The Transatlantic Trade and Investment Partnership opens door to privatisation of public services
The Transatlantic Trade and Investment Partnership (TTIP) is a comprehensive trade agreement currently being negotiated between the European Union and the United States. The TTIP negotiations were initiated in July 2013 and 11 rounds of negotiation have taken place since. Originally, the TTIP negotiators stated that they aimed to conclude the talks by the end of 2014, but the negotiations rapidly provoked strong public attention and widespread criticisms of how such an unprecedented broad agreement would affect everything from the food we eat to how the democratic decision-making process functions. TTIP is supposedly about trade, but what the negotiators intend to cover go way beyond traditional trade treaties that focused on tariffs and quotas. As a consequence, the negotiations have drawn out and a so-called fresh start was announced by the negotiating parties in December 2014, however until now the results seem rather limited.
TTIP – the risks posed to quality education and other public services
The potential serious risks posed to public services by legally binding trade rules in TTIP is a particular strong concern of Education International and other trade unions, who demand an explicit carve-out of public services in the core text of the agreement. Otherwise, TTIP could open the door to privatisation and marketisation of public services through rules which would result in restricting the policy space available to organise public services as well as locking in privatisations where this has already happened.
In particular, market access rules could seriously restrict governments in limiting the entry and regulate the quality of foreign private and for-profit providers. Under trade rules any measure to promote high quality standards in licensing and accreditation processes could potentially be interpreted as a “disguised barrier to trade” or “more burdensome than necessary”. This implies that a government would have to prove that its regulations are necessary to achieve a specific public policy goal and that no less trade restrictive options were available to achieve that public policy goal. The threshold for what is considered necessary may be set at a very high level in a trade agreement aimed at increasing levels of liberalisation. Moreover, the idea of assessing the necessity of regulations is contradictory to the characteristics of how regulations are established within the democratic decision-making process. Regulations in democratic societies are established not in accordance to be neither the most burdensome nor the least burdensome legislation, but are the result of the reached compromise.
Furthermore, the EU’s proposed regulatory cooperation is worrying as it intends to set transatlantic requirements and related procedures for the supply or use of a service at central and non-central level (i.e. regional- or municipality level). In the case of the education sector, such transatlantic arrangements could seriously affect the provision of high quality public education through its application to accreditation, performance and quality requirement and standards.
The European Commission has repeatedly claimed that public services are protected in TTIP. In March this year the EU Trade Commissioner Malmström and the US Trade Representative Froman issued a joint statement on public services, in which they confirmed that TTIP would not prevent governments from providing or supporting public services and that TTIP would not require the privatisation of public services. However, so far there have been no statements promising the definite exclusion of public services from the scope of TTIP. The European Parliament’s TTIP recommendations adopted in July 2015 called for the exclusion of all current and future public services from TTIP. During the 10th round of TTIP negotiations, which took place on 13-17 July, the EU and the US exchanged their revised offers on services and repeated the previous reassurances that public services are protected. However, in the EU’s revised offer on services that was made public on 31 July 2015, there is not a single reference to any exception for public services or what in EU jargon is called Services of General Interest from the scope of the agreement, only to governmental authority which is inadequate to protect public services like education. In contrast, the framework agreement repeatedly mentions that measures should “not be more burdensome than necessary”.
Despite the fact that the European Commission and the US Trade Representative have not changed their approach to public services in TTIP, the mobilisation of trade unions and civil society organisations has proven to make a real difference and public services have become one of the key contentious issues of the deal that cannot be ignored anymore. Recently, an EU trade negotiator said that nothing is being done on public services that have not been done in the past. This might be true, but what is missing is that TTIP is not GATS; instead it is much more far-reaching agreement, in which public services are potentially affected in a number of different and interlinking ways. Therefore, the explicit carve-out of public services in the core text of the agreement is urgently needed.