AA13CR30

AS (2013) CR 30

2013 ORDINARY SESSION

________________________

(Fourth part)

REPORT

Thirtieth sitting

Tuesday 1 October 2013 at 10 a.m.

In this report:

1.       Speeches in English are reported in full.

2.       Speeches in other languages are reported using the interpretation and are marked with an asterisk.

3.       Speeches in German and Italian are reproduced in full in a separate document.

4.       Corrections should be handed in at Room 1059A not later than 24 hours after the report has been circulated.

The contents page for this sitting is given at the end of the report.

(Mr Mignon, President of the Assembly, took the Chair at 10.10 a.m.)

THE PRESIDENT* – The sitting is open.

1. Election of a judge to the European Court of Human Rights

THE PRESIDENT* – Ladies and gentlemen, please take your seats. I hope you all had an enjoyable evening in Strasbourg. I now call this meeting to order.

This morning the agenda calls for the election of a judge to the European Court of Human Rights in respect of Romania. The list of candidates and biographical notices can be found in document 13305. The voting will take place in the area behind the President's Chair. At 1.00 p.m. I shall announce the closing of the poll, which will reopen at 3.30 p.m and close at 5.00 p.m. As usual, counting will be held in the Table Office, under the supervision of two tellers, whom we will draw by lot.

I shall now draw by lot the names of the two tellers who will supervise the counting of the votes.

The names of Mr Haupert and Ms Guzowska have been drawn. They should go to the back of the President’s chair at 5 p.m.

The result of the election will, if possible, be announced at the end of this afternoon’s session. If no result is achieved today, a second round of voting will be opened tomorrow morning. I now declare the ballot open.

2. The Activities of the Organisation for Economic Co-Operation and Development (OECD) in

2012-2013

THE PRESIDENT* – The first item of business this morning is the enlarged debate on the activities of the OECD in 2012–13. This debate will take place under special rules which enable delegations from parliaments of non-European member States of the OECD to participate, and we welcome the participation of our colleagues from Canada, Japan, and Mexico. Voting will take place with a show of hands so that they can take part.

      We aim to finish the debate at 12 p.m. in order to hear the address from the Speaker of the State Duma of the Russian Federation. I will therefore interrupt the list of speakers at 11.30 a.m. for replies and voting.

We begin with the presentation by Mr Van der Maelen, on behalf of the Committee on Political Affairs and Democracy, of its report on the activities of the OECD in 2012–13 (Document 13301). The debate will continue with a presentation of an opinion from Mr Ghiletchi, the rapporteur for the Committee on Social Affairs, Health and Sustainable Development. Then we will be lucky enough to hear from the Secretary-General of the OECD, Mr Angel Gurría, after which we will start a general discussion. The list of speakers will be interrupted at 11.30 a.m. to enable the Secretary-General to take the floor, if he wishes to do so. That will also enable the Committees to reply and the votes to be held at 11.45 a.m.

Mr Rapporteur, you have 13 minutes in total, which you may divide between presentation of the report and reply to the debate.

Before giving the floor to Mr Van der Maelen, I would like to offer a warm welcome to Mr Angel Gurría, who had a few difficulties getting to Strasbourg because of a late train. I was pleased to have our bilateral meeting just now in my office. Everything that you said was very impressive, and I have no doubt that what you have to say will impress members of the Assembly, too. As you know, you are always welcome here.

Mr VAN DER MAELEN (Belgium) – Dear Mr President, Mr Secretary-General and colleagues, in line with the Assembly’s objectives, I have tried to make the report more political. It therefore focuses on the challenges posed by citizens’ distrust of democratic institutions resulting from the governance of the economic crisis and by evidence of fiscal injustice and unfairness. In the 1960s, US President Kennedy could state with confidence that “a rising tide lifts all boats”. He meant that economic growth was raising the standards of living for everyone - for farmers, industrial workers and business executives alike.

Now, we live in an age where such optimism in most OECD countries is largely absent. Growth has been lacklustre at best for almost five years now. Some OECD countries have yet to reach their pre-recession GDP level. Unemployment has reached alarming levels, especially among the young. In my preparation for this report, Mr Secretary-General, I had the impression that the OECD was slow to grasp the seriousness of the economic crisis. Nobel prize-winning economist Paul Krugman has stated that the OECD has been at times too quick to resort to “business as usual” thinking. To paraphrase President Kennedy today, I could say that a rising tide lifts some boats, but others run aground. Technical change, globalisation of trade and finance and the decline of the labour movement in some countries has created a world where some benefit more than others. The growing inequalities and persistent unemployment among minorities show that for truly inclusive growth, markets on their own are not enough. Policy and politics are just as important as markets. A wealth of theory and evidence shows that better policies and active government are needed to ensure that all benefit from progress.

When I look at the activities of the OECD, I am very hopeful. In May 2012, it launched an initiative called NAEC – new approaches to economic challenges - with a double objective: to draw lessons from the crisis and to promote a broader notion of growth that also considers well-being, inclusiveness and environmental sustainability. Is that not one of the main topics we are discussing in our national Parliaments – how to get out of the crisis and tackle the social problems? So, Mr Secretary-General, we are looking forward to hearing more from the OECD and, if possible, to hearing something from you about this very interesting and important initiative.

The second topic of the report is fiscal fairness. Specialists have been stating for years that the international tax system, designed to avoid the double taxation of multinationals, has instead unfortunately allowed transnational companies to enjoy widespread double non-taxation. Offshore leaks shocked world opinion this year, and last year we discovered the rampant use of tax havens by large companies. The G20 has called on the OECD to produce an action plan. On 19 July, that action plan was approved by the G20. I think I can say that this enlarged Assembly welcomes the OECD action plan, although personally I have mixed feelings about it. It certainly has a positive side. Some of its recommendations would indeed mean ending the tax breaks that, along with others, I have been criticising for years. It also contains proposals to introduce measures that we have supported for years.

Despite these positive recommendations, however, the OECD action plan is unfortunately built on a flawed approach. Mr Secretary-General, on the back of widespread citizen protest and pressures from cash-strapped governments to tackle corporate tax avoidance, the OECD could have opted for a new and better system. The fundamental flaw in the existing system is that it tries to tax transnational corporations as if they were loose collections of separate entities operating independently in each country. You, Mr Secretary-General, I and our other specialists know that that is not reality. The OECD knows as well as anyone that these firms are not separate entities, but rather unified firms under a central direction. A tax system fit for the 21st century should recognise that economic reality and seek to tax transnational corporations through a unitary approach. Most independent tax experts, including some at the OECD, recognise the clear merits of the unitary approach. I notice that, not later than last June, the International Monetary Fund recognised that a unitary approach deserves “a more thorough and realistic assessment”.

As rapporteur, I am of the opinion that the gradual transition towards such a system is both possible and necessary. A first, immediate step towards a unitary approach would be to require transnational companies to submit to each relevant tax authority a combined and country-by-country report. That would outline the genuine economic substance of what transnational corporations do and where they do it, which would build on and enhance the already fast-emerging standard of country-by-country reporting.

      Mr Secretary-General, the OECD’s approach is fraught with political obstacles, and I will cite the most important to me. First and unfortunately, OECD recommendations are not binding. Secondly, tax conflicts between nations are not addressed. Thirdly, lobbyists will fight hard against changes. Fourthly – it may be one of the most important points of criticism from my side – there is no immediate solution for Internet-based services. Google, Apple, Facebook, Amazon and others in the digital economy will be happy to hear this. Fifthly and lastly, transfer pricing will not solve the problem of double non-taxation. As rapporteur, I feel it is my duty to share with you my fear that this action plan does not go far enough. I fear that, a couple of years from now, when we evaluate the action plan, we will come to the conclusion that fair taxation of transnational corporations is still a dream.

Mr President, I will now conclude my intervention with two questions for our guest Mr Gurría. Mr Secretary-General, can you give this Assembly the assurance that, if implemented, the new action plan will end the “too big to pay tax” status of the transnational corporations? Or will they still go on playing the game called “Tax me if you can”? We all know who is the winner and who is the loser in that game. The winners are the transnational companies; the losers are the tax authorities of our countries. Thank you very much.

THE PRESIDENT* – Thank you, Mr Van der Maelen. You have two minutes and 55 seconds left. I call Mr Ghiletchi on behalf of the Committee on Social Affairs, Health and Sustainable Development.

Mr GHILETCHI (Republic of Moldova) – Dear OECD Secretary-General, dear colleagues, the Committee on Social Affairs, Health and Sustainable Development supports the report prepared by Mr Van der Maelen. It notes the continuity of his work in analysing economic and taxation challenges, building on his earlier report, “Promoting an appropriate policy on tax havens”, and the new initiatives developed by the OECD.

This year’s report on OECD activities centres on the initiative called “New approaches to economic challenges” – NAEC – and problems relating to taxation. The rapporteur puts the two strands together in analysing governmental and institutional failures to redress the economic and employment situation, as well as eroding public finances and services.

