Leading article: The vital message beneath the Euro waffle

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It won't have any practical effect. It's not necessary. It's not even grammatical. So why would Prime Minister Blair sign the European Social Chapter? Well, we are all in favour of workers being treated decently, aren't we? And against ruthless capitalists in top hats undercutting each other by grinding down the workers? But when it comes to what is actually in the Social Chapter, we are alarmingly vague. Something to do with the harmonisation of milk, honey and apple pie production and the Promotion of Motherhood directive, isn't it? It might as well be.

We can reveal that The Independent has obtained a copy of the actual document. It is only two pages long, but crude attempts have been made to keep its contents secret by use of polysyllabic abstractions, cross- references and dodgy translations. This linguistic monument to the remoteness of the European Union from its peoples is, undoubtedly, one of the central issues of the coming election campaign - if only because no one can deny that it represents one of the few remaining differences between Tony Blair and John Major. One will sign it, by 1 January next year, and the other will not - ever.

So we set our team of code-crackers and economic analysts on the task of working out what it all means. The fruits of their labours take the form of the first of a series of election briefings, on page 7 today. And the conclusion is that the Social Chapter does matter - not so much for what it contains, but for what the parties' response to it says about their position on the vital questions of economic success and jobs creation.

The trouble with the document itself is that much of it is platitudinous waffle. The EU "shall support and complement the activities of the Member States in", for example, "the information and consultation of workers". That might not get past a self-respecting sub-editor, but there is otherwise little to complain of in its import. Companies tend to do better when employees feel they are part of the enterprise, and there is nothing wrong with common rules across Europe as long as they lead to more information and consultation rather than less.

The awkward bit for Mr Blair is the next clause, about supporting and complementing in the field of "working conditions". That, as the small- printy obsessives at Conservative HQ point out, could mean anything. And this "support" can come in the form of measures which could be imposed on Britain against the wishes of its government. Hence the Labour leader's slipperiness on the issue.

The paradox is that Mr Blair has been saved because Mr Major has won the argument. The reason we have nothing to fear from the Social Chapter is that Germany and France now agree that well-intentioned but excessive social protection for workers acts as a drag on their economies.

Last week's most chilling news was that German unemployment had hit a level last seen in the Thirties. There are many reasons for Germany's present economic troubles, and high social costs are not actually among them, but the sharp rise in unemployment has focused attention again on the problem of how to compete in world markets without shutting millions of people out of work. The shifting of German opinion leaves Sweden and Denmark as the only EU countries advocating a full-scale, cradle-to-grave welfare state in which employers as well as governments act as providers of social security.

In the rest of Europe, "flexibility" is the buzzword. The debate is about the degree to which companies should be freed from regulations and costs, how job-creating entrepreneurs can be stimulated and how to get people "off welfare into work". It is a debate which the Conservatives have led, even if their performance has been disappointing and some of their economic liberalism goes too far.

Much more important than anything in the Social Chapter, for instance, are laws for a maximum working week and a minimum wage. Both of these should be supported in principle, not just for this country but, as the single market becomes more integrated, eventually across Europe as a whole. So far, the single European market seems largely confined to toy retailing, where all packaging is nowadays splattered with a Babel of languages. As economies become more integrated, and workers become more used to moving around the EU, level playing fields become more necessary.

Workers should not be forced to work more than 48 hours a week, as laid down in EU law, which the Government has been forced, kicking and screaming, to accept. Nor should employers pay wages that are too low, knowing that taxpayers will subsidise them through family credit. This principle of fair competition used to be accepted by Tories, and should be again. It needs to be extended so that jobs are not threatened by similar neighbouring economies that do allow workers to be exploited. But it must not extend to protectionist measures designed to insulate European living standards from global competitive pressures.

It is important that we get the answers to these questions right, not just for the politics of the UK, but for Europe as a whole. Whoever forms the next British government needs to play a constructive part in steering the emerging single European economy between the two extremes of the market liberal daydream of the "Hong Kong of Europe", and the spectre of European protectionism.

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