour is distributed between the genders not only hinder, but are often used as an excuse to ignore the problems.
What can we do in this situation? In the first place, as the report states, a mandatory condition is that the Member States must conform with current legislation. State policies must encourage the implementation of equal rights and equal pay. Secondly, transparency in evaluating work and setting pay rates must become an integral, rather than a formal, aspect of work in companies. And finally, encouraging in-house dialogue and good communications between management and the workforce, particularly in small and medium-sized enterprises, must become part of a truly new culture in individual European societies and Europe as a whole.
I would like to congratulate Mrs Bauer once again on her skilful presentation of the problems and the solutions she has outlined. Thank you for your attention.
Mairead McGuinness
Mr President, I would like to thank you for this debate. I would like to raise one issue, and perhaps the Commission could address this. We are speaking about equal pay for equal work, and we all want and desire that to happen. What is the Commission's view of the current job situation? I have a concern that, with so many jobs being lost in countries in the European Union, this issue could get worse rather than better because of people's desire to earn money, even if it is less than they are truly worth. I would like some comments from the Commission on that.
I would like to raise an issue of discrimination which certainly exists for men and women: public sector versus private sector workers where there are very different terms and conditions. They enjoy different pension rights and security issues and sometimes the inequalities are not just gender-based, although I appreciate that this report is about gender, and certainly my concern is that in the current situation this problem may get worse, rather than better.
Silvia-Adriana Ţicău
(RO) Mr President, Commissioner, there is a difference of 15% between salaries received by women and those received by men for carrying out the same work. In the case of women managers, this figure reaches 20% and even 30%, when it comes to managers of SMEs.
28% of female researchers in industry and only 34% of women in industry have more than one child.
Commissioner, while women are on maternity leave, the average annual percentage used to calculate the benefit relating to these periods produces a financial loss, in spite of the importance of this period in terms of social welfare. Mothers must not be penalised for giving birth and looking after their children during the first few months of their life.
I also believe that maternity benefit must be paid not only to mothers who have worked during the last 12 months prior to the birth. I do not think that it is a child's fault if their mother has worked or not during this period. Above all, I believe that there must be no discrimination among children right from birth.
DanutBudreikait
(LT) I can only repeat that as far back as 1974 documents were adopted obliging Member States to pay men and women equally for the same job. However, although more than 30 years have passed, the situation has not changed. Furthermore, in my country, Lithuania, reform of the pension system has begun. Part of the funds paid by workers into the state pension insurance fund is being transferred to private pension saving funds. In a few years it became clear that in order to receive an equal annuity from these funds women must pay 35% more contributions than men, as they live longer. Moreover, leaving these funds is like leaving slavery, it is impossible - this in itself is an infringement of human rights and freedom of choice. Apart from Lithuania only Bulgaria uses the same gender system.
Having investigated such cases, I invite the Commission to take the initiative and propose decisions.
Zuzana Roithová
- (CS) Commissioner, ladies and gentlemen, the fact that women in the European Union must work almost two months longer in order to earn as much as men is more than alarming. Even though Europe is dying, all we can do here is to state that wage discrimination against women and families with children persists up to the rate of 25%, although women have now surpassed men in educational attainment at a ratio of 60:40. Mrs Bauer has noted that in the so-called male professions the work of women is routinely undervalued for no objective reason. However, if the reason is the lack of working years that women devote instead to caring for their families, we must give the matter some serious thought. Families should not be a handicap.
Mrs Bauer is making waves and her arguments for starting on a review of anti-discrimination laws are convincing. I also support the proposal that access to public tenders and projects financed from EU funds should be made conditional upon a given company being able to demonstrate an anti-discriminatory pay policy. I believe this is the way to change the gender stereotypes of employers, especially in the private sector. I would like to thank the rapporteur for a highly professional report.
Bogusław Liberadzki
(PL) Mr President, in discussing this important issue, it is typical that there have been only two male interventions on this issue. In the case of Mr Bloom, his intervention was so male, that it was difficult to agree with.
However, we are considering a very important report. We are considering a report from which we know that work has great value, that it must be adequately paid, and this payment has to be differentiated on the basis of criteria such as the nature of the work, the efficiency with which it is done, ability to create added value, and not on gender criteria. But change is coming in the Member States as well. Allow me to mention my own country, where we have only very recently introduced gender equality which allows a father to take paternity leave, which shows that we are converging and we are on the right track.
Ewa Tomaszewska
(PL) Mr President, women do not get equal pay for equal work. However, their pay is also lower because they work in lower-paid sectors, and in temporary, lower-quality forms of work. A result of pay inequality is also inequality in social provision, particularly as regards pensions. On the one hand they get paid less for the same job, and on the other their shorter period of employment because of the responsibilities of motherhood are both reasons for the poverty of women when they reach retirement age. That is why unequal pay hits women twice as hard.