Periods of crises tend to test the strength of political and economic systems, while creating a good environment for governments to push ahead with numerous reforms. It is in the best interests of all stakeholders that the added benefits of reforms outweigh the losses that businesses may suffer as a result. Therefore, good resolutions – protecting people as well as promoting the growth of businesses – now need proper follow-up and strong political support, some of which should come from parliamentarians, including of this Assembly.

Past decisions, especially at the European level, have often proved too little and too late. At the same time, the deep scarring effects of dogmatic austerity are now becoming visible, not only on young people but across all society. Another message we can learn from this analysis is that “one size fits all” policies rarely work in real life. Even conventional economic wisdom might apply very differently to specific national circumstances; what is feasible in Estonia may not work in Poland and be totally unrealistic for Moldova. The responsibility of national politicians is hence to discern how best to adapt the international community’s advice domestically and win the local population’s minds, if not hearts. The responsibility of international organisations such as the OECD, the IMF and the World Bank lies in crafting more carefully nuanced policy advice.

The rapporteur then puts his finger on the complex and sore issue of optimising taxation. In theory the cause of fair taxation transcends political differences, but in practice it does not. Our States continue to grapple with tax evasion, as well as aggressive tax avoidance practices, despite some modest progress in stepping up pressure on tax havens. I appreciate Mr Van der Maelen’s perseverance in advocating bolder measures in this area at the international level and in particular via the OECD. The OECD should therefore use its new project of Base Erosion and Profit Shifting (BEPS) to strengthen the definition of a tax haven, as has already been stressed by the rapporteur. I also believe that the OECD could address the risks posed by shadow banking and propose measures for better oversight and regulation, as recommended by the G20 Summit.

As we approach the 2015 deadline for meeting the Millennium Development Goals, it is important to note that, although it seems that inequalities between business and the population at large have expanded lately, development aid and structural reforms have also helped to lift millions of people out of poverty. Considering that this has been the most effective poverty reduction campaign in the history of humanity, it is crucial that we continue our intense efforts in that direction to give as many people as possible the chance for a better future.

In conclusion, the Committee on Social Affairs, Health and Sustainable Development accordingly proposes a few amendments to the draft resolution with a view to strengthening the Assembly’s political message to the OECD. Thank you.

THE PRESIDENT* – Thank you, Mr Ghiletchi. We come now to the address by Mr Angel Gurría, Secretary-General of the Organisation for Economic Co-operation and Development.

I welcome Mr Gurría to the Assembly. We are very happy to have you here in this Chamber. We are also happy to welcome the parliamentary delegations from Canada, Japan and Mexico, who participate in this annual debate with the same rights as all the other members of our Parliamentary Assembly. As you know, last year we innovated by giving a more political overview on the activities of the OECD. It was a successful experiment. This year, once again, our Political Affairs and Development Committee examined the activities of your organisation, and its chairman, Mr von Sydow, is here. I always appreciate this exercise, and the contributions to our debate from delegations from non-European members of the OECD will once again enrich our discussions, as they do every year. We will listen to their contributions very attentively.

As has been mentioned, after several years of economic crisis we are witnessing a recovery that, although halting, is encouraging. I appreciate the humour with which you described a certain situation this morning, Mr Secretary-General. To achieve that recovery, citizens have had to accept heavy sacrifices. Trust in democracy has been undermined, so it is essential that any future recovery be accompanied by measures that restore growth and also restore our citizens’ trust in our institutions.

The OECD has set the tone by proclaiming the watchwords to be the search for better governance and more inclusive growth. All our governments face the same challenges, and the informed opinions of your organisation, Mr Secretary General, are very useful. We are impatient to hear your presentation, and you will, of course, also take part in the general discussion and reply to any questions. Once again, it is a pleasure for me to give you the floor.

Mr GURRÍA (Secretary General of the OECD) - Thank you, Mr President. I also thank Mr Van der Maelen for his excellent report on the activities of the OECD.

I want to say a few words about the points the rapporteur highlighted. It is nearly six years since the crisis began and we are still in crisis. Where do we stand? The economic outlook is a little brighter. In our September interim economic assessment we announced a moderate recovery in the major advanced economies of North America, Japan and the UK. The euro area as a whole is out of recession, although output remains weak in a number of countries. Today, however, we wake up to the idea that the United States does not have funding for its government and that we may or may not have a government in Italy, and there is also the formation of a government in Germany, so the political superstructure is affecting this recovery picture.

The social wounds of the crisis are far from being healed, however. Unemployment remains our biggest challenge. The uneven and weak recovery is not helping employment. In OECD countries. the average jobless rate has been around 8%, but that still translates as 48 million unemployed, and what does that mean? It means 15 million more than before the crisis, and this number has not been changing. Young people and the low-skilled have been hit the hardest. Youth unemployment has hit dramatically high levels in many countries with rates exceeding 60% in Greece, 55% in Spain, and 40% in Italy and Portugal. That is an additional looming challenge is the rise in inequalities.

So we have low growth, high unemployment - especially among the young - and rising inequalities. Today in OECD countries the average income of the richest 10% of the population is approximately nine times higher than that of the poorest 10%. Is this good or bad, small or big? The problem is that it was seven times higher 25 years ago. So inequality has grown by about 30% in one generation.

Even in traditionally egalitarian economies like Germany, Denmark and Sweden the income gap between rich and poor is expanding, from five to one in the 1980s to six or seven to one today. In Chile and Mexico, my own country, the rate is 27 to one, in Brazil it is 50 to one, and in South Africa it is maybe triple digits.

The factors of inequality stretch beyond income. Health and education are additional dimensions. We know that less educated and lower-income individuals live shorter lives, are less politically active and have children with lower school performance, so this tends to perpetuate itself. We do not have the infrastructure and we have not been successful enough to break these trends.

To tackle these challenges, we need to work on several fronts simultaneously. We must focus on growth-enhancing policies that place jobs and inclusive growth under the microscope. We have just had our ministerial council meeting. It was called “It’s all about people: jobs, equality and trust”. It was led by Norway and that is what it was about.

One of the most visible and productive results of the dialogue between the Council of Europe and the OECD is our “new approaches to economic challenges “– the NAEC – which has been mentioned. That is an idea that came out of this dialogue. It basically says, “Learn from the crisis.” What lessons are there? What could we have done better? How could the international organisations have organised themselves better? How can we prevent this from happening again and, going forward, how do we organise so that we can have – as was mentioned here - inclusive growth, greener growth, more sustainable growth, more balanced growth, stronger growth?

That is what we are doing now. We are taking this inspiration that you here gave us to say not only, “Go and look at what went wrong” - because we have a pretty clear idea of what went wrong, and a lot of books have been written about it – but also, “What could we at the OECD have done better?” We have also asked how we could have co-ordinated better with other organisations and said, “Hey. The train is coming.” On this occasion, when we said “The train is coming”, the train had already run us over and we had the biggest crisis in our lifetimes.

Through this NAEC initiative we aim to promote not only an OECD-wide reflection on our analytical frameworks and policy advice, but also a more inclusive and resilient model of economic growth. It was in this Session in 2011, during our 50th anniversary, that you here asked us to take a hard look at these issues – at the origins of the crisis, the lessons to be learned and how to avoid the same thing happening again. NAEC is more than just a project. It is a road map. It is a state of mind. NAEC will always be with us. We will always be looking for new approaches to economic challenges. It will help governments and policy makers understand better the linkages between policies and identify the trade-offs that exist between policy drivers and the outcomes in terms of well-being.

There are many other issues, but the question of taxes was mentioned in particular, so let me address that in the last few moments. Efforts to achieve a fair and equitable economy will also require sound public finances. Therefore, governments must co-operate to put an end to tax evasion and aggressive tax avoidance by multinational companies. National tax authorities have not kept pace with the globalisation of business and the rise of the digital economy. As a result we have witnessed in recent years that multinational corporations increasingly exploit gaps to artificially reduce paying their fair share of taxes. These practices undermine the integrity of tax systems across the world and profoundly distort economic competition.

On 23 July we presented to the G20 Finance Ministers a plan of action. It is called “Action Plan on Base Erosion and Profit Shifting (BEPS).” It was first presented in February, then it was approved by the Finance Ministers, and then it was presented to the G20. It was also presented to the G8 in Lough Erne in Northern Ireland, and it was then suggested that it be taken up by the G20. All the leaders in St Petersburg – with no exceptions – gave it great support. We expect to deliver concrete results on the action plan in the coming 18 to 24 months.

In the same spirit, we are also developing a standardised, secure and cost-effective model for the bilateral automatic exchange of information that will serve in a multinational context. Again, this is the work of the Council of Europe and the OECD. We signed an agreement – a multilateral convention – to give support on tax matters. Some 60 countries have already signed it and we expect another 60 countries will be signing in the next few months, so that we can migrate from exchange of tax information on request to the automatic exchange of tax information. Therefore, if someone opens an account in another country, the bank will report to the authorities, and the authorities will tell the person’s home country. If that person declared it, no problem. If they did not declare it, they will be invited to come and have a cup of tea, as it were.

