Sir Digby Jones, Director-General of the Confederation of British Industry (CBI), Speaks out on the "Brussels Elite", the Urgent Need for European Reform and Better Skills Provision, and What the Young Manager of Today Should Be Learning
EBF: Policy makers and politicians in Europe are split over the Lisbon Agenda. Some are saying that it is still on track, while some are saying that it will never happen. What is your view?
DJ: I actually don't think the Lisbon Agenda is on track at all. In fact, I'm amazed that anyone can even think that. It's perfectly obvious that you can't get something like the Lisbon Agenda really moving forward unless political leaders stop just saying that they believe in it, and actually show by their actions that they believe in it.
Europe has been inward looking for far too long. The 19th century belonged to Britain and the 20th century belonged to the US. The 21st century belongs to Asia. Europe now has a real challenge. If it reforms its economy and its working practices, and if it drives forward with research and development, technology and skilling, then - with a lot of fiscal support--it has a chance of competing with Asia.
However, we won't stand a chance if we continue as things are. With the whole weight of the Brussels elite throwing bucketloads of money into "yesterday" (the Common Agricultural Policy springs to mind) and refusing to reform antiquated labour market regimes, there will be no chance of getting the 22 million people in Europe who are currently out of a job, into a job. Instead, we will get loads of regulation and money keeping those who are in work, in work. And nothing will ever change. So, do I think the Lisbon Agenda is on track? No, I don't.
EBF: You spoke of the need for reform. Do you see any signs that reforms are happening, or will happen?
DJ: In Peter Mandeison, Neelie Kroes, Gunter Verheugen (see pages 7-8, issue 22) and Jose Manuel Barroso, we've got some very reformist-minded commissioners. The CBI fully supports the reformist agenda of these commissioners. I wish them well, and I think they are on the right track.
However, they will only succeed if there is a serious change in the attitudes of domestic governments. Unless we see a dramatic shift in the way that domestic politics is run in countries like France and Germany, with more deregulation and reform, then they haven't a hope in Brussels.
EBF: In your opinion, what sort of attitudes need to change?
DJ: Let me give you an example. In France, we have Jacques Chirac increasing the taxes on airline tickets to help alleviate poverty in Africa. But he does nothing towards the one thing that really would help, which is to remove the tariffs and the subsidies of the Common Agricultural Policy. This would let Africa grow and develop its commodity crops, which it can then sell around the world and make money. By contrast, look at British farmers. They've reformed, they've jumped through every hoop, they have really made an effort yet they get nothing for it. The hypocrisy of the Common Agricultural Policy has got to stop.
EBF: Hypocrisy is a strong word.
DJ: Here is another example. Brussels has just passed a regulation, as we all know, saying that you can't advertise cigarettes on motor-racing cars any more. At the same time, this self-same Brussels elite last year spent [euro]650m of taxpayers' money subsidising the tobacco-growing industry in Europe. Now is that hypocrisy, or what?
EBF: You mentioned earlier that the 21st century belongs to Asia. Do you believe that offshoring and outsourcing to Asian countries are a threat? Or are they an opportunity?
DJ: They represent a huge opportunity. Offshoring and outsourcing have put [pounds sterling]16bn into the British economy since 2000. In Britain, we have virtually no unemployment, and we've got a skills shortage. So if you can let go of the work which is commodity-based, you can concentrate instead on skilling the people into the value-added work of tomorrow. The end result is that people earn more money. This means that they have more disposable income; they can cut down their debt, or invest in their pensions, or spend it on the high street. …