I would like to point out that the law usually forbids discrimination, while practice shows continued discrimination. The main question is therefore enforcing the law in practice.
Zbigniew Zaleski
(PL) There are no grounds for discriminating against women in this respect, and it is not a matter which is open to discussion. Three brief questions: on economic grounds, pay should correspond to the effects of work on the basis of the service provided, regardless of who does it. The second point: Europe is getting older, like it or not. Perhaps we should consider a bonus for women who are doing the same work as men, but at the same time decide to have children and bring them up, thereby keeping up the population. Point three: a good example in this area are academic institutions, or at least those which I know, where the opportunities given are equal, and payment is simply results-based. Perhaps this model could be extended to other sectors.
Andrzej Jan Szejna
(PL) Mr President, I would like to join those male voices, which unfortunately have been so few in the present debate, and which recognise that public debate and putting such an important matter as pay and equal pay for women and men on the political agenda is one of the most important matters guaranteed and rights guaranteed in national and European law.
I can say that like everyone else, I do not agree that payment rates should depend on gender. It may depend on education and experience, but under no circumstances on gender. It is my impression that national and EU law is quite well developed on this point, and in many cases it may be said to be very good, but what worries me is that it is not enforced, it is not put into practice because there is no tradition of doing so. The European Court of Justice has frequently reiterated that it is not being enforced. The question therefore is not to make more laws, but to ensure they are observed.
Astrid Lulling
- (FR) Mr President, the pay gaps denounced in this House are all the more difficult to understand given that the young women of today boast higher success rates at school than men in all the Member States and that they account for the highest proportion of graduates.
I should like all the same to emphasise that we have had a solid legislative base since 1975 and especially since 2006, and that the latter enabled me, in the years 1975 to 1980, to encourage women in my country who were being discriminated against to start legal proceedings against their employers, in particular from the public sector. Hundreds of millions of Luxembourg francs, the currency in use at that time, were paid out to them retrospectively.
First and foremost, then, we should make use of the sound legislation in force, even if it means improving it by endorsing our rapporteur's excellent recommendations.
Vladimír Špidla
Ladies and gentlemen, I would like to express my thanks for a debate which has tackled an issue that is simply unacceptable. There are no real or defensible reasons why a situation should persist under which women continue to receive less pay on average than men. You have mentioned in the debate a very wide range of approaches and a very wide range of issues that are linked to the pay gap and I think it was clear from the debate what a complex question this is.
I would like to state that this question is on the European political agenda because the Commission has just addressed the matter in a number of its documents and also in view of the fact that the Commission is drawing up a specific potential revision of current laws, and of course also because Parliament has taken up the topic thanks to the report of Mrs Bauer, for which I would once again like to express my appreciation. Also, however, thanks to the fact that in Lille the troika of the three succeeding presidencies did not just announce but actually adopted an action plan which establishes this issue on the agenda of three consecutive presidencies, in other words those of France, the Czech Republic and Sweden.
Ladies and gentlemen, I would also like to state that the debate in Lille, in addition to the action plan, presented the individual Member States with a set of concrete actions in this area, some of which, I must say, were very radical and in my view capable of producing results.
Ladies and gentlemen, I would like once again to thank you for allowing me to speak and for the debate and I would like to say that the Commission is fully prepared to cooperate with Parliament in this matter in order to bring about the gradual elimination of this unjust and untenable state of affairs.
Edit Bauer
Ladies and gentlemen, I would like to thank you for a very interesting debate. Allow me to make a few remarks. First, legislation alone will not solve this problem. As has already been said, there are many reasons for legislating but it is not possible, of course, to solve some economic problems through legislation.
I also agree that we should beyond any doubt make better use of the existing legislation. The long history of this legislation clearly suggests, however, that it is not very effective in its current form. We have no other instruments available to us apart from legislation. This means that our task is clearly to help in ensuring that the existing legislation contributes towards solving this long-standing problem in such a way that the labour market becomes a fairer place.
I would like to conclude with one final remark. Many fellow Members have emphasised that the continuation of such differences is unacceptable from the perspective of equal rights. I would like, however, to emphasise another angle, another aspect to this issue, and that is the requirements applying to economic competition, because equal pay for equal work is enshrined in the Treaty of Rome as a requirement of fair economic competition. I feel that this is the response to give to those colleagues who have been emphasising that the labour market operates under a different set of requirements.
President
The debate is closed.
The vote will take place on Tuesday 18 November 2008.
Written statements (Article 142)
John Attard-Montalto
in writing. - The legal framework within the EU relative to equal pay for men and women is widespread. The problem lies with enforcement.
It is agreed that discrimination in pay based on gender is diminished by existing legislation. Indirect discrimination is still an issue. Mostly, this results from economic segregation and in such cases existing legislation is limited in application. Evaluation of the legislative framework shows some differences in legislation concerning Gender Pay Gap (GPG).