This is a dramatic upskilling, upscaling and upgrading of the current situation, and it was born here. The instrument we are using to move to this automatic exchange of information comes from the Council of Europe. These two fundamental issues have changed the way the OECD is working, in our impact and our relevance, and this debate was the source of that inspiration.

      This is also about people’s trust. As Mr Van der Maelen rightly notes in the report, the global financial and economic crisis has had a terrible impact on people’s trust. According to the Gallup world poll, the average confidence in national government in OECD countries stood at 40% in 2012, which means there is a deep trend that threatens the social contract. People do not believe in their governments or in the institutions that we have built over the past 100 years. We see both the NAEC and our BEPS initiatives as key to regaining that lost trust. To complement them, we will also develop a fully fledged strategy precisely targeting the trust deficit and placing the issue once again at the centre of policy making. By the way, a description of the automatic exchange of information is also available.

      The crisis has imposed an enormous social cost. In many countries whole generations have been scarred for life. The pain has eroded the people’s confidence in their governments’ capacities. That, in turn, is raising questions about legitimacy. This is not just one more crisis. The foundations of our social contract need to be repaired, and it must be done soon. Let us review and, if we agree, revise. The Council of Europe and the OECD work together, with our concepts, theories, procedures and policy recommendations. There is much that our two houses can do together, with our technical competence, skills and expertise and your political guidance and support. Thank you for this opportunity and for the privilege of joining the debate again. I look forward to the exchanges we will have a little later.

      THE PRESIDENT* – Thank you, Secretary-General, for that lively and interesting statement. You take the floor in a lively way. I was watching the body language of many colleagues and can certainly assure you that they were listening with great interest. We will now move on to the debate. I call Mr Kennedy to speak on behalf of the Alliance of Liberals and Democrats for Europe.

      Mr KENNEDY (United Kingdom) – It is a great privilege to follow the Secretary-General’s excellent presentation, which we very much appreciated. He and his colleagues are welcome among us today. I also welcome, on behalf of the Alliance of Liberals and Democrats for Europe, the excellent report introduced by the rapporteur, Mr Van der Maelen, on the activities of the OECD.

I am speaking today on behalf of ALDE and certainly not on behalf of the British Government, although my own party is a coalition partner within that government. The British Government has indicated, through its Foreign and Commonwealth Office, its broad support for the report, with one exception. That exception is very pertinent to the ongoing and endless debate within liberalism in a European context, and indeed a global context. It is a debate that will never die, and indeed it should never die, because it goes to the very DNA of liberalism itself. It is about the correct balance between social liberalism, in which I place myself, and economic liberalism, which others are more inclined towards. I suppose it was best encapsulated many years ago in Bad Godesberg, when the then West German FDP switched its allegiance in coalition from the Social Democrats to the Christian Democrats. That debate permeates liberalism across Europe, and it is certainly alive within the liberal wing of the United Kingdom’s coalition Government.

That debate goes to the heart of the British Government’s one element of opposition to the report. Paragraph 10 states that we should support the argument made by the Trade Union Advisory Committee to the OECD that “financing fiscal consolidation through cuts in public services, in social security and pensions would only prolong the jobs crisis and risk a social crisis”. I understand, of course, where the British Government is coming from in that respect. The trade union view will meet with a great deal of sympathy and endorsement. Indeed, I myself am very sympathetic towards it. However, if our liberal approach to these matters teaches us anything, it is that a political philosophy must be driven by a heart and also by a head. The symbol of the Liberal Democrats in Britain is a bird of liberty, and a bird requires two wings to fly. I do not agree with the British Government’s outright opposition to the paragraph, but none the less I advise caution. A social conscience, yes, but we also need fiscal responsibility and level-headedness.

THE PRESIDENT* – Thank you, Mr Kennedy. I call Mr Binley to speak on behalf of the European Democrat Group.

Mr BINLEY (United Kingdom) – I congratulate Mr Van der Maelen on his hard work in producing this comprehensive report. I will express concern about the welcome we give to some of the OECD’s activities. It often advocates more central control and argues for a one-size-fits-all mentality. I will therefore make two points to illustrate those two cases. Paragraph 7 of the draft resolution “welcomes the OECD’s efforts to mainstream its Green Growth Strategy into core policy areas”. In Britain, we have a target to achieve 25% of the EU’s renewables, which means windmills producing energy at £144 per megawatt-hour, while gas and other carbon-based products produce energy at £44 per megawatt-hour. There is no sense in that, especially when other nations outside Europe are paying no heed to the need to conserve resources.

My second point has already been made by my colleague from the British Parliament, and indeed from the British Government, Mr Kennedy. Paragraph 10 supports TUAC’s ill-judged contention that “financing fiscal consolidation through cuts in public services, in social security and pensions would only prolong the jobs crisis and risk a social crisis.” Well, from Britain’s point of view, you can take it from me that Maggie Thatcher would have said that that was nonsense, and many people would have supported her. My grandmother would have supported her. She said there were only two things you could do in a financial crisis: the first was to cut your spending and the second was to earn more money. It was simplistic, but it lies at the very heart of economic probity. We will do ourselves an injustice if we lose sight of that. Governments caused the crisis and governments need to do something to solve it. In 2002 in my country we created a budget deficit that grew to the point where we were borrowing £1 in every £4 we spent. My grandmother would have been horrified.

In conclusion, although I welcome many of the report’s contentions, I think that a one-size-fits-all-nations approach is a crazy way to think about dealing with this problem, and I support the contention of the rapporteur for the Committee on Social Affairs, Health and Sustainable Development.

      THE PRESIDENT* – Thank you, Mr Binley. I now call Mr Hunko on behalf of the Group of the Unified European Left.

      Mr HUNKO (Germany)* – I would like to begin by thanking the rapporteur for this very good report, and for the points he picked out in his speech. This has been a good job of work – thank you, Mr Van der Maelen. I also thank the Secretary-General of the OECD for his speech and for his critical points on the economic crisis and the recession. For example, at the end of June the OECD criticised my country for its policy on low salaries. Addressing this issue is an important element in avoiding tensions in the eurozone area – an important point, so thank you very much for making it.

Mr Binley alluded to paragraph 10 of the resolution. I have to say that I take a different view – I welcome it. The OECD Trade Union Advisory Committee stated that “financing fiscal consolidation through cuts in public services, in social security and pensions would only prolong the jobs crisis and risk a social crisis”. This relates to a debate we had in June on a critical report, which was approved, on economic policy, in which we said that budget consolidation should not simply be characterised by cuts in the social sector, but by further income too. This is a positive aspect of the new initiative – the NAEC, to which Mr Van der Maelen referred – and, in particular, the BEPS initiative. Income must be generated – we have to produce more income. The tax avoidance policies of multinational companies must be tackled. I hope that the action plan will go far enough and that we are able to come back and discuss this next year, and perhaps the year after that.

In conclusion, the name of the OECD contains the words “co-operation” and “development”. This is a time for co-operation and not the blind competition engaged in by multinational companies. I remind the Chamber that the OECD was preceded by the Marshall plan, which was developed after the Second World War. Perhaps we should bear that in mind when considering countries in the south of Europe, such as Greece.

THE PRESIDENT* – Thank you, Mr Hunko. Before I give the floor to Mr Sasi on behalf of the Group of the European People’s Party, may I remind colleagues that the voting for the election of a judge on behalf of Romania for the European Court of Human Rights has started? Mr Sasi, you have the floor.

Mr SASI (Finland) – I thank the OECD for its valuable work on the world economy and on growth, and I thank Mr Van der Maelen for a very interesting report.

I think it is true that there is a distrust of political institutions in Europe at the moment. Tax evasion is an indication of the width of that distrust. The extent to which tax evasion is acceptable and widespread shows that distrust. If taxpayers do not feel that their money is being wisely spent they will not want to pay taxes, and that has become acceptable. When I see, in some countries, politicians employing their relatives or party friends, I can understand why people are angry and do not want to pay.

Let me take the Nordic countries as an example of countries where tax morale is high. In these countries, money is wisely spent on health services and education, and people feel that they want to pay taxes because they get something good in return. As politicians, we have to be honest with taxpayers and use their money effectively and wisely.

Unemployment is a political choice. There is always demand for labour; the question relates to the price for that labour. For example, if, as some parties have demanded, we have a minimum wage, that means we forbid work at a price that is lower than the statutory minimum wage. That means we choose to have unemployment. I think that all work is valuable, so although the price is low people should be able to work. Some might say that that is unfair, but then society comes into the picture and we guarantee housing, food and basic social security if the wage is not enough to live on. What do we have to do in Europe? We have to deregulate and increase the flexibility of the labour market to guarantee that there is work for people to do.

