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Last Updated: Wednesday, 8 February 2006, 13:10 GMT
EU says eastern workers are good
Eastern European agriculture workers in the UK
Labour flows are too small to affect EU markets, the commission says
The European Commission says the UK, Ireland and Sweden have reaped economic rewards from opening their labour markets to workers from Central Europe.

In a report published on Wednesday, it says the new workers from states which joined the EU in 2004 have boosted growth without increasing unemployment.

Most older EU member states restricted access to their labour markets.

They have until the end of April to decide whether to continue the restrictions for another three years.

Be proud and take advantage of the sheer energy, dynamism and hard work that people from the new member states bring
Trade Commissioner Peter Mandelson

On Tuesday, Trade Commissioner Peter Mandelson called on Europe's political leaders to "Have courage - put away your fears".

"Be proud and take advantage of the sheer energy, dynamism and hard work that people from the new member states bring," he said.

His call was echoed by British Conservative MEP Philip Bushell Matthews on Wednesday, who said the countries of "old" Europe were "showing themselves at their protectionist worst" on the issue.

Germany and Austria have indicated that they will extend restrictions on workers from the new member states.

Finland and Spain have said they will drop restrictions from 1 May.

Some other countries, including Belgium, France and the Netherlands, are reported to be considering opening up some sectors of their economies.

Divisions

The report is said to have caused divisions within the European Commission, with Industry Commissioner Guenter Verheugen and Foreign Relations Commissioner Benito Ferrero-Waldner - from Germany and Austria - battling to water it down.

Regional Policy Commissioner Danuta Huebner, from Poland, fought in the opposite corner.

Among the points made in the report are:

  • Countries that have opened their labour markets fully are "upbeat"
  • Migration flows have had a "positive effect" on Europe's economy
  • The flow of workers has not been big enough to swamp labour markets
  • The barriers erected by most of the older EU states have not kept workers out
  • Restrictions may lead to more "undeclared work" by migrants
  • The new workers fill gaps in labour markets, particularly in construction and catering

The report also points out that in the UK and Ireland the new workers are much less likely to be unemployed than locals.

The European trade union movement, ETUC, and the European employers' organisation, Unice, have both called on the older member states to drop their restrictions.

Bogeymen

The BBC's Oana Lungescu says that whatever the European Commission may say, the cheap Polish plumber remains a bogeyman in countries with high unemployment like France.

She adds that calls have been made in Ireland for a more managed immigration policy, after the arrival of 150,000 labour migrants from the east.

This is half as many as the UK, but because the Irish workforce is much smaller than Britain's they make up a far higher proportion - 5% - of the total.

However, a report published on Wednesday by Ireland's largest bank, AIB, said that at a time of "unprecedented inflows of non-national workers" employment among local workers had continued to rise.

The restrictions on access to labour markets applied to workers from the eight new member states in Central Europe and the Baltics, but not to Cyprus and Malta which also joined the EU on 1 May 2004.

The older EU states will get another chance in 2009 to restrict access to their labour markets for a further two years.

But by 2011, all labour barriers between Western and Eastern Europe have to come down.


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