Although operative legislation stricto senso has the same scope, existing directives show fundamental differences:
a) in 1975 the GPG was considered to be an economic competition issue, an ''integral part of the establishment and functioning of the common market', while
b) the 2006 Directive relies on the principle of 'equal treatment and equal opportunity'.
The data show a persistent gap between pay for men and women. The latest figures show a 15% difference between the gross hourly pay of men and women. In the private sector this is more prevalent and the rate rises to 25%.
The GPG used to be explained by differences on an individual basis, such as age, education and experience. Evidence suggests, however, that these differences play a relatively minor part in the persistence of GPG.
Petru Filip
The principle of equality of opportunities and equality of treatment between women and men is a topic with specific connotations in the Eastern Europe countries which have recently been integrated. The benchmarks used for professional performance essentially continue to be predominantly male-based. This outlook cannot be changed easily in the former Communist zone where, as a result of the propaganda efforts of the regime, the collective mentality has adopted a totally artificial model of equality. The lack of consistency with the primitive equality promoted by the propaganda of the Communist regimes has succeeded in undermining current efforts to promote equal treatment between women and men.
Based on these premises, I feel that every effort made nowadays to promote the principle of gender equality needs to focus on a broader educational aspect, offering the Community's citizens realistic system models for non-discriminatory treatment. In order to implement this principle throughout the Community, we need Europe's institutions to propose more than organising a European Equal Pay Day.
Zita Gurmai
It is no coincidence that one of the main elements of the 2006-2010 roadmap for equality between men and women is the effort to eliminate the pay gap between the sexes. The problem of the pay gap between men and women goes beyond the fundamental principle of equal pay for equal work. The difference in wages mirrors the serious inequalities that can be observed on the labour market and that affect women most of all. This indicates Europe's serious democratic deficit.
Solving the problem requires complex arrangements, which cannot be made without political determination. Existing legislation needs to be perfected, and its practical application promoted and monitored.
The true principle of equal opportunity can only be put into practice if each Member State shows decisive political will, and takes constructive steps to end the pay gap between the sexes. It is unacceptable that a good number of Member States should still fail to devote special attention to the pay gap between the sexes, be that in public debates or in political programmes.
Launching a social debate and organising educational campaigns are likewise indispensable. I urge that a package of political measures be prepared in order to remedy this problem, which in any case must take into account national differences and tried and true practices.
We need more precise and detailed statistical information in order to ascertain the true state of affairs and closely monitor developments. The reasons for wage differences need to be examined, and the information thus gained should be used to shed light on discrimination and to remedy and prevent it in the future.
Lívia Járóka
in writing. - I would like to congratulate Ms Bauer for her hard work in contributing vital recommendations to the European Commission on the application of the equal pay principle. The pay gap has a major impact on the status of women in economic and social life and constitutes an obstacle to equal economic independence.
There are several areas where women are affected by the gap in pay based solely on gender in Europe. Women encounter differences in their hourly pay in new and old Member States alike. Differences can be seen in the income distribution between men and women: 20 percent of women, compared to 40 percent of men in Europe, receive a similar income distribution in the top-range of salaries. Another glaring pay inequality lies in sectoral gender segregation, as half of jobs in three sectors are male dominated.
Finally, the over-representation of women - 30 percent - in part-time positions affects labour market contributions. These figures are even worse when it comes to women with certain ethnic origins, such as the Roma. While the EU's legal framework regarding equal pay is very extensive, in the European Union women are still paid less then men - even those with similar skills and education - which proves that improving legislation by strengthening its effectiveness is the main goal to achieve.
Anneli Jäätteenmäki
in writing. -The gender pay gap is alarmingly high in the EU. There have been some initiatives to decrease it, but the rate at which the gap is shrinking is much too slow. Parliament has repeatedly asked the Commission to take initiatives. The report on the gender pay gap outlines many specific ways the EU can tackle this problem.
It is important to define concepts like 'pension gap', 'direct pay discrimination', and 'indirect pay discrimination' more clearly and in more detail so that we have better tools for dealing with the gender pay gap.
We currently are lacking the accurate statistical data that we need to assess the situation. Member States and the Commission should improve their statistics, but so should private companies. Companies should be required to perform regular pay audits and make the results widely available.
Another way we can help to solve is problem is to add a specific reference to pay discrimination in Article 26 (Prevention of discrimination) of Directive 2006/54/EC.
It is simply unacceptable that women in the EU earn on average 15% less than men. As a governing body, we must do something to correct this injustice.


