MEPs back compromise service directive

THE controversial Services Directive cleared its first hurdle when the European Parliament voted for it by a clear majority.

The result could see German undertakers offering funerals in Ireland, Irish doctors setting up nursing homes in Italy and Hungarian firms dealing with weekly rubbish collection.

A compromise by conservatives and socialists in the Strasbourg parliament saw the death of the country of origin principle where workers could be bound by the rules and wages of their home country even in wealthier member states.

Employers will now have to abide by national pay agreements while companies providing services will have to abide by the standards of their host country.

But while trade unions and socialist MEPs cheered the death of social dumping, employers’ groups said the watered-down version would not create the kind of jobs the original promised.

Internal Market Commissioner responsible for the Directive, Charlie McCreevy, was criticised by both left and right for his hands-off approach to the piece of legislation he inherited from his predecessor.

Seldom has a piece of legislation created such fury and division in Europe. Mr McCreevy was provided with personal bodyguards in the lead up to the vote that saw 40,000 protestors outside the parliament.

He welcomed the vote and said there was now a political momentum behind the directive that could see it accepted by the member states, probably in June.

Ireland and Britain were the most open countries to foreign competition and would have fewer barriers to dismantle than other EU members, he said.

Fianna Fáil MEP Eoin Ryan said the removal of barriers to services will create great opportunities for Ireland, where the services industry has quadrupled over the past seven years. But he regretted the watering down of the directive.

Dublin Labour MEP Proinsias De Rossa warned the Irish government and Mr McCreevy not to try going back on these in the next stage of the bill.

“The original directive is a symbol of the kind of Europe people do not want,” he said.

Employer groups such as UNICE criticised the outcome while most MEPs from the new member states voted against the bill because it makes their workers and services less competitive in wealthier states.

The French Socialists voted against because they believe it represents a race to the bottom in wages and standards.