The Competitiveness Advisory Group (CAG) advises the European Union on economic policies, effectively doubling the voice of the ERT. It is a hybrid body, composed of business leaders, trade unionists, politicians and academics, set up on the instigation of the Roundtable.1 Its composite identity has made the CAG into a very effective instrument to lend extra credibility to the competitiveness mantra, at the same time institutionalizing the access of the ERT to EU decision-making structures.
The Competitiveness Advisory Group was baptised by Commission President Santer in February 1995. The mandate of this new body was to produce a bi-annual report “on the state of the Union’s competitiveness”.2 Santer also asked the CAG to “advise on economic policy priorities and guidelines with the aim of stimulating competitiveness and reaping its benefits”.
Santer hand-picked 13 members for the CAG, among them ERT members Floris Maljers (Unilever), Percy Barnevik (Asea Brown Boveri) and David Simon (British Petroleum). The rest were CEOs of other corporations and banks, the former President of Treuhand3, three trade unionists and a number of politicians, including former Italian Prime Minister Ciampi who became CAG Chairman.
Since its founding, the CAG has produced four reports4, each one published just a few weeks before a European Council meeting, and including recommendations to decision-makers which bear close resemblance to the advice given by the ERT. The second CAG report, for example, issued a few weeks before the December 1995 EU Summit in Madrid, calls for more funding for TENs, since “demand for efficient, cost-effective infrastructure is growing rapidly, but Europe faces a marked shortfall in public funds available for investment”. The report moreover demands “faster privatization and liberalization, tempered by greater competition and a new role for the state as regulator”.5
In its third report, issued in June 1996 and discussed at the EU Summit in Florence, the CAG worries about reactions to mass unemployment in Europe and calls for social pacts between employers, labour and government “to counter the threat of disruption”. This report recommends greater flexibility in working hours, wage moderation, more mobility between companies, regions, and countries, and greater effort towards the production of a cost-benefit analysis of the EU social legislation.6 Other CAG reports stress the urgent “necessity of the completion of the Single Market” and of the introduction of benchmarking as a tool to “improve competitive performance”.
In the media, the CAG is portrayed as an independent advisory group composed of top industrialists, trade unionists and academics. Although the ERT link is absent in the media reports, it is impossible to deny. The ERT first proposed the creation of such a body in its December 1993 report Beating the Crisis, and repeated the suggestion the following year. ERT Secretary-General Keith Richardson explains: “The original idea was fundamentally put together by Floris Maljers and me. The first idea was not accepted, so we changed the format and the final idea was accepted at the Essen Summit”.7
Keith Richardson is satisfied with the work of the CAG. “It has done a lot of good work. It has produced four excellent reports, and now they are preparing a new team for another two years. We have been closely in touch with them all along”.8 Commenting on the presence of three trade unionists in the CAG, Richardson notes that “the fact that they have signed onto the CAG reports gives them extra weight”.9
The CAG has allowed the ERT to present its recommendations through a body with official EU status. The ERT’s need to expose itself has therefore decreased, which could explain why it has launched significantly fewer reports on the general direction of EU policies since the founding of the CAG. The ERT can now continue its work behind the scenes, and can rest assured that its voice is being strengthened by a body with the status of official advisor to the European Union.
1. ERT, Beating the Crisis, Brussels, December 1993. |back to text|
2. Santer’s introduction to the first CAG report, Enhancing European Competitiviness, June 1995. |back to text|
3. The German state agency responsable for the privatisation of former East German state enterprises. |back to text|
4. The first two reports were titled Enhancing European Competitiveness (CM-91-95-479-EN-C and CM-92-95-659-EN-C), the third one Competitiveness and Employment ((CM-96-96-190-EN-C) and the last one EU’s Competitiveness in Danger (CM-98-96-994-EN-C). |back to text|
5. Financial Times, 13 December 1995. |back to text|
6. Financial Times, 12 June 1996. |back to text|
7. Personal interview with Keith Richardson, Brussels, 21 February 1997. |back to text|
8. Ibid. |back to text|
9. Ibid. |back to text|
10. Ibid. |back to text|