Combating tax evasion connected with intra-Community transactions (common system of VAT) - Combating tax evasion connected with intra-Community transactions - European Court of Auditors' Special Report No 8/2007 concerning administrative cooperation in the Field of VAT (debate)
President
The next item is the joint debate on
the report by José Manuel García-Margallo y Marfil on behalf of the Committee on Economic and Monetary Affairs on the Proposal for a Council Directive amending Directive 2006/112/EC on the common system of value added tax as regards tax evasion linked to import and other cross-border transactions - C6-0154/2008 -,
the report by José Manuel García-Margallo y Marfil on behalf of the Committee on Economic and Monetary Affairs on the Proposal for a Council Regulation on the amendment of Regulation (EC) No. 1798/2003 to combat tax evasion connected with intra-Community transactions
- C6-0155/2008 - and
the report by Bert Staes on behalf of the Committee on Budgetary Control on the European Court of Auditors' Special Report No 8/2007 concerning administrative cooperation in the field of value added tax
.
José Manuel García-Margallo y Marfil
Madam President, I must start by regretting that the Commissioner responsible is not here with us, although I am not really surprised, because there is plenty of noise and not much substance on this subject: great rhetorical statements about combating VAT fraud and very few measures with which to do so.
The communications that the Commissioner has presented to us, the last of which was on 1 December this year, make quite a fuss about the damage that tax evasion causes. It affects sufficiency, it affects equity and it causes market distortions with really major amounts of money. VAT fraud accounts for between EUR 60 billion and EUR 100 billion every year.
How can fraud be stopped? The diagnosis given in these communications is also generally correct, rhetorical and grandiloquent. They say that the national authorities have the responsibility to tackle fraud, but that operations where the supplier and the customer do not reside in the same country require cooperation between Member States. They also point out that the Court of Auditors, in its Special Report No 8, states that such cooperation has been clearly unsatisfactory and that action therefore needs to be taken. The problem comes when the Commissioner starts telling us what kinds of action need to be taken. He quite reasonably says that there are two strategies: one, which he calls ambitious, comprises a major reform of value-added tax, involving either a reverse-charge system or a tax withholding system with a clearing house, while the other is what the Commissioner calls 'conventional measures'.
We gathered from his appearance here on 24 June that he was not thinking of embarking on an ambitious reform under any circumstances and that he would confine himself to the 'conventional measures'. Subsequently, however, when he described the conventional measures, he put forward four that in principle are not bad. He talked about cutting compulsory declaration deadlines, enhancing cooperation among tax authorities, establishing shared liability when the purchaser of the goods does not declare who sold them, and improving the information on VAT taxpayers. He then concluded by saying that not even these four measures were among the concrete measures he was thinking of adopting. Today he comes up with two proposed amendments to the directive and regulation. He says that the aim of the first is to reduce the period for lodging the statements that VAT taxpayers have to submit from three months to one month, and the aim of the second is to reduce the period for transmitting the information to the Member State that has to charge the tax from three months to one month. Full stop. That is all the proposal lays down.
The Committee on Economic and Monetary Affairs has tried to spice up this really insipid story a little, and we have put forward the following amendments. We have approved an amendment favouring small and medium-sized enterprises, the purpose of which is to reconcile fighting tax evasion with simplification of the administrative burden on small enterprises, to which this Parliament and the EU as a whole have a commitment. We therefore say that the Commission must shortly, within two years, present us with a report describing how these measures have performed, how they have affected the administrative costs of businesses and to what extent they have been useful in combating tax evasion.
We also point out that the Commission should get rather more involved than it has been when making legislation. It should play a more leading role. We also call on it to centralise the data that the Member States involved transfer, to draw up a handbook of best practice so that the tax authorities can perform better, to develop indicators to show which areas are risky and which are not, and to tell us who is complying and who is not. Lastly, to make it easier to pursue fraudsters, we are setting up a register of individuals who cannot evade tax by setting up companies.
I regret the fact that the Commissioner cannot respond to the amendments that we have drawn up.
Bart Staes
rapporteur. - (NL) Madam President, Commissioner, ladies and gentlemen, tax fraud and VAT fraud are punishable offences. They may be white-collar crimes, but they are crimes nevertheless, and are sometimes related to organised crime.
What are the sums involved, because that always makes it interesting? In 2007, Commissioner Kovács estimated total fiscal fraud to be two to two and a half times the European budget, or a sum between EUR 200 and 250 billion. The share of VAT fraud in this is estimated at EUR 40 billion. All of this is probably a major underestimate, for the Court of Auditors estimated the loss of VAT income in 2005 to be EUR 17 billion in Germany and 18.2 billion in the United Kingdom, together responsible for just over EUR 35 billion of lost VAT revenue.
It is therefore to be welcomed that the Commission has funded a study, that this study is up and running, and that the results will be made public, so that we can see the true extent of the problem.
There are two basic problems where policy is concerned. First of all, cooperation between national tax authorities must improve and, secondly, we should really aim for shorter deadlines when the administrative bodies of the Member States gather and exchange information, so that things can be processed much more quickly.
My report mainly analyses the Court of Auditors' inquiry into VAT fraud. The Court of Auditors checked in seven Member States: in France, Italy, Luxembourg, the Netherlands, Poland, Slovenia and the United Kingdom. These countries cooperated well. Germany, though, refused all cooperation. In September, the Commission initiated infringement proceedings against Germany, something which, I have to say, Commissioner, I support.