On wage agreements, we now live in an open economy, so it is not possible to have high rises in wages – they must be open to competition. We can take Germany and Greece as an example. Over 10 years, salaries in Greece rose by 40% in comparison with German salaries. Greece chose unemployment; Germany chose full employment. That is a political choice made by labour organisations.

On sovereign debt crises, Mr Kennedy said that cuts would prolong the crisis. The problem in this crisis has been that in the European Union we always do too little too late. I think that a crash strategy is the best strategy. The examples of Latvia and Iceland show that making immediate deep cuts creates a healthy and sound basis on which to build an economy. Cuts should therefore be made as soon as possible, so that the economy can bear the social cost in the future.

      THE PRESIDENT* – Thank you. I call Mr Mogens Jensen on behalf of the Socialist Group.

      Mr Mogens JENSEN (Denmark) – Mr President and dear colleagues, on behalf of the Socialist Group I congratulate our colleague, Mr Van der Maelen, on working so hard to produce a report on OECD activities that is based on clear political analysis and choices. This can be a challenge when dealing with an economist-driven organisation and lots of technical terms and expert economic expressions, and the report is very clear and focused.

      In 2012 and 2013, the OECD has had to form and implement policies in the light of the economic crisis. At last, we are now seeing signs of a recovery in the world economy, most notably in the United States and Japan. Unfortunately, growth remains weak in our part of the world and in a lot of OECD countries, and unemployment remains all too high. Governments still need to use all their force to restore growth and competitiveness, reduce unemployment – in particular among young people – and fight against long-term unemployment. They have to rebuild confidence, address inequalities and boost job quality.

      That is a severe challenge while, at the same time, we face deepening globalisation, poverty, rapid population ageing, migration, climate change and a growing rarity of natural resources. Successfully addressing the employment crisis is perhaps the biggest challenge facing governments and the world. We know that one important tool in this fight is the clear political focus on improving knowledge and skills in each and every country. Public investment in education and lifelong learning is crucial, as well as public investment in research and infrastructure that can improve productivity. As Mr Van der Maelen’s report says, it is necessary for many OECD member States to control public spending and deal with the sovereign debt crisis. However, if we do not invest in the future production and generation, this will be a lose-lose strategy.

We have to walk on two legs: to control public spending and choose the necessary priorities as well as to save resources for future investments.

      The other important focus in Mr Van der Maelen’s report is the leading role of the OECD in the international drive to ensure tax fairness by cracking down on aggressive tax evasion. The Socialist Group of course supports all means to fight tax havens and secure fair taxation throughout the world.

      (Mr Boden, Vice-President of the Assembly, took the Chair in place of Mr Mignon.)

      THE PRESIDENT* – Thank you, Mr Jensen. The next speaker is Mr Schwaller.

      Mr SCHWALLER (Switzerland)* – Mr President, colleagues, I thank the rapporteur for his report and for giving us a bird’s eye view of the recession over the past few years. It is clear that we must look at implementing the recommendations and resolutions, and much is still to be done.

      Paragraph 10 of the draft resolution states that financing budget consolidation by cutting back social services, social security and pensions will simply extend the crisis and lead to the danger of a social crisis. If that means that those three sectors have to be excluded from the consolidation programme, it would represent a failure. On public services, we must ask what tasks will in future fall to the State. On social security and pensions, if a State allows its people to retire at the age of 50 or 60, it is clear that it cannot pay for that, which will also represent a failure. The non-financing of social security is one of the most dangerous factors that might lead to a lack of confidence.

On the OECD’s efforts to improve the situation on tax evasion, I support the idea of fixing standards in relation to tax evasion and avoidance. However, it is not enough simply to write reports and to say that we must exchange information, if those standards are not actually applied across the board by all important social classes throughout the world, if the rules and recommendations are not put into practice and are not respected by well-known tax havens, and if many States still allow such practices. We must therefore ensure that the rules apply across the board.

      Finally, on the automatic exchange of information, it is essential to establish which data and what sums of money deposited in banks are included, because too much information is not very useful. For example, what is the point of exchanging information between States about the payment of a mobile telephone bill for 7.50 Swiss francs? We must have clear definitions of the rules and make sure that they are properly applied, at least by the member States of the Council of Europe.

      THE PRESIDENT* – Thank you, Mr Schwaller. The next speaker is Ms Guzenina-Richardson.

Ms GUZENINA-RICHARDSON (Finland) – Mr President, all of us in the Assembly should read Mr Van der Maelen’s report from beginning to end. It is very honest and illuminating in addressing the current problems faced by our societies. For example, a paragraph about handling the liquidity trap on page 11 includes the word “hysteresis”, which refers to the long-term consequences of short-term effects and is a term that should be more widely understood. The paragraph states that hysteresis works through “reduced capital investments, reduced investment in research and development, reduced labour force attachment on the part of the long-term unemployed, scarring effects on young people who have trouble starting their career, reduction in governments’ physical and human-capital investments” and so on.

      The OECD’s role has been that of a consultant writing prescriptions for economic growth, but Mr Van der Maelen states that the OECD has done some soul-searching, which is very good, because we need to change our approach if we truly want to solve the current problems faced by our societies. For example, the far too liberal approach to the financial sector and tax avoidance should be tackled by all governments.

Dirk Van der Maelen’s report is an eye-opener. If you are willing to accept the reality as it is and, gathered here at the Council of Europe, to agree that our job is to fight for human rights and democracy, the report deserves a big thank you because it points out the human effects of governments’ failures on, for example, tackling debt and the tax haven problem. If we are to find sustainable solutions to current problems, we must understand and acknowledge how we arrived in this situation, and the report does that very well.

      THE PRESIDENT* – Thank you, Ms Guzenina-Richardson. Dear colleagues, I remind you that voting for the election of a judge to the European Court of Human Rights on behalf of Romania has started. I call Mr Bockel.

Mr BOCKEL (France)* – Thank you, Mr President. Dear colleagues, elections throughout the continent during the past four years have almost all, apart from in Germany, resulted in voters rejecting governments that were in place and have had to face the economic and financial storm. There are several related factors, such as the refusal to extend the mandate of governments judged as too lax and as being responsible for the crisis, and weariness about austerity measures that are often judged to be far too severe and the aims and objectives of which remain poorly understood by our fellow citizens.

It is no accident that the International Monetary Fund and the European Union advocate a far better social calibration of support programmes established by States facing very serious financial difficulties. I note that the Secretary-General has flagged up that approach in the OECD’s New Approaches to Economic Challenges. Combatting over-indebtedness of States or budgetary slackness should not be automatically synonymous with social dumping or heavier taxation. We do not want the patient to be cured, but then to die.

      Insofar as the European Union is concerned, it has underlined the importance of the social consequences of the crisis by fostering new approaches – for instance, through the creation of the Youth Guarantee mechanism. The cost of dealing with youth unemployment in the European Union is huge. I am particularly thinking of young people under 25 who are not students or in training. There are more than 8 million in Europe, and many of them are in long-term unemployment. The European Commission is going to call on each member State to produce a quality solution for young people without a job, and it has earmarked € 8 billion for the Youth Guarantee.

I note that the European Union has embarked on discussions about a European unemployment benefit. It would be an insurance system in which risks and economic shocks are shouldered by all member States. It would also reduce fluctuations in national income and offer more room for manoeuvre during economic slowdowns. The regime would be a basic benefit that was topped up by member States. If such a reform had been in place, it would have reduced the drop in Greek and Spanish GDP by 20% and 10% respectively. Such a revision of our economic approaches in the European Union is in tune with the values championed by our Assembly in relation to dealing with the economic crisis and its consequences humanely and responsibly. May I say that your initiatives are very much along the same lines, Secretary-General?

      I congratulate the rapporteur on the excellent work that has been done. I regret that there have been no meetings of the ad hoc sub-committee of the Committee on Political Affairs and Democracy on monitoring the work of the OECD, but I understand that that is going to change.

      THE PRESIDENT* – Thank you, Mr Bockel. I now give the floor to Mr Díaz Tejera.

      Mr DÍAZ TEJERA (Spain)* – I have a feeling of déjà vu in this debate. We have been here before in recent years. Dear Dick, I do not know whether this is a dream or a nightmare. I have two questions about your report.

      In paragraph 79, there is an analysis of the fight against tax havens. Your splendid report underlines that transnational corporations are making fun of existing laws and of the societies that our parliaments represent. That lack of respect is eroding the legitimacy of our parliaments and our policies. This is not only a matter of economics; it is a political crisis. Mr Gurría called it a deficit of confidence.

There seems to be not only a lack of respect for, but hatred towards our Organisation and our countries – countries in which Nazism and fascism are moving against parliamentary democracy. I am not talking about fascists and Nazis per se, but about a silent process that does not want a system of parliamentary democracy. We are easy targets for those people.

