FIEC FLASH – APRIL 2008Published 7/5/2008
European Construction Industry Federation
FIECFLASH
N°58, APRIL 2008 - PUBLISHED 10 TIMES A YEAR
SUMMARY
Editorial
The TENs: still a priority for FIEC
I. Steering Committee, Council and General Assembly
1.Steering Committee
2.Council
3.Congress/ General Assembly
4.Meetings with EU policy makers
II. Current issues
A. ECO
1.EUROSTAT: construction output up by 1.2% in the euro area between January and February 2008
2.Internalisation of external costs: draft proposal for the review of the “Eurovignette” Directive
3.Initiative on “green VAT”: FIEC and ACE to lobby jointly in the ECF
B. SOC
1.The “Rüffert” Case : what impact on the “Posting” Directive ?
2.The Commission presents a Recommendation on the “Posting” Directive
3.Commissioner Spidla presents the European Social Agenda for 2008-2009
C. TEC
1. Waste Framework Directive: ENVI Committee votes amendments at 2nd Reading in European Parliament.
2. SMOPYC Zaragoza 2008: venue for TEC-4 meeting.
3. CEN/TC 350 “Sustainability of Construction Works” - Vienna Plenary Meeting
D. SME
E. TENs
1. New Ad-Hoc Working Group chaired by Vice-President Luisa Todini
2. TENs short news
F. MEDA
1. MEDA newsletter
G. Speeches/ Presentations on behalf of FIEC
H. Members Corner
1. Current deadlines for response
2. Internal forthcoming meetings
3. EIC / CICA / Member Federations
4. External Meetings
Editorial
Luisa Todini, Vice-President
The TENs: still a priority for FIEC
The development of a comprehensive and efficient transport network is the starting point for any modern economy wishing to strive for its growth, competitiveness and cohesion.
It is for these reasons that in 1994, during the “Essen Summit”, the European Heads of State and Government decided to define and promote the so-called Trans-European Transport Networks (TENs), composed of 14 trans-national priority projects. The list of priority projects was extended in 2004 to take into account EU enlargement and now comprises 30 priority axes.
Given their crucial role, the development of the TENs is an increasing priority for FIEC who over the years has developed, a constructive relationship with EU Institutions on this matter, in particular the European Commission’s Directorate General for Energy and Transport, under whose responsibility TENs fall, and the European Investment Bank (EIB); Furthermore, FIEC regularly publishes its “Blue Book”, on the status of the TENs priority projects as a tool to report annually from the perspective of contractors.
The main finding of this annual survey is that the realisation of such projects is suffering significant delays, mainly due to financing difficulties, as well as from a lack of political will among Member States.
Further significant efforts, both at European and national levels, are therefore urgently needed.
For this reason the FIEC Steering Committee has entrusted me with the task of chairing a dedicated FIEC Ad-Hoc Working Group on "Trans-European Transport Networks", in order to strengthen our lobbying on this matter.
Our action is focused on 2 specific tasks, namely:
- the drafting of the 15th edition of the FIEC “Blue Book”, to be published for the forthcoming Congress in Dublin, and
- providing input to the European Commission (EC) in view of their future Green Paper aiming at opening a wide consultation of overall EU policy concerning TENs.
As regards the latter point, we are currently working on the FIEC contribution to the EC and without entering too much into the detail of the various items we will address, I would like to highlight here one of the issues that I consider extremely important and which I supported in my former duty as Member of the European Parliament.
Member States who intend today to invest in carrying the TENs project forward have to carefully consider budgetary restrictions laid down in the “Stability and Growth Pact” (the so-called “Maastricht criteria”).
On the other hand, as mentioned above, the TENs play a crucial role in the growth, competitiveness and cohesion of the European Union, in particular in the aftermath of the latest waves of enlargement.
This is the reason why special consideration on investment in such infrastructure should be taken into account by European institutions, as recent studies coming from the European Parliament have also suggested. In addition, it is even possible to imagine the launch of a European long term loan, to take advantage - and also mitigate the deleterious effects – of the strength of the euro on money markets.