The Court of Auditors has established that, in some Member States, the essential conditions for effective cooperation when it comes to controlling this form of fraud are completely lacking. My co-rapporteur pointed out that it takes longer than three months for requests for information to be dealt with. This is, in actual fact, inexcusable, because, in fact, these crimes should be combated in real time. The countries' internal organisation has also come under fire, though. The Netherlands and Germany, in particular, leave something to be desired. Moreover, there is a total lack of sufficiently strong control mechanisms.
It remains a mystery to me why Member States refuse to take a firm stand, even though they know they miss out on billions of revenue. This is really beyond me. The free movement of criminals is a fact of life. A united Europe in the fight against tax fraud remains a pipe dream to a large extent.
There is also good news, though. My own Member State, Belgium, has set up the European Carousel Network (Eurocanet network) that guarantees a spontaneous exchange of information. This, too, is flawed, though, since only 24 Member States have lent their cooperation, and three of the major Member States, to wit Germany, Italy and the United Kingdom, have refused to cooperate.
The Ecofin Council of 7 October has launched a new mechanism, namely the Eurofisc mechanism, to improve cooperation between the Member States in the control of VAT fraud. This is an initiative which, to my mind, is sound but will only add value if all Member States participate and if this is more than simply intergovernmental cooperation. I firmly believe that the Commission should be involved in this new initiative. It could in any event take part and even play a coordinating role.
Finally, I also think that we should work much more closely together in the judicial field too. All existing judicial obstacles in national law for cross-border, criminal prosecution should be removed without delay. In my report, I have included a list of measures to be taken. I should like to receive a response, or reaction, from the Commission, and I regret that the Council is not present because, at the end of the day, it is the Council that will have to take action in this area.
Louis Michel
Member of the Commission. - (FR) Madam President, ladies and gentlemen, I should like to thank the European Parliament and more especially the two rapporteurs, Mr García-Margallo y Marfil and Mr Staes, for the constructive reports they have presented on the delicate subject of the fight against VAT fraud within the European Union, in particular with regard to the Commission's first concrete proposal in this field.
We are today at a turning point in the implementation of our strategy to combat VAT fraud. The three reports that are to be adopted by Parliament tomorrow contain a number of recommendations on the way in which to improve the fight against fraud and reflect your opinion on the first of what will be a long series of measures.
On 1 December, the Commission adopted a communication specifying the measures that it will present in the coming months, as well as an initial directive containing some of these measures. The envisaged proposals also respond to the concerns and recommendations expressed in the report by Mr Staes.
The measures that the Commission intends to adopt can be subdivided into three categories:
The first brings together measures intended to prevent VAT fraud. One of these consists in establishing minimum standards for registration and de-registration in national databases in order to improve the reliability and comparability of information contained therein.
Improvements to the procedure used to obtain electronic confirmation of operators' VAT numbers and the corresponding names and addresses are also planned in order to guarantee greater legal certainty for suppliers.
Finally, the Commission is proposing to simplify the rules governing invoicing and to rationalise those concerning the chargeability of tax in order to guarantee its improved application, a move that will facilitate controls.
The second category relates to measures intended to improve the effectiveness of tax authorities with a view to detecting VAT fraud. The measure concerning the cutting of deadlines, which is dealt with in the two reports by Mr García-Margallo y Marfil, falls into this category. To improve the detection of fraud, it is also necessary to ensure that exemptions from VAT on imports are better monitored, as the Commission proposed last Monday, and to extend the scope of the information that Member States will have to make available to the tax authorities of the other Member States via automated access to their databases.
Finally, as you indicated, this category also includes the creation of a European network, known as Eurofisc. The latter is intended to improve operational cooperation between the Member States in the fight against VAT fraud on the model of the Eurocanet network, which was set up by the Belgian tax authorities and which is supported by the Commission and the European Anti-Fraud Office.
The third category comprises measures intended to strengthen tax authorities' capabilities with regard to the levying and collection of taxes. These include, in particular, a measure that specifies the cases in which suppliers and customers making cross-border transactions are held jointly responsible for the payment of tax. This is no doubt intended to strengthen the legal framework governing cross-border tax collection.
Finally, they include a measure intended to establish shared responsibility between the Member States in order to protect overall tax revenues.
The Commission also notes that Parliament has demonstrated an ongoing concern to ensure the protection of the European Community's financial interests, given that VAT fraud also has consequences for the European budget's own resources.
I welcome the support given to the proposal for a regulation on mutual administrative assistance in the fight against fraud and, in particular, against VAT fraud.
The Commission also welcomes the request made by Parliament to the Council to continue negotiations on this proposal, which will provide a detailed framework enabling the Commission and the European Anti-Fraud Office to provide the Member States with operational support and information as part of their fight against VAT fraud.