We do not want to lose our acquis today, so my question is what we, as parliamentarians, are failing to do. What should we call on our governments to demand of transnational corporations so that we have the right taxes and so that corporations are not, for example, selling products to both sides in the Syrian conflict? Transnational corporations continue to sell chemicals to both sides in the conflict and those chemicals continue to be used. It seems that there are limits to our policies. We must ensure that there is greater respect for those policies and for our system, not least in our fight against tax havens. We should tell people to reduce their spending and to understand that their rights are not unlimited. We must ensure that we no longer let this situation continue when no respect is shown for us and our system.

Some members have referred to paragraph 80. I would like that paragraph to be considered with respect to compliance with the standards and the fight against tax havens.

I thank you, Dick, for this report and you, Mr Gurría, for the respect that you have shown by coming to speak to us today.

THE PRESIDENT* – Thank you, Mr Díaz Tejera. I now give the floor to Mr Hawn, Observer from Canada.

Mr HAWN (Canada) – I thank the rapporteur for his well-articulated and thoughtful analysis of some of the most difficult economic challenges that face the global community and economy, and his evaluation of the OECD’s prescriptions for dealing with those challenges.

Canada is broadly in agreement with the rapporteur’s depiction of the state of the global economy, which was drawn from the OECD’s economic outlook. Although Canada is concerned about the pace of the economic recovery, it is generally supportive of the co-ordinated responses, particularly among the G20 countries, to the global financial crisis. In particular, Canada supports the loosening of monetary policy to stabilise the financial system, the large fiscal stimulus measures to support domestic demand, and the credible and growth-friendly plans that were agreed in June 2010 to ensure that there is fiscal sustainability. Most people would agree that the global economy would be in a worse state had it not been for those measures. More than simply averting a disaster, those measures have paved the way towards stable long-term growth. Achieving a stronger recovery, however, must be balanced with fiscal sustainability. That was confirmed at the recent G20 summit in Russia.

We suggest that the OECD remain focused on its core role of analysing and recommending key structural reforms to secure a lasting global recovery. Although initiatives such as the new approaches to economic challenges that promote a broader notion of growth that includes outcomes such as inclusiveness and environmental sustainability are useful, we caution against excessive complexity and ambition. The focus should be on realistic projects that deliver concrete results. Canada believes strongly in social and economic balance. The strength of our economy and our strong social programmes are evidence of that balance.

On taxation, we support the moderate approach of the OECD that is contained in the “Action Plan on Base Erosion and Profit Shifting”. Canada welcomes the leadership that has been shown by the OECD and the G20 in bringing BEPS to the forefront and we support the OECD’s work on addressing BEPS. However, we have a number of concerns about the way in which the rapporteur has characterised the issue. He suggested that it is the weakness in transfer pricing rules that leads to instances of double non-taxation. The OECD action plan makes it clear that that is only one of the many aspects of international tax rules that may affect BEPS, and that the interaction of different tax rules leads to double non-taxation or less than single taxation.

On the call to consider the unitary taxation of transnational corporations, Canada does not consider global unitary taxation to be a viable approach. Instead, we support the international consensus on transfer pricing, which favours the arm’s length principle.

On tax havens, Canada supports the work of the Global Forum on Transparency and Exchange of Information for Tax Purposes and the Forum on Tax Administration. It urges all jurisdictions to address the Global Forum’s recommendations.

I thank the rapporteur for his excellent efforts in the preparation of his report and for his articulation of the draft resolution. Although we may not agree with all his recommendations, we are thankful to have had the opportunity to contribute to this valuable discussion.

THE PRESIDENT* – Thank you, Mr Hawn. I now give the floor to Mr Reimann.

Mr REIMANN (Switzerland)* – It is good that we have the OECD, but not everything that it has done recently has been good. It is therefore right that a legitimate Organisation such as the Council of Europe monitors closely what it does.

In principle, I welcome the report and the open discussion about it in plenary, but I have reservations. That is what lies behind our amendments. The report is too full of praise. It could be that there are good elements. However, the report was written largely by socialists. There is too much in it about the need for harmonisation and centralisation, and about how too much is left to individual States. We think that the OECD does that rather too much. We do not contest the point that an exchange of views is needed and that studies must be carried out. It is wise that that happens. In that respect, I continue to expect qualified work from the OECD. However, the organisation should not tell me how political parties should be financed in my country. We will decide that for ourselves, thank you. It will be decided on by majorities in individual countries. The organisation does not need to be involved in all matters of fiscal justice in individual countries or to say when it is appropriate to impose taxes. Those matters should be left up to individual countries. We do not need the finger to be pointed from France all the time.

We also wonder about the use of the term “tax haven” without a clear definition. We must consider the differing practices from country to country. Similarly, on the automatic exchange of information on tax matters and the call for uniform taxation rules, I wonder whether the desire to regulate all those matters makes sense.

Those are the things that we do not like about the organisation. There is a pressure to listen to it, even when it has not received approval from elsewhere. In certain cases, less would certainly be more.

      THE PRESIDENT* – Thank you, Mr Reimann. The next speaker is Mr Timchenko.

      Mr TIMCHENKO (Russian Federation)* – Mr President, ladies and gentlemen, I echo the words of gratitude to the rapporteurs for their excellent work, and I welcome the Secretary-General of the OECD and thank him for his presentation.

      Russia is not officially a member of the OECD, but our active co-operation goes back some 20 years, and our relations have become close and substantive. Today, we take part as an observer in the work of many committees and subsidiary bodies of the OECD; we have the opportunity to present our position on the issues discussed and to take part in developing recommendations. OECD economic reviews of Russia are published regularly, as well as analyses of various sectors, and that has a positive impact on our country. In particular, we value co-operation in developing anti-monopoly legislation and taxation legislation, which are useful in attracting investment, reforming the agriculture sector and so on. In addition, I join others in expressing concern about the taxation of transnational corporations.

Russia is taking steps to join the OECD. In 2012, we fulfilled two important conditions for membership of the organisation by becoming a party to the Convention on Combating Bribery of Foreign Public Officials in International Business Transactions and to a protocol on joining the World Trade Organisation.

We can share our own experience, and we hope that Russia joining the OECD will have a positive impact not only in Russia, but on the global economy as a whole. The world is truly interdependent: countries rely on each other increasingly and are interconnected. Russia is in a similar position to other countries in Europe and the world; we have the same problems of rapid ageing of our population, migration, climate change and depletion of natural resources, and it is difficult to underestimate the role that the OECD can play in dealing with such challenges.

The analysis of OECD activities in 2012-13 shows that in many areas Russia is clearly working on the same wavelength as the OECD. There are many examples of Russian governmental decisions that correspond to recommendations of the OECD Council, and we are ready to co-operate even more closely.

THE PRESIDENT* – Thank you, Mr Timchenko. I now call Mr Beneyto.

Mr BENEYTO (Spain)* – I thank Mr Van der Maelen for this report, and the OECD for all its work, but some aspects of the report should be looked at in greater detail. We have already spoken about hysteresis, which seems to affect many of the policies being adopted. The countries of southern Europe, for example, have looked at things mainly from the perspective of fiscal consolidation, with growth intended to be increasingly important. This report and the experience of the US, however, have shown that liquidity has hindered our emergence from the crisis. This shows a radical change in thinking about our economies over the past years, as a result of the crisis. Rightly, the OECD and this report show that we need other goals for macroeconomic policy – we need a more holistic and comprehensive approach.

What about our own assessment? There may come a moment when we are being excessive, when the increase in taxes generates negative effects. The OECD should play a fundamental role in, for example, showing the negative effects at a given moment of structural adjustment changes. Each country should be looked at in its own right. The situations in Portugal, Italy, Greece and Spain are not the same: we cannot put them all in the same pot. They are each making structural changes and emerging from crisis. In Spain, we are on the point of achieving economic growth, but none the less the debt problem remains. We need to deal more closely with the problem of debt. We need to think about innovative mechanisms on equity – it is the only way we have to overcome the problem of debt, and not only in southern Europe. We must not think about the problem from the perspective of Japan or the United States; we need to look more closely at where we are now.

The OECD is the major think tank, but it needs to be more proactive and better able to shed light on the problems facing our individual countries. It is not sufficient to apply existing recipes; it is a new situation, so we need new solutions and approaches. The OECD is facing a major challenge, and the Council of Europe through its parliamentary legitimacy can help in this task.

      THE PRESIDENT* – Thank you, Mr Beneyto. Mr Recordon is the next speaker.

      Mr RECORDON (Switzerland)* – Dear colleagues, I thank our rapporteur for his stimulating report – not fully comprehensive, but very stimulating. I want to flag up three aspects, the first being the relationship between points 5 and 7 of the resolution – in other words, between the growth and environmental aspects.