Looking at the problem from the point of view of the Member States, PPP (Public Private Partnerships) initiatives should be implemented as a priority in order to create political consensus around this model of project financing.
Many other initiatives, of course, could be carried out, but new possibilities of using financial resources at national and European levels will certainly facilitate and encourage Member States in respecting commitments taken nearly 15 years ago in Essen.
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FIEC FLASH – N°58, APRIL 2008
Published by: FIEC, European Construction Industry Federation
Avenue Louise, 225– B-1050 Bruxelles/Brussel
Tel: (+32 2) 514.55.35 – Fax: (+32 2) 511.02.76 – E-Mail:–
FIEC FLASH – APRIL 2008Published 7/5/2008
I. Steering Committee, Council and General Assembly
1.Steering Committee
At the invitation of Vice-President Johannes Lahofer (Treasurer), the Steering Committee gathered in Vienna on 18th April 2008 and addressed, among others, the following issues:
Contacts with the Polish and Russian contractors' associations.
A new proposal concerning the subscription calculation method submitted by the German federations, which will have to be analysed in more detail by the next Steering Committee.
The activity reports of the Commissions and Ad-hoc Groups.
The (positive) financial results of 2007 and the subscriptions 2008 received.
The candidacies received for the elections in the Dublin General Assembly.
Meeting with (UEAPME President Georg Toifl, Secretary General Andrea Benassi and HelmutHeindl, the Director of the Austrian crafts organisation (member of UEAPME)
The main issue was to discuss the follow-up of FIEC's request to become an associate member of UEAPME. For the time being, it seems that the vast majority of UEAPME member federations, in particular the associate member EBC, are opposed to FIEC's associate membership and therefore the UEAPME representatives considered that it will be necessary to progress step by step.
UEAPME works with committees and forums, the latter organised by the sectoral associations, associate members of UEAPME, amongst them the "construction forum". FIEC could immediately enter this forum, with all rights except voting in the General Assembly (a right that associate members,in any case, do not have). In participating in the "construction forum", FIEC would become a member of the family and wouldbe able to ascertain whether this scheme is workable, in this way, FIEC does not have to run blindly into UEAPME.
All of this would,in return, require an autonomous place for EBC in the European Social Dialogue.
A specific memo on this issue is in preparation and will address this meeting as well as another meeting scheduled for 22/5/2008 in Brussels.
2.Council
a)The draft minutes of the meeting held in Brussels on 7/12/2007 are available on the FIEC website.
b)The next "Presidents' only" and General Assembly/Council meetings will take place in DUBLIN on 19th June 2008.
3.Congress/ General Assembly
a)Congress 2008: Dublin, Ireland, Thursday 19 – Saturday 21/6/2008
b) Congress 2009: Madrid, Spain, Thursday 18 – Saturday 20/6/2009
c)Congress 2010: Initial discussions under way
4.Meetings with EU policy makers
7/4(DT, JJM, UP) Commissioner Janez Potočnik (Slovenian, Science and Research)
JP suggested, in particular, meeting regularly with his services, in order to ensure that the construction industry is taken into consideration in the various programmes.
10/4(DT, UP, JWG) Brussels ACE Conference (Architects)
The keynote speaker Riccardo Petrella proposed that all land should be owned by the public sector, as "res publica", and suggested that PPP should mean "the programming of policy privatisation". The audience applauded rapturously.
10/4(DT, JJM) Transport and Sustainable Mobility Conference, ECOSOC, Paris,
Conclusions by Commissioner Jacques Barrot
24/4(DT, JJM, UP) Peter Carl DG Environment
Referring to recent studies, PC fully acknowledged that fiscal measures favouring increased energy savings and reduced greenhouse gas production in the built environment would be less costly and more efficient than trying to achieve similar improvements in the area of transport. However, he stressed that the EU does not have any mandate for the former, so that the Commission can only propose measures concerning the latter.