The positive opinion expressed by Parliament in the draft report on the cutting of deadlines and the rapid progress of the work conducted on this issue within the Council bode well for the more far-reaching proposals that the Commission will adopt in the near future.
Lidia Joanna Geringer de Oedenberg
draftsman of the opinion of the Committee on Legal Affairs. - (PL) Madam President, controlling fraud, hitherto chiefly within the province of Member States, is a problem which cannot be resolved solely at the national level. Combating tax evasion must involve closer cooperation between the administrative authorities of Member States, as well as cooperation with the Commission.
The proposals for the Directive and Regulation forming the subject of the Draft arise only partly from the priority recommendations made by ECOFIN in June 2007. The proposed changes have as their main purpose speeding up gathering and exchanging information about intra-Community procedures, by standardising the procedures and by reducing to one month the period covered by declarations on intra-Community transactions and the time limit for the exchange of information about these transactions between Member States.
Harmonisation of VAT requirements will ensure effective verification of the information provided. Requiring Member Sates to accept electronically submitted VAT returns will also significantly simplify the process.
The proposed legislative instruments represent no more than the first steps towards putting the above ECOFIN proposals into practice. We do not yet have a detailed assessment of the impact of the new formal requirements on service providers, and it would be advisable to prepare a special report dealing with this issue, especially as it relates to the administrative costs borne by taxpayers and administrative authorities and the effectiveness of combating tax evasion.
Bearing in mind the justified criticism offered by the Court of Auditors, concerning the lack of effective administrative cooperation in this area, the European Commission should consider playing a greater role, especially where preparing analyses and providing good models is concerned.
Gabriele Stauner
on behalf of the PPE-DE Group. - (DE) Madam President, ladies and gentlemen, approximately 2.25% of the gross domestic product of the EU, in figures approximately EUR 200 billion a year - as Mr Staes has already said - is lost in value added tax evasion, circumvention and fraud. Those are the facts on which Mr Staes' report is rightly based.
From the replies to five written questions on this topic which I put to the Council and Commission - by the way, I also regret that the Council is so sparsely represented - it has emerged, among other things, that in 2005 value added tax losses in Germany alone amounted to EUR 17 billion and in the United Kingdom to EUR 18 billion. These figures really make it clear to everyone that considerable damage is being done to the national economy and that this must be stopped as soon as possible.
How is this to be accomplished, however? The answer to date was - according to the Court of Auditors, which has devoted itself to this topic in a special report - through cooperation between the national administrative authorities responsible, but that is precisely what has not worked at all in recent years.
Once again Europeans find themselves in a situation where they are pursuing a well-intentioned goal but are counting their chickens before they are hatched. And in this case the chickens are the Member States which are unable to crack down on international evasion of value added tax by means of administrative measures.
Thus, for example, there are major unexplained differences in the figures for requests for information received and requests for information answered. The mirror image differences in the statistics for intra-Community trade notified by the Commission in reply to my written question of 6 May, which are supposed to have amounted to the princely sum of EUR 77 billion in 2007, may also be an indication of value added tax fraud. I would take this opportunity to ask the Commission when the results of the study will be presented to us.
Vladimír Maňka
on behalf of the PSE Group. - (SK) Colleagues, imagine that there was no tax evasion in the European Union. If the funds acquired in this way were distributed fairly, every citizen of the European Union, including children and pensioners, would have EUR 500 more in their wallet every year.
No country can combat tax evasion effectively on its own. International cooperation is imperative, especially in the VAT area, where the monitoring of intra-Community transactions is complicated by the current system. One solution with a long-term positive effect in combating tax evasion would be the creation of a VAT system under which transactions between Member States would be taxed at a rate other than zero. The zero-rate tax on exports of goods is being abused by fraudsters and criminal groups that, for example, create fictitious transactions and fraudulently drain billions of euros from state budgets.
The current long deadlines for the submission of tax returns also provide room for the commission of such tax frauds. The report on the draft directive that we are discussing now represents an acceleration of the exchange of information necessary for the fight against tax fraud. That is one of the reasons we are shortening the deadline for the submission of tax returns for intra-Community transactions.
The VAT system created in 1993 is only transitional. I believe that at the beginning of the next term of office, the Commission will present more ambitious measures dealing with final and comprehensive VAT reform. The provisional nature of the current system is one of the reasons why in my amendment, which was approved by the Committee, I request that the Commission evaluate the impact of the adopted measures three years earlier than was proposed in the original amendment proposal. This is to avoid a situation where the system would be evaluated at a time when it is no longer in force.
To conclude, I wish to thank and congratulate the rapporteur on a well-balanced report. The draft allows for an early response to tax fraud. It is also positive that business people themselves have stated that the administrative burden will be minimal.
Miguel Portas
on behalf of the GUE/NGL Group. - (PT) Madam President, when the Court of Auditors says that the volume of VAT fraud could be greater than the total budget of the Community and Mr Staes asserts that this figure must be more than doubled, the discussion of these reports is fully justified. In particular, it is obvious that Member States must support the creation of a register of natural persons who use shell companies for tax evasion. I also support the proposals of Mr Staes.