      Thank goodness, we are no longer governed by Mr Binley’s grandmother, and nor are we in an era dominated by too much inflation and monetary policy, as we once were. However, we have to manage not only our financial resources properly, but our environmental resources, and those of our planet, carefully. Thus, our energy resources are called into question or, if we look at biodiversity, our long-term agricultural production would be threatened were bees to die. We need to look at the growth and environmental challenges, and the internal contradiction. We can overcome it, but to do so will be difficult. I call on you at the OECD, and on the rapporteurs, to look at what can be done to manage growth properly and to remove the risks inherent in the contradiction between growth to guarantee economic prosperity and the importance of fully respecting the environment as a condition for the survival of our planet.

      My second point is about the economic aspects from a fiscal point of view, with regard to resources that are of vital importance to our society. This was set out in the report by Mr Van der Maelen, which raises a number of important issues, and I fully endorse his conclusions. I would like to draw attention to one aspect, as Mr Schwaller was pointing out – the importance of this being applied across the board. I add that it needs to be applied effectively. Lots of lofty statements are being made and much is being said, but I am not sure what is being done. We need things to be done effectively. There is a risk, however, in applying things across the board, although that seems to contradict what I said just now; we need to be careful about introducing automatic exchange with countries that do not necessarily respect human rights, because it would be possible for tax avoidance to continue.

      The third aspect is the fact that we have to regain the trust of our citizens, which was mentioned. That is of fundamental importance, because otherwise the risk to democracy is even greater.

      THE PRESIDENT* – Thank you, Mr Recordon. I now call Ms Santo.

Ms SANTO (Japan)* – My name is Aiko Santo, and it is a pleasure to speak to you. It has been 25 years since I last participated in this Assembly. In the meantime, the world’s economic situation has undergone dramatic changes. With the collapse of Japan’s bubble economy in the early 1990s, we entered an economic downturn and a period of deflation lasting some 20 years. We also suffered a significant setback two and a half years ago when a major natural disaster struck Japan. I thank the international community for all the support that it has given us.

In the midst of those difficult circumstances, we had two elections in Japan: to the lower house in December, and to the upper house in the summer. For the first time in three years, the Liberal Democratic Party regained power in Japan in both the upper and lower houses. As a result of that significant change in political climate, Prime Minister Abe’s cabinet now has three years to focus on implementing Abenomics, his set of policies, which has been viewed favourably.

The three areas of Abenomics are aggressive monetary easing, flexible fiscal policy and structural reforms to raise Japan’s growth potential. Thanks to those initiatives, the Japanese economy has shown significant recovery, achieving 4.1% real economic growth year on year between January and March this year and 3.8% between April and June. The consumer price index has also increased by 0.8%, indicating a breakthrough away from the deflationary trend that has long been a concern. Progress has also been made in achieving sound public finance, another major concern for Japan. Medium-term budget planning finalised in August calls for a 50% reduction by 2015 in both national and municipal public debt measured as a percentage of GDP and a return to fiscal solvency by 2020.

Increases in taxation are difficult in any country, but they are indispensable to achieving sound public finance. Just a few hours ago in Japan, Prime Minister Abe finalised the decision to raise the consumption tax from 5% to 8% effective 1 April 2014. We are confident that Abenomics is the key to sustainable economic growth in Japan, which in turn will contribute significantly to the global economy. I assure you that Japan’s economic outlook is very bright.

THE PRESIDENT* – Thank you. I call Mr Mendes Bota.

Mr MENDES BOTA (Portugal) – If the current economic crisis has served any purpose, it has been to let out into the open the inequalities in modern democracies and the schisms between rich and poor and powerful and helpless. The most vulnerable have been the hardest hit by austerity measures.

Mr Van der Maelen’s report raises various legitimate issues, of which I will highlight three. First, resorting to fiscal havens has become common practice, with the complicity of the biggest industrialised economies. The fear of losing investment as business relocates and a consequent rise in unemployment has made the more developed democracies hostages to a modus operandi that is callous at best and hypocritical at worst. States are forced to compensate for their deficits by overtaxing individuals and small businesses and cutting public services, health, education and social welfare. We therefore fully support the OECD’s intentions in its efforts to press countries to impose greater transparency in disclosing assets and transactions, as well as to increase inter-agency co-ordination and the fight against fiscal havens.

      Secondly, it is important to support initiatives such as the OECD’s Green Growth Strategy. Boosting investment in the clean energy market is not only a way to ensure stable and durable long-term employment in a fundamental strategic area; it is a way to redirect the billions spent on carbon fuels. The potential of that bet cannot be over-emphasised. Recent reports estimate that 30 million jobs have been created worldwide via the sector. Chapter 2 of the Van der Maelen report discusses the necessity of avoiding traditional financing and promoting new ideas, among which the “New Approaches to Economic Challenges” programme is the finest example. Thirdly, it is essential to reduce the salary gap and restore inter-class dialogue. In a world where noise often overwhelms clarity, the relevance of the role of decision-making spaces is growing.

Progress in our societies has not always been conquered in a straight and vertical tangent. As parliamentarians, our foremost duty has been to see the glass half-full rather than half-empty and to pack with opportunities this wagon of change. The engines are running; the starting shot has been given. We must only choose which legacy we would like to unload in the future station – whether, when opening the carriages, our children and grandchildren will enter a mausoleum of dusty wrecks, the spoils of a sombre past, or whether they will be greeted by the simple light of ideas and philanthropy.

THE PRESIDENT* – Thank you. I call Mr Jáuregui.

Mr JÁUREGUI (Spain)* – This is an excellent report. In particular, it is important to highlight paragraphs 16 and 17, which deal with fiscal co-ordination and harmonisation and combating tax evasion and avoidance. That is a just cause worldwide, and it is important.

Paragraph 17.2 recommends the establishment of national accountability for all major corporations to those countries in which they are active, and unitary tax obligations. I should mention two ideas that have not been sufficiently developed. First, it is necessary to incorporate into global economic governance the possibility of financial transaction taxes. Ladies and gentlemen, you know that the banking and securities markets generate approximately three times more money than the real economy. That is an extraordinary source of fiscal revenue of which we should take advantage, and the OECD should develop technical methods to make that possible. Humankind is moving more and more towards the need to introduce a tax on financial transactions, partly in order to organise those chaotic economic flows. Many experts say that unless we control and organise excessive financial flows, new bubbles will form, new dangerous financial products will be marketed and more and more people will be impoverished. Bringing more order to the system is an important and just cause.

The second important point is that the OECD should serve as an instrument to establish minimum thresholds for labour conditions worldwide. It is essential in this globalised economy, in which production can occur anywhere in the world. We cannot go back to the middle ages. It is important to adopt the same mechanisms approved at the beginning of the United Nations, so that human rights are the foundation for labour conditions around the world. The Council of Europe, as an upholder of human rights, must take part in that cause.

THE PRESIDENT* – Thank you. I call Mr Fritz.

Mr FRITZ (Germany)* – Mr Van der Maelen’s report and the comments have shown that the OECD is rightly part and parcel of social development as well as the development of world economies in the interests of mankind. It is therefore not surprising that this discussion is controversial. We are going to the heart of the matter. How could it be otherwise?

The claim of the OECD is not to announce world truths, but actually to provide a basis for decision, including international decisions, and for international discussion. Governments and parliaments have to look at what is being said, because, looking at what has been offered, we need something much more effective in terms of the world economy, and this depends on many factors. For example, the OECD has developed a great deal of competencies and that is why it is in a good position to be able to put these points to us.

The OECD is not only established from the club of the rich of the world; it has developed a network and it is involving new players in this institution. The OECD also deals with development in its network with developing countries and that is why it is an important player in the global governance field. I believe that it is the organisation that can provide a basis for the G8 and G20. Of course, that does not mean that all problems will be solved in one fell swoop, but it means that we can find some points of departure for reaching, or getting closer to, consensus between the States, so that we can have a basis for discussion to provide solutions. That is why it is important to have notions such as inclusive growth.

How can a society survive in the future, when half of a generation just does not have an opportunity to have a job or is not able to be involved in a profession? That does not just mean an invitation to the States. We have to look at the forces of society. States should use qualified people and make use of lifelong learning and this should be provided across the board.

Secretary-General, I am happy to say that you are still showing determination to broaden the fields, to bring them together and to integrate them within the organisation. Part of that, of course, is education and part is green growth, and there is also your attempt, for which I thank you very much, to enter into dialogue with parliaments. I hope that many more colleagues in future will take up this opportunity of the parliamentary forum, because this should not be restricted to one report and one debate in the Parliamentary Assembly.

THE PRESIDENT* – Thank you, Mr Fritz. I give the floor to Mr Gándara Camou, Observer from Mexico.

Mr GÁNDARA CAMOU (Mexico)* - Thank you, President. On behalf of the delegation of Mexico, I congratulate the rapporteur, Mr Van der Maelen, and our compatriot, Mr Gurría, on a clear, well-focused, excellent report. We have also heard others speak with great conviction. We are also grateful for this opportunity – even though we are observers in the Council of Europe – to take part in this discussion and, of course, in the voting on this report.

