Is the OMC an Alternative to the Community Method?

1. Is the OMC an Alternative to the Community Method? Jonathan ZeitlinUniversity of Wisconsin-Madison

2. I. The OMC and the Community Method • Origins and definition • Announced as a broadly applicable new governance instrument for the EU at March 2000 Lisbon Summit • Built on new Treaty-based policy coordination processes introduced during the 1990s • Broad Economic Policy Guidelines (BEPGs) • European Employment Strategy (EES) • OMC defined at Lisbon as a specific ensemble of procedural elements involving iterative benchmarking of national progress towards common European objectives and organized mutual learning • A 4-step governance architecture modeled on the EES

3. Diffusion and procedural variations • Lisbon European Council authorized application of OMC to a wide range of policy areas: • Including R&D/innovation, information society/eEurope, enterprise promotion, social inclusion, education/training • OMCs later introduced in other fields, e.g. pensions, health care, youth policy, better regulation, culture • Wide procedural variations • Many new OMC processes did not include full Lisbon governance architecture, but only fragmentary elements (e.g. European Action Plans, objectives, targets, scoreboards, indicators, peer review, etc.)

4. OMC as a new pathway for European integration • OMC explicitly conceived by its architects as a new pathway for European integration • Especially suited to complex, domestically sensitive policy fields where there is a perceived need for European action, but • Treaty powers are weak, and the EU has limited competences • MS are reluctant to transfer new powers to the Union • National diversity precludes harmonization • A ‘third way’ between intergovernmentalism and supranationalism (Larsson)

5. OMC as a threat to the Community Method • Rapid diffusion of OMC after Lisbon  widely voiced concerns that such‘soft-law’ procedures represent a threat to the CM • Defined as binding legislation initiated by the Commission, enacted by the Council and the Parliament, and enforceable by theECJ • Has led to repeated demands that OMC should not be used when legislative action under the CM is possible • E.g. White Paper on Governance (2001), debate on constitutionalization of OMC at Convention on the Future of Europe, EP resolution on the use of ‘soft law’ instruments (2007)

6. Conflicting or complementary approaches? • OMC never intended to serve as sole governance instrument for Lisbon Strategy • Always supposed to be combined with full set of EU policy tools (legislation, social dialogue, Community Action Programs, structural funds) • No evidence that OMC has displaced EU legislation, even in the social policy field • Rejection of Commission proposals for application of OMC in immigration and asylum

7. Interpenetration of OMC and Community instruments • Often an ‘integral continuity’ between OMC objectives/guidelines and legally binding norms embodied in EU directives (Kilpatrick) • Directives often include non-mandatory recommendations which may be enacted into national law (Falkner) • Part-time work, parental leave, gender equality, disability rights, occupational pensions • Growing programmatic integration of structural funds with OMC objectives (employment, social inclusion) • Use of EU community action programs (now unified as PROGRESS) to support participation by non-state and local/regional actors in EES and social inclusion OMC

8. ‘Hard’ vs. ‘soft’ law: an elusive distinction • ‘Hard-law’ directives increasingly incorporate provisions for completion and periodic revision through ‘soft-law’ OMC-style procedures • Water Framework Directive (2000) • Broad, open-ended goals: MS required to achieve ‘good water status’ by 2015 through integrated basin management • ‘Common Implementation Strategy’ for assisting MS in achieving goals & reconciling diverse approaches • Nested organization of EU, national, & non-state actors • Regular reporting, monitoring, & evaluation of national plans • Generates non-binding guidance documents, which can feed into Commission legislative proposals & comitology decisions

9. OMC and experimentalist governance • OMC as one element in a larger architecture of experimentalist governance in the EU, which is transforming the ‘Community Method’ • Based on recursive processes of framework rule making and revision in light of practical experience of implementation in diverse contexts through networked deliberation among European and national actors • Diffusion across multiple policy areas • Telecoms, energy, drug authorization, occupational health & safety, environmental protection, food safety, maritime safety, financial services, competition, state aid, anti-discrimination, fundamental rights (+ others)

10. II. The OMC in Action • Most widespread critique of OMC has focused less on potential threat to the CM than on its limited effectiveness & lack of impact on MS • Much of this debate, both in academic and policy circles, suffers from serious empirical deficits • Reliance on narrow range of often outdated evidence/studies • No systematic evaluation of OMC processes in mid-term review of the Lisbon Strategy • Compounded by methodological problems of assessing the causal impact of an iterative policymaking process based on collaboration between MS and EU institutions without legally binding sanctions

11. Advancing the European knowledge economy through OMC: a failure? • Weak performance of innovation/information society initiatives within Lisbon Strategy • Lack of progress towards 3% R&D target • Limited impact/visibility of eEurope policies • ‘Lite’ OMC recipes and fragmentary architectures • European Action Plans, objectives, targets, indicators, benchmarking/scoreboards • But no agreed National Action Plans, systematic monitoring/reporting, peer review, or country-specific recommendations; weak mutual learning mechanisms • External evaluation (Tavistock Institute 2005): OMC in these areas ‘cannot yet be said to be a success or failure’: ‘simply has not been fully implemented’

12. The OMC in action: employment and social inclusion • Employment and social inclusion: most fully developed and institutionalized OMC processes • Now a substantial body of empirical research, based on both official and independent sources • Synthetic overviews in Zeitlin & Pochet (2005); Heidenreich & Zeitlin (forthcoming)

13. OMC in employment and social inclusion: a qualified success • Improvements in EU employment performance • Structural improvements, 1997-2001 • Slower but continuing progress, 2002-6 • But connections to EES complex and uncertain • Substantive policy change • Increased political salience & ambition of national employment and social inclusion policies • Broad shifts in nat’l policy thinking (cognitive shifts) • Changes in national policy agendas (political shifts) • Some influence on specific reforms/programs (policy shifts) • Two-way interaction between OMCs and national policies rather than one-way impact

14. OMC in employment/inclusion:a qualified success (2) • Procedural shifts in governance/policymaking • Horizontal integration across policy areas • Improved statistical and steering capacity • Vertical coordination between levels of governance • Participation of non-state/subnational actors • Particularly strong mobilization in social inclusion • Uneven but growing participation in EES • Social NGOs and local/regional authorities more active than social partners

15. OMC in employment and inclusion: a qualified success (3) • Mutual learning • Identification of common challenges and promising policy approaches • Enhanced awareness of policies, practices, and problems in other MS • Statistical harmonization and capacity building • MS stimulated to rethink own approaches/practices, as a result of comparisons with other countries and ongoing obligations to re-evaluate national performance against European objectives

16. OMC in employment and inclusion: limitations • Lack of openness and transparency • Dominant role of bureaucratic actors in OMC processes at both EU and national level • Weak integration into national policy making • NAPs as reports to EU rather than operational plans • Low public awareness and media coverage • Little bottom-up/horizontal policy learning • Few examples of upwards knowledge transfer and cross-national diffusion from innovative local practice

17. A reflexive reform strategy • Overcome limitations of existing OMC processes by applying method to its own procedures • Benchmarking, peer review, monitoring, evaluation, iterative redesign • Ongoing reforms as evidence of practical viability of this approach • Strengthening of peer review/mutual learning programs (EES, social protection/inclusion) • Proposals by EU institutions for greater openness, stakeholder participation, and ‘mainstreaming’ of OMCs into domestic policy making (2003-6)