24/4(DT, UP) Stephen Bill, Head of Cabinet of Commissioner Kovacs (Taxation)
(see detailed report circulated at the end of April)
25/4(DT, JJM, UP) Paris, Conference speakers Françoise-Héléne Jourda and Pascal Payat
28/4Conference organised by "Espace Equipement Europe" on "Sustainable Transport"
Brussels, Commissioner Jacques Barrot
II. Current issues
A. ECO
1.EUROSTAT: construction output up by 1.2% in the euro area between January and February 2008
According to preliminary estimates released by Eurostat, seasonally adjusted production in the construction sector grew by 1.2% in the euro area (EA15) and by 2.2% in the EU27 in February 2008, compared with the previous month. In January, production increased by 2.5% in the euro area and by 1.6% in the EU27.
Compared with February 2007, output in February 2008 rose by 4.3% in the euro area and by 5.0% in the EU27.
Monthly comparison
Among the Member States for which data is available for February 2008, construction output rose in ten and remained stable in the Netherlands and Slovakia. The most significant increases were recorded in the UnitedKingdom (+7.1%), Romania (+5.2%) and Poland (+4.6%).
Building construction rose by 0.7% in the euro area and by 1.6% in the EU27, after +2.4% and +1.7% respectively in January. Civil engineering increased by 3.2% in the euro area and by 3.9% in the EU27, after +1.9% and +2.9% respectively in the previous month.
Annual comparison
Among the Member States for which data is available for February 2008, construction output rose in eleven and fell only in Spain (-5.6%). The largest increases were recorded in Slovenia (+41.6%), Romania (+36.6%) and Poland (+18.6%).
Building construction grew by 4.1% in the euro area and by 4.3% in the EU27, after +3.1% and +2.9% respectively in January. Civil engineering increased by 3.9% in the euro area and by 6.7% in the EU27, after +3.1% and +3.3% respectively in the previous month.
Notes :
The production index in construction approximates to the evolution of output within the sector, broken down into building construction and civil engineering.
The seasonally adjusted euro area and EU series are calculated by Eurostat by aggregating the working day adjusted series from individual Member States and making an adjustment for seasonal effects on this series.
From 1st January 2007 the euro area (EA 13) consists of Belgium, Germany, Ireland, Greece, Spain, France, Italy, Luxembourg, the Netherlands, Austria, Portugal, Slovenia and Finland.
2.Internalisation of external costs: draft proposal for the review of the “Eurovignette” Directive
The European Commission will present in mid-June a proposal for the review of the “Eurovignette” Directive (taxation of heavy goods vehicles for the use of certain road infrastructure), which will take into account external costs (congestion, pollution, road accidents) caused by the transport sector.
According to a draft version of the future proposal, Member States will be able to opt, on a voluntary basis: for the current system for calculating charges applied by some Member States or put in place new charges on external costs resulting from air and noise pollution and congestion; or a combination of both.
According to the current directive that entered into force on 10th June 2006, Member States are allowed to charge tolls depending only on infrastructure needs (construction, operating and development costs).
In the future Commission’s proposal, external cost charges should have to meet 3 criteria:
1)charges must vary according to time and location of use;
2)revenues from these charges should be earmarked for measures to reduce the deleterious effects of transport (projects to reduce pollution at source, traffic management, alternatives); and
3)these charges should be paid through an electronic system interoperable across Europe.
Furthermore, external costs will be calculated by independent authorities – rather than by infrastructure managers as at present – specifically designated for this task and according to common standards set out in the directive.
As at present, the directive will concern heavy goods vehicles of over 3.5 tonnes. However the scope of the current directive will be extended to all roads in order to avoid traffic rerouting on secondary axes. Until now, only roads which are part of the Trans-European Transport Network were concerned by the directive.
Member States should have until the end of 2010 to incorporate the necessary amendments into national legislation and the new arrangements should be in place before 31 December 2013.
3.Initiative on “green VAT”: FIEC and ACE to lobby jointly in the ECF
Following the initiative on “green VAT” applied to some energy-efficient and energy-saving products, launched by the Council and led by France and the UK (cf. FLASH of March 2008), the Architect’s Council of Europe (ACE) has proposed to jointly launch a lobbying campaign within the European Construction Forum (ECF).