One of the most relevant activities at the moment is economic co-operation. We notice that various problems have been raised, such as unemployment and the lack of growth. Yet without doubt countries are addressing these problems, at differing speeds and with different remedies.

In the case of Mexico, tax reform is being discussed, which should make available more resources to meet the commitments of the Mexican State in terms of housing, education and health, inter alia. We are aware that it is important that all should have an income. We have looked at these problems and are aware of, for example, the need to meet those who have suffered in hurricanes and other such phenomena, and that we are in the context of reforms, such as those mentioned by the OECD, in relation to trying to find new formulas, in which we Mexicans are heavily involved, taking into account these recommendations in terms of structural changes that we are conducting in the Congress of the Union and in our Government.

The three main fields have been set out clearly in Mr Gurría’s report: inclusiveness and growth; interdependence at the service of growth; and governance at the service of growth. We think that, through this, we will generate the necessary employment – an issue that is part of globalisation. With all these activities evolving at such speed, new global challenges are evolving, such as the deterioration of the environment, tax havens, transparency in the exercise of government and tax fraud, and all these things which we have to fight.

In this vein, once again we congratulate this great Organisation for Economic Co-operation and Development, of which Mexico is a member. We believe that, through this assessment, we will all benefit and this will benefit the development of the State, at the end of the day, for our own families. Thank you very much, Mr Gurría.

THE PRESIDENT* – Thank you, Mr Gándara Camou.

We still have 15 people on our list. Unfortunately, I have to interrupt the list of speakers. I remind you that members who are on the list and present in the Chamber but who have not been able to speak may submit their speeches in typescript to the Table Office in Room 1083 for publication in the Official Report.

Would Mr Gurría like to add anything at this stage?

Mr GURRÍA - Thank you, President, and thank you, Mr Van der Maelen. You asked me to give assurances that, if BEPS is implemented, we will kill the “too big to pay tax” syndrome. That is the idea. But please understand that, when we are pursuing the tax evaders at the individual level, we are trying to enforce the law. When we are trying to tax the multinationals we have to change the law, because as you said well, we moved from avoiding double taxation to creating double non-taxation, and neither of those things was the idea. Nobody said, “Tax them double” or “Don’t tax them”. We have to tax them once. The question of where and how we divide that tax is another matter – a technical discussion which we are already having. This is the idea. We are going for it, but it requires a change of law and massive co-ordination and massive political will. This is why the G20 is possible.

Let me just give you a number. Before, on automatic exchange of information in general, we had no standards and no exchange of information on taxes, and only 40 bilateral agreements had ever been signed among countries before the G20 got into this in 2008. Now 1,200 bilateral agreements have been signed and information is being exchanged actively; this is why we can now migrate to an automatic exchange of information and why we are now tackling the BEPS. We have the basis, with the countries and the infrastructure: 60 have now signed, including all the G20 countries.

Mr Ghiletchi, we want to get better policy advice and this is precisely why we are doing the NAEC, to serve our members better. You also mentioned the Millennium Development Goals (MDGs). Yes, as you mentioned, this was the greatest success in reducing poverty that we have had in a long time, but we still have a long way to go. We are now actively participating in the new post-2015 MDGs and in the sustainable development goals, having to do with the environment.

Mr Kennedy, you mentioned that cuts prolong a crisis and that balance is needed. This is a critical item. We can not only go for fiscal consolidation, reducing the deficits, but many countries need fiscal consolidation, because otherwise the markets take away their confidence and they will not be able to finance themselves. By the time we find that out, it is too late. We do not want to get to that level. So there is a combination of those things.

Let me tell you, in respect of a recurrent theme, that always – even in very tight budgets and difficult fiscal situations – we have to leave room for the social, health, education, infrastructure and youth policies, and activation policies to get people back to work. There is always room, even with tight budgets and fiscal consolidation.

      I congratulate Mr Binley because his grandmother is a great economist – we invite her to help us. He said that this was common sense and that citizens understood the problems, which were not very complex. If we explain things well and are transparent and honest, people will support us in getting to the right places.

      Mr Hunko, you mentioned that salaries in Germany were low. Germany is a labour success story and now has lower unemployment than before the crisis, but it does not have a minimum wage, although one is being discussed. It is not so important whether you have a minimum wage, however; what matters is reducing pay gaps and avoiding the pernicious appearance of what most developed countries have, which is dualism in the labour market – this includes Japan, the United States, Italy and so on. By dualism I mean that one half of the labour force has all the guarantees – perhaps too many guarantees – while the other half has none. And who are the ones left out? Typically, the ones left out are the young. They are knocking at the door, but cannot enter.

      As Mr Sasi said, the Nordic countries are the most taxed yet most satisfied countries in the world, because their people believe that what they get back for what they give is appropriate. It is the social contract at its best. People are willing to make a contribution in order to get something back.

      The greatest problem for Europe is “the crocodile”, as the Germans call it. Unit labour costs in France, Italy, Greece, Portugal, Ireland and Germany vary – on a graph, the lines look like a crocodile’s mouth – yet they have a single currency. The 30% or 40% difference, which has built up over 12 years, is the cause of the competitiveness gap. It was not an accident – nothing happens by coincidence – and we have to fix it. Germany is now increasing its unit labour costs, and other countries are reducing them, so there will be a much-needed convergence.

      The question of skills was mentioned several times. It is not just a question of unemployment. We have millions of unemployed people and many thousands of companies saying, “We cannot find the right skills for our company to develop”. This is an enormous paradox. It means that we got it wrong. We have a mismatch between the types of skills we are producing in universities and vocational training and the needs of the market. We have to address that and are now working on a major skills initiative.

      THE PRESIDENT* – We all greatly appreciate your commitment and conviction, Mr Secretary-General, but could you please draw your remarks to a close?

      Mr Gurría (Secretary-General of the OECD) – I would simply say that pensions, health and education go beyond GDP. We have something called the better life index. We now know that it is not enough simply to generate nominal growth; we also need the distributional or social impact – in other words, equality – but we just said that inequality was growing. That will not lead to growth; inequality is an obstacle to growth. So we have to keep social matters in mind.

      Ms Guzenina-Richardson mentioned the word “hysteresis”. It sounds like a sickness and is a very strange name – it is Greek of course and refers to long-term unemployment, which we have never had to this extent. It is corrosive, it is perverse, it is very bad – it separates people permanently from the market, with the danger that they will never connect again, resulting in the loss of a whole generation. It is difficult to get them from school to work, but once they leave work, we cannot get them back.

      I say to the Spanish delegation, “La deuda, la deuda, la deuda”. Of course, it is one of the biggest problems and the reason we need consolidation. For that reason, I congratulate Spain on consolidating its debt. At the same time, however, it has also made many structural changes to the labour market, and as a result is solving the problem it had. It previously had a 10% current account deficit, but is now close to balancing its current account. It had a huge deficit with Europe, but is now running a surplus. These changes are being made in Spain, as well as in several other countries, so yes we need consolidation, but we also need structural change.

      Mr Recordon talked about growth versus the environment. We are on a collision course with nature and have to change course. As we heard this week, temperatures will rise by more than 2°C if we do not do anything, and it will take longer and more money to get back on the right course, so we have to take the environment into consideration.

      I say to the Japanese that I have been a great supporter of Abenomics and the three arrows, and I welcome the decision, confirmed today, to increase VAT. We hope that it goes from 8% to 10%.

      The OECD is not a club of the rich – a good example of that is the fact that a Mexican leads it. Furthermore, not only is Chile a member, but we will soon be joined by Colombia, Costa Rica and Russia. It is a diverse organisation. We are not a think-tank, but a do-tank. We recommend policies. We do not simply have discussions and produce papers. I would like to leave you with that idea: we are a do-tank, not a club of the rich.

      Last but not least, I say to the Mexicans that co-operation on development is critical. The crisis has left many countries needier than ever, so we must be generous, but what is happening? Aid – overseas development assistance – is dropping in real terms, instead of increasing, as it should, as a result of the crisis. I ask everyone to tell their governments that the poorest of the poor are suffering and still need your support. I also congratulate the Mexican Government and the Mexican Parliament on their reforms, which are a good example of the success that can be achieved when parliaments, governments and society get together.

      THE PRESIDENT* – Thank you, Mr Gurría. I understand that the rapporteur agrees to do without his speaking time, so we move straight on to the vote.

      The Committee on Political Affairs and Democracy has presented a draft resolution contained in Document 13301 to which nine amendments have been tabled.

      May I remind colleagues that for this part of our proceedings voting will be by show of hands to allow delegates from non-European members of the OECD, who do not have voting cards, to participate? When voting, please ensure that your hand remains in the air until all votes have been counted. I should remind you that from among the visiting delegations only those from members of the OECD are entitled to vote.

      I understand that Mr von Sydow wishes to propose to the Assembly that the following amendments, which were unanimously approved by the Committee on Political Affairs and Democracy, should be declared as adopted by the Assembly under Rule 33.11: 1, 2, 4 and 5.

