Importance of the network industries
Article 16 of the EC Treaty requires the European Community and the Member States to safeguard services of general economic interest (SGEI) while respecting the principle of undistorted competition in the internal market. The network industries, which provide most of the services of general economic interest, account for around 7.5% of the EU-15's total value added. In the new Member States, this share is much higher, ranging from 9.8% in Hungary to 14.3% in the Slovak Republic . In 2005, slightly more than 10.5 million people were employed in EU-25 network industries, corresponding to about 5.4% of the total workforce. However, output and employment figures understate the importance of the network industries, since the whole of society depends on the inputs and services provided by them.
Overview of the performance
This report constitutes the third horizontal evaluation exercise produced in accordance with the methodology adopted by the Commission in its June 2002 Communication (COM(2002) 331). The sectors covered are telecommunications, electricity, gas, transport and postal services. The report attempts to give a general overview of the performance of the industries in question, focusing in particular on the compatibility of market outcomes with the economic and social objectives of the European Union. The report seeks to address the sectors covered and all the Member States in a comparable, comprehensive and balanced way. Given the diverse scope and quality of the background material, however, this cannot be guaranteed.
As envisaged in the June 2002 Communication, the methodology and its application in the horizontal evaluation reports are currently being assessed. The main objectives of this assessment are to evaluate the need for horizontal evaluations at the EU level, to provide analysis on how this process could be improved and to determine whether the Commission services are best placed to carry out these evaluations.
Structure of the report
The second section presents policy and legislative developments since the publication of the last report. Section Three examines the extent to which the market opening of the different sectors has influenced the evolution of their structures and characteristics and how selected performance indicators have evolved. Section Four analyses the degree of market integration in EU network industries and presents an illustrative set of remaining barriers to integration. The fifth section analyses the distributional effects of market opening in network industries on different groups of households and regions. Section Six examines how public service obligations and quality have evolved in the industries covered. The results of consumer satisfaction surveys are presented in section Seven.
It should, however, be noted that developments in the structure and the performance of the sectors covered by this report have been influenced by many factors unrelated — or only indirectly related — to market opening. This should always be borne in mind when interpreting the indicators.