"On top of today's unemployment of 20 million, it is now estimated that within 15 years a total of 5 million more jobs likely to be outsourced from Europe and the USA to Asia, Europe will need to create 22 million more jobs by 2010 alone," said UK Finance Minister Gordon Brown.
He argued that, with global production and services shifting more and more towards Asia and with Europe growing only half as much as America and one quarter the rate of China and India over the last decade, Europe needed both a common economic policy and an agreed European social model to address the unacceptable level of 20m unemployed.
"We cannot claim today's European social model is fair or effective when there are 20 million people unemployed and nearly half of them for more than a year," said Brown. Pressed on this by MEPs, he said that more could perhaps be done in this area by the International Labour Organisation (ILO), the Organisation for Economic Co-operation and Development (OECD) and that it may also be best to legislate on social policy at national level. He referred to the October informal social Europe summit as an opportunity for a "challenging, path-breaking and innovative debate" to ensure that EU countries improved their economic performance whilst keeping the social standards needed for civil societies.
In comments to MEPs, he said if the EU is not to compete with Asia on low pay, it must invest in education and lifelong learning, skills, science, R&D, technology and infrastructure to add value to goods and services. He also said that public investment in these areas fitted in with the Sapir report that UK Prime Minister Tony Blair had recently drawn, on and were central areas to the Lisbon agenda.
He set out the UK Presidency's four key points to help achieve full employment:
1) The foundation of a full employment policy is economic stability, with the changes in the Stability and Growth Pact designed to do what modern fiscal policy must do - take into account better the economic cycle, the importance of investment and levels of debt.
2) A European wide political commitment to complete the single market by holding to timetables for the opening up of sectors from energy to utilities, developing a more independent competition policy, using in-depth market investigations.
3) A modernised approach to regulation including a cost test, a competitiveness test and a risk-based approach rather than blanket regulation.
4) A long-term commitment to a more open trading relationship with the rest of the world through an ambitious outcome to the WTO talks in Hong Kong, an enhanced dialogue with India, China and the rest of Asia and to agree a road map to creating a genuinely barrier - free transatlantic financial market.
Pressed on the financial perspectives, Brown reiterated that the UK had not been the only country opposing an agreement at the recent EU summit and that "it did not make sense for the EU to devote 40% of the budget to one sector [the CAP] accounting for 4% of the EU jobs and 2% of its output."