During its latest meeting held on 18th April 2008 in Vienna, the Steering Committee unanimously agreed to cooperate with the other ECF members on this issue, recalling that such a reduced “green VAT” should concern above all construction services such as installation and renovation services and not simply the materials themselves.
For further information on the ECO Commission please contact Christine Le Forestier at the FIEC Secretariat (; Tel: +32 2 514 55 35).
B. SOC
1.The “Rüffert” Case : what impact on the “Posting” Directive ?
On 3/4/2008 the European Court of Justice (ECJ) issued its judgement in the so-called “Rüffert” Case (C-346/06), after the lawyer acting as the administrator of the bankrupt company “Objekt und Bauregie”.
This case concerns the application of the law of the German State of Lower Saxony on the awarding of public contracts, which states, amongst others, that public works contracts may be awarded only to undertakings which commit themselves in writing to pay their employees at least the remuneration prescribed by the applicable collective agreement. The contractor must also apply this obligation to its sub-contractors and monitor their compliance with it. The consequences of non-respect of these rules was the application of a penalty of 1% of the contract value for each case, with a maximum of 10% in total.
In the light of these provisions, the company “Objekt und Bauregie” undertook to pay its employees working on the Göttingen-Rosdorf prison building site the wages laid down in the “Building and public works” collective agreement which applied to this case.
However, following an inspection, it emerged that a Polish subcontractor of “Objekt and Bauregie” was paying its workers on the same building site only 46.5% of the prescribed minimum wage. The subcontractor was punished for this infringement of mandatory working conditions.
Both the client and the contractor terminated the works contract and legal proceedings started between the State of Lower Saxony and “Objekt und Bauregie” in order to determine whether the application of the penalty clause (of approximately 1% of the amount of the contract) allowed the client to set this penalty off against the contractor's claim to be paid for the work done.
Uncertain as to the lawfulness of the public procurement law, the Regional High Court (civil matters) asked the ECJ to decide whether the freedom to provide services precludes a legislative obligation such as the one in force for public contracts in the State of Lower Saxony.
In its judgement the ECJ indicated that the provisions at stake are incompatible with the EU “Posting” Directive. This jugement will now be taken into consideration by the Regional Higher Court in the main litigation.
“Where a Member State recognises a system for declaring the rate of pay fixed by a collective agreement to be universally applicable but fails to make such a declaration, a legislative measure of that Member States applicable to public contracts cannot impose a requirement on providers of cross-border services who post workers to that Member State to comply with that rate of pay”.
According to the ECJ, the rate of pay provided for by the “Buildings and public works” collective agreement was not fixed according to the procedures laid down in the “Posting” Directive: although Germany has a system for declaring collective agreements to be of universal application, no such declaration appears to have been made in respect of the collective agreement in question.
Furthermore, still according to the ECJ, the “Buildings and public works” collective agreement covers only a part of the construction sector, since it does not apply to private contracts and has not been declared universally applicable.
The ECJ therefore considers that the legislation of Lower Saxony does not comply with the provisions of the “Posting” Directive, which, subject to certain conditions, allows the Member States to impose minimum rates of pay on undertakings established in other Member States in the framework of the cross-border provision of services.
Although at this stage, it is difficult to say what the impact of this judgement will be, the European Trade Union Confederation (ETUC) considers that in the light of this judgement, as well as of the previous “Viking” and “Laval” cases (see FIEC Flash nr.56 of February 2008), the ECJ is giving a very restrictive and highly questionable interpretation of the “Posting” Directive which “...in effect is an open invitation for social dumping”.
There is an increasing feeling on the side of the trade unions that a revision of the “Posting” Directive may be needed.
During the last Social Dialogue “Employment” meeting on 15/4/2008, FIEC restated its position to EFBWW, namely that the “Posting” Directive should NOT be modified.
This position was already confirmed in a joint FIEC-EFBWW position paper dated 11/12/2007 regarding a Communication of the European Commission: “FIEC and EFBWW reconfirm that the Posting of Workers Directive does not need to be revised, and is a well balanced instrument for achieving the objectives of articles 49 and 50 of the EC Treaty, including fair competition and social protection”.