Having said this, it is not avoidance of payment of VAT that is the main problem in terms of tax evasion in Europe, because there is a type of legal evasion that is permitted and allowed by governments in the shape of offshore financial centres. It is in these centres that the proceeds of crime are laundered and legitimate funds become criminalised. When the money from our taxes is ending up being used to bail out banks and bankers, the end of tax havens is the real test of courage that is being set for Europe in the near future. That is how we will be judged and we are still light years away from what is required regarding tax evasion.
Sergej Kozlík
(SK) Madam President, honourable Members of Parliament and guests, it is indisputable that tax evasion causes significant disruption to competition and the functioning of the internal market, and reduces public revenues. The explanatory statement is not completely convincing when it states that the proposed measures, aimed solely at accelerating the collection and exchange of data relating to intra-Community transactions, will not represent an excessive burden for the entrepreneurial sector.
At the same time, the Commission's explanatory statement recognises doubts in the entrepreneurial sector regarding the ability of tax authorities to utilise the information provided. The statement does nothing to dispel these doubts. Nevertheless, the measures aimed at combating tax evasion need to start somewhere. Probably only practice will show whether the proposed measure works or becomes just another administrative burden for the entrepreneurial sector.
Bogusław Liberadzki
(PL) Madam President, I should like to consider both the report and the problem itself from the point of view of firstly fraud, secondly budget loss and thirdly distortion of business competitiveness, since tax fraud undermines the principles of fair competition.
I wish to express my special appreciation of the report and the rapporteur, Mr Staes, who has produced an excellent report. It is one of the few reports which not only refers to the amounts but also names the Member States where these irregularities occur. I also wish to express my gratitude to the Court of Auditors, which has highlighted two main groups of reasons. Firstly reasons associated with Member States, which we could interpret as a kind of passivity on the part of the Council, or inertia on the part of Member States, that could make a significant contribution to solving the problem by taking seemingly simple steps such as the prompt exchange of information, reliable exchange of information and demonstrating the will to identify and eliminate the causes of the existing state of affairs.
There is also a second important issue, which was not given sufficient prominence in the Commissioner's address: what can the Commission, together with its subordinate agencies, such as the Directorate General for Taxation and Customs Union, and the European Anti-Fraud Office (OLAF), actually do, in place of the frequently bureaucratic explanation along the lines of however much effort we make, so far it has produced no results?
Louis Michel
Member of the Commission. - (FR) Madam President, ladies and gentlemen, I should like to thank you for the observations and points of view that you have expressed during this debate.
The Commission will take account of the suggestions made by the European Parliament in its current and future legislative proposals.
I am pleased to note that the opinions of the European Parliament are similar to those of the Commission with regard to the measures to be taken to improve the fight against VAT fraud within the European Union. I am particularly happy about the widespread support for the main objective of the Commission's first concrete proposal, namely to accelerate, by January 2010, the gathering and exchange of information concerning intra-community transactions.
We have spoken about the impact assessment. The Commission has examined the effects on business costs. It appears that these costs are limited. In order to examine the real effects more precisely, the Commission is ready to produce an evaluation report. The preliminary results of the current assessment, to which you refer, Mrs Stauner, will be known during the course of the coming weeks and will then be validated in cooperation with the Member States.
The Commission, I am told, can only accept Amendments 4 and 7 of the report ...
Are you therefore unable to accept Amendments 4 and 7 of the report?
In fact, we can accept Amendments 4 and 7 of Mr García-Margallo y Marfil's report.
I apologise for proceeding in this way but I am not, as you will have noticed and as you know, the responsible Commissioner, and I am therefore far less expansive on these issues, which are extremely challenging for me, than on others.
José Manuel García-Margallo y Marfil
Believe me, Commissioner Michel, I appreciate your kindness in being here with us and dealing with topics that actually are tough for anyone.
The Commission asked us to be quick and we have responded swiftly. The Committee on Legal Affairs duly issued its opinion in good time and, in a rare show of unanimity, the Committee on Economic and Monetary Affairs approved the report that we are debating today.
Commissioner, you have read out to us the proposals that the Council adopted on 1 December, from the notes that were prepared for you in the Committee on Fiscal Affairs. Those proposals, however, are not precisely the ones that we are debating here. What we are debating is something else. I am not surprised that they have told us what they are thinking of doing, because what they have actually done is very little, as I said before.
The speed with which Parliament has acted on this really important topic, as my fellow Members have pointed out, has not been matched by enthusiasm in either the Commission or the Council.
A very important committee chairman once said that he expected 'de l'audace, encore de l'audace et toujours de l'audace' from the Commission - boldness, more boldness and forever boldness. The Commission holds a monopoly on legislative initiative, and this Parliament has wanted it to be so, but holding this monopoly means that these initiatives have to be put on show and proposed boldly and fearlessly, without holding back for fear that the Council may not approve them.
