The "open method of co-ordination": Innovation or talking shop?

At the 'dot.com' Summit AT Lisbon in March 2000, the EU set itself the strategic goal of creating full employment in a competitive and inclusive knowledge-based economy. To reach this goal, EU prime ministers announced the adoption of 'a new open method of co-ordination', which is based on benchmarking and spreading best practice. It is intended to help member-states converge towards common objectives in areas such as employment, economic reform and social cohesion.

The new method works in four stages. First, EU ministers agree on policy goals in the area concerned. Second, member-states translate these guidelines into national and regional policies, with specific targets. Third, the ministers agree on benchmarks and indicators, to measure and compare best practice within the EU and worldwide. Finally, through evaluation and monitoring, member-states' performances are assessed - relative to each other and to their declared goals.

Advocates of this 'soft' (i.e. not law-based) approach argue that it enables member-states to co-operate closely, yet recognises their diversity and avoids forced harmonisation. It allows co-ordinated action in areas where it would be politically difficult, or even impossible, to move forward through a common policy or legal framework. It allows for a concerted EU approach while leaving legal competence and authority with the individual member-states. Thus progress can be made through open co-ordination where otherwise there would be none.

Critics fear, however, that open co-ordination is at best a talking-shop and at worst a weapon aimed at the traditional "community method" of European integration. They view the new approach as a Trojan horse for more "inter-governmental" decision-making. Whether they are right will become apparent as the targets of the Lisbon summit are met - or not - over the next few years. The more difficult question is whether it is indeed another tool for integration, or rather a move towards increased, and perhaps less effective, inter-governmentalism.

At Lisbon, the EU leaders suggested that open co-ordination should apply to areas such as social exclusion, enterprise and e-Europe, where most or all powers remain with the member-states. In social exclusion, for example, the only way for the EU to play a role in such a politically-sensitive area was for the Council of Ministers to agree in October 2000 on a set of common, but not legally-binding, objectives for tackling poverty and exclusion. The member-states will produce national action plans for reaching these objectives, on which the Commission will then comment.

But will open co-ordination really prove effective and gain acceptance among the member-states? The European employment strategy, established at the Luxembourg European Council in November 1997, is the longest-running example of this method. Unlike some of the newer areas subjected to open co-ordination, the employment strategy has a treaty base that allows the Commission to put guidelines and recommendations to the Council for agreement. As the proposals have no legal force, the political effectiveness of the new method rests on the strength of the political commitment to the process, on its perceived value and utility, and on peer pressure and public support.

After it's first three years, the employment strategy is clocking up results. The unanimously-agreed guidelines cover policies ranging from active labour market measures to help the long-term unemployed, to equal opportunities. In some cases, such as Spain and its labour market, the EU-wide policy consensus has helped governments to push through difficult reforms.

It remains to be seen whether open co-ordination can boost the EU's progress towards a competitive, knowledge-based economy. But it is a fact that this method has allowed the EU to extend the concept of joint action into new policy areas. And it gives a key role to the Commission, not only in analysing best practice, but also in drafting guidelines and issuing recommendations on improving the effectiveness of policies. It is early days for this new method of open co-ordination, and perhaps it needs a catchier, more media-friendly name. But so far it looks like an important new addition to the EU's policy-making toolbox.