The Council and Commission have no plans to review the decision to end intra-EU Duty-Free sales in 1999. The President-in-Office, Douglas Henderson, confirmed this to Pat "the Cope" Gallagher (Connacht/Ulster, UFE), who argued that representatives in the industry claimed that up to 140,000 jobs were at risk, should abolition proceed as planned. Mr Gallagher called on the President-in-Office to give MEPs a clear picture of the effects of abolition. He wanted to know what remedial measures might be taken to lessen the blow of the job losses.
He was given some support by Mark Watts (UK, PES), who argued that unemployment had not been such a high EU priority in the early 1990s, when the decision to abolish Duty-Free was taken. He called for the decision to be reviewed. Abolition will lead to higher airport charges. It is suggested that air fares will increase by up to 20 per cent, leading to a 4 per cent fall in passenger numbers. This would lead to fleet rationalisation, contraction of routes, and reduced investment, with further job losses in the localities affected.
Besides the loss of jobs within the retailing and transport sectors, abolition of DutyFree trade is also likely to affect certain manufacturing industries. The Cognac-producing region of France estimates that 3,000 jobs will be lost in direct, indirect and induced employment.
Similarly, sales of Scotch whisky are predicted to fall by Ecu 201 million in 1999, with the loss of 1,000 jobs, mainly in the rural and high unemployment areas of Scotland.
But given the differences in methodology in the studies, MEPs want to see an independent and objective assessment of the impact of the abolition of duty free on jobs. An EP research document "The Social and Economic Consequences of Abolishing "DutyFree" within the European Union" is available from the EP Office in Ireland (free of charge, while stocks last).