Initiatives need to be launched, pushed forward and fought for, and the Council will have to answer to the Commission and to this Parliament if the proposals are not successful. This has not been the case. What I described in my earlier speech was a story of declining ambition, from the most absolute proposals to conventional measures, to a package of measures from which only two, the most modest of them, are selected.
I am grateful to Mr Michel and ask him to pass on to the Commissioner responsible my thanks for having accepted a couple of amendments, but I feel really frustrated by what we have debated here.
Bart Staes
rapporteur. - (NL) Madam President, Commissioner, ladies and gentlemen, I can only endorse what Mr García-Margallo y Marfil had to say. To my mind, both reports, in fact the three reports that are before us, and the way in which they have been approved, by the Committee on Economic and Monetary Affairs on the one hand and the Committee on Budgetary Control on the other, demonstrate a high level of resolve - a resolve not to take this lightly.
A great deal of money is involved. Just imagine we could only recoup even a quarter of that money. We would end up with a fund of EUR 60 billion in the Member States and in the European Union. We need this money. Mr Verheugen, who is here today, knows he has an important job to do. We therefore know what we are fighting for. We are also fighting unfairness and injustice. After all, those who fail to pay their taxes, who try to evade them, display anti-social behaviour. This is therefore something that calls for resolve in this House.
I should like to say to Commissioner Michel that I understand his response. He has his own competences. He is here to replace someone else, and I can understand that he is simply reading out a response. That is not a problem. I will take his text with me, and we will work with it.
I would like to ask the Commission, though, not just to discuss the study on the extent of fraud, which should be ready by the end of the year, with the Member States, but also to submit it to the Committee on Economic and Monetary Affairs and the Committee on Budgetary Control, so that we can include a number of other aspects too.
President
The debate is closed.
The vote will take place on Thursday 4 December 2008 at 12 noon.
Written Statements (Article 142)
Sebastian Valentin Bodu
The report in question is particularly important due to the fact that it introduces mechanisms aimed at eliminating or reducing the opportunities for defrauding the budget by means of fraudulent intra-Community transactions liable for VAT.
At the moment, annual losses generated as a result of carrying out fictitious transactions involving missing traders is estimated at EUR 100 million (16% of the EU's actual resources).
Reducing the deadlines both for collecting information and exchanging it between the Member States' tax authorities can help to improve monitoring of transactions of this type.
According to an approved amendment to the report in question, put forward by the Commission, the tax authorities in the Member States will be connected to a shared database where details will be registered of the physical persons behind the missing traders responsible for carrying out fraudulent transactions of this nature.
This will deter these traders from continuing to set up other companies anywhere in the whole of the European Union, and not just in a single Member State, as happens at the moment. This will be achieved as they will be identified in real time when a check is run on the database and also because the information will be sent to the commercial register to which the application for registering a new company has been made.
Zbigniew Krzysztof Kuźmiuk
in writing. - (PL) As I take the floor in a debate devoted to combating tax fraud, I should like to draw attention to the following issues. The loss of income resulting from VAT fraud in the various Member States is extremely high, and increases every year. For instance in Germany in the year 2005 the loss was approximately EUR 17 billion and in the United Kingdom in the 2005-2006 tax year it was over EUR 18 billion.
In spite of the fact that the European Union has introduced many initiatives to combat VAT fraud, such as EUROCANET (a network for exchange of information about companies suspected of VAT fraud, which unfortunately does not include Germany, United Kingdom or Italy), and of the work of institutions such as Europol, Eurojust and OLAF, these losses increase significantly year by year.
In the circumstances, we should abandon actions leading to the creation of new intergovernmental agencies, and instead strengthen the role of the European Commission as the central coordinator of administrative cooperation between individual Member States concerned with combating VAT fraud. Consequently, it is at least debatable whether we should create a new mechanism, Eurofisc, conceived as a new decentralised network in which Member States would participate on a voluntary basis.
Andrzej Jan Szejna
in writing . - (PL) The report on combating tax evasion in relation to intra Community transactions is a very significant legal act.
Tax fraud amounts to an attack on the principle of fair and transparent taxation. It also undermines the basis on which the Union operates. Less money going into the Union's budget means we are unable to implement policies in full.
Combating tax fraud falls largely within the competence of the Member States. The latter should not, however, act in isolation. There is a clear need to coordinate work at Community level and to strengthen cooperation between the national administrations of Member States and the European Commission.
Reform of VAT is a long-term and time-consuming process. Accordingly, the report discussed states that conventional resources should be used. The latter involve changes to legislation in the area of the taxpayer's responsibility should the necessary documents not be submited on time or be submitted incorrectly. Other changes include shortening the time for obtaining the information and swift correction of inaccurate data, together with the acceleration of exchange of information linked to intra Community transactions.