      Is that so, Mr von Sydow?

Mr von SYDOW (Sweden) – Yes.

      THE PRESIDENT* – Does anyone object?

      As there is no objection, I declare that Amendments 1, 2, 4 and 5 to the draft resolution have been adopted.

      The following amendments have been adopted:

      Amendment 1, tabled by Mr Van der Maelen, Mr Jensen, Mr Mahoux, Mr Bremer, Ms Marjanović and Mr Schennach, which is, in the draft resolution, paragraph 3, to replace the words:

      “While there are at last signs of a recovery, most notably in the United States and in Japan, growth prospects remain weak in most OECD countries” with the following words: “

“There are at last signs of a recovery, most notably in North America, Japan and the United Kingdom, while the euro area as a whole is no longer in recession. A sustainable recovery is however not yet firmly established”.

Amendment 2, tabled by the Committee on Social Affairs, Health and Sustainable Development, which is, in the draft resolution, at the end of paragraph 11, to add the following sentence:

“The enlarged Assembly furthermore invites the OECD to use this initiative to examine the risks posed by covert banking activities and propose measures for improving supervision and regulation, as recommended by the G20 Summit held in St. Petersburg on 5 and 6 September 2013.”

       Amendment 4, tabled by the Committee on Social Affairs, Health and Sustainable Development, which is, in paragraph 17, after the words “To ensure fair taxation of global profits”, to insert the following words: “and enhanced tax compliance”.

       Amendment 5, tabled by the Committee on Social Affairs, Health and Sustainable Development, which is, at the end of paragraph 18, to add the following sentence:

“The enlarged Assembly believes that the OECD should strengthen its definition of a tax haven and clarify which tax regimes can be categorised as harmful tax practices.”

The remaining amendments will be taken in the order set out in the Organisation of Debates.

We come now to Amendment 6, tabled by Mr Rivard, Mr Hawn, Mr Shipley, Mr Mitchell and Mr Binley, which is, in the draft resolution, paragraph 10, to delete the word “While” and the words “, it also supports the call of the Trade Union Advisory Committee to the OECD (TUAC) that financing fiscal consolidation through cuts in public services, in social security and pensions would only prolong the jobs crisis and risk a social crisis”.

      I call Mr Rivard, Observer from Canada, to support Amendment 6.

      Mr RIVARD (Canada) – Mr President, there is no consensus that fiscal consolidation through cuts in public services, pensions and social security will prolong the economic difficulties faced by many OECD member countries. Sound public finances are the foundation of any country’s overall economic plan, providing certainty for markets and ensuring that that country has the resources to make targeted investments to support growth and foster job creation. Thank you.

      THE PRESIDENT* – Does anyone wish to speak against the amendment?

      I call Mr Van der Maelen.

      Mr Van der MAELEN (Belgium) – Thank you, Mr President. I invite colleagues, as I did in the committee this morning, to read paragraph 10. It is a very balanced paragraph. We noticed today that some of us defend fiscal consolidation without caring too much about social impact, but then others say that you cannot have fiscal consolidation because it harms the social fabric of our countries too much. I think both are wrong. What we propose in this text is that most countries need fiscal consolidation, but that we should please be aware of the social impact it can have. I ask the plenary enlarged Assembly to vote for the balanced text and not to opt for one of the two more radical positions.

      THE PRESIDENT* – What is the opinion of the committee?

      Mr von SYDOW (Sweden) – The committee is against.

      THE PRESIDENT* – The vote is open.

      Amendment 6 is rejected.

      We come now to Amendment 3, tabled by the Committee on Social Affairs, Health and Sustainable Development, which is, in paragraph 16, the first sentence, to replace words “has taken” with the following words: “should take”.

      I call Mr Ghiletchi to support Amendment 3.

      Mr GHILETCHI (Republic of Moldova) – I do not wish to press the amendment.

      THE PRESIDENT* – Amendment 3 is not moved.

      We come now to Amendment 7, tabled by Mr Rivard, Mr Hawn, Mr Shipley, Mr Don Davies, Mr Mitchell and Mr Binley, which is, in the draft resolution, paragraph 17.2, to delete the words “as a first step towards a possible multilateral agreement on a system of unitary taxation of transnational corporations”.

      I call Mr Rivard to support Amendment 7.

      Mr RIVARD (Canada) – Thank you, Mr President. Neither the G8, nor the G20, nor the OECD has supported working towards any multilateral agreement on a system of unitary taxation of transnational corporations. The possible benefits of unitary taxation, as listed in paragraph 59, are unsubstantiated, and Canada supports the call in paragraph 62 of the rapporteur’s report for country-by-country reporting, which is consistent with the OECD action plan.

      THE PRESIDENT* – Does anyone wish to speak against the amendment?

      I call Mr Van der Maelen.

      Mr Van der MAELEN (Belgium) – We discovered during the debate that there is a difference of opinion between our Canadian delegation and your rapporteur. Patching up the current system will not work. We could go on discussing this for hours. I suggest, like one of our colleagues said, that we wait a couple of years and then evaluate the result, and see if an end is coming to the game of “Tax me if you can”. I invite the Assembly to vote against the amendment.

      THE PRESIDENT* – What is the opinion of the committee?

      Mr von SYDOW (Sweden) – The committee is against.

      THE PRESIDENT* – The vote is open.

      Amendment 7 is rejected.

      We come now to Amendment 8, tabled by Mr Rivard, Mr Hawn, Mr Shipley, Mr Mitchell, Mr Don Davies and Mr Binley, which is, in the draft resolution, to replace paragraph 17.3 with the following paragraph:

      “call on all jurisdictions to commit to implement the global standard on automatic exchange of information and the Enlarged Assembly looks forward to the Global Forum on Exchange of Information for Tax Purposes establishing a mechanism to monitor and review the implementation of that standard.”I

      I call Mr Rivard to support Amendment 8.

      Mr RIVARD (Canada) – Thank you, Mr President. Neither the G8, nor the G20, nor the OECD has endorsed a big-bang approach to ensuring participation by all jurisdictions in a new standard of multinational information exchange.

      THE PRESIDENT* – Does anyone wish to speak against the amendment?

      I call Mr Van der Maelen.

      Mr Van der MAELEN (Belgium) – Thank you, Mr President. The difference between the amendment and the text proposed in paragraph 17.3 is that our Canadian colleagues are omitting the need for transparency of beneficial ownership. That is one of the great breakthroughs of the OECD and the G20, so I would love to see this enlarged Assembly vote against this amendment. This is really important. If we want tax fairness, we need transparency on beneficial ownership.

THE PRESIDENT* – What is the opinion of the committee?

      Mr von SYDOW (Sweden) – The committee is against.

      THE PRESIDENT* – The vote is open.

      Amendment 8 is rejected.

      We come now to Amendment 9, tabled by Mr Rivard, Mr Hawn, Mr Shipley, Mr Mitchell, Mr Don Davies and Mr Binley, which is, in the draft resolution, paragraph 18, to delete the following words: “that continues to be encouraged by tax havens”.

      I call Mr Rivard to support Amendment 9.

      Mr RIVARD (Canada) – The use of the term “tax havens” is problematic, in that it has not been defined and continues to be subject to multiple interpretations. Equating tax evasion with tax havens specifically is not necessarily appropriate.

      THE PRESIDENT* – Does anyone wish to speak against the amendment?

      I call Mr Van der Maelen.

      Mr Van der MAELEN (Belgium) – Thank you, Mr President. The committee voted against this, and with good reason, because I hope that there is no one in this Chamber who did not notice at the beginning of this year that offshore leaks became quite evident – that aggressive tax evasion is organised through tax havens. I do not understand why our Canadian colleagues want to omit this from the resolution.

THE PRESIDENT* – What is the opinion of the committee?

      Mr von SYDOW (Sweden) – The committee is against.

      THE PRESIDENT* – The vote is open.

      Amendment 9 is rejected.

      We will now proceed to vote on the whole of the draft resolution contained in Document 13301, as amended.

      The vote is open.

      I must remind you that the vote is in progress to elect a judge to the European Court of Human Rights for Romania. The poll will close at 1 p.m. and reopen during the afternoon sitting before closing at 5 p.m. Those who have not yet voted may still do so by going to the area behind the President’s chair.

      (Mr Mignon, President of the Assembly, took the Chair in place of Mr Boden.)

      THE PRESIDENT* – I also remind you that the vote for the election of a judge of the European Court of Human Rights for Romania is under way and you are strongly encouraged to vote.

      3. Address by Mr Sergey Naryshkin, Speaker of the State Duma of the Russian Federation

The PRESIDENT* - We now have the honour of hearing an address by Mr Sergey Naryshkin, Speaker of the State Duma of the Russian Federation. After his address, Mr Naryshkin has kindly agreed to take questions from the floor.

It is a real honour for us to welcome you here in Strasbourg. The Russian Federation is a key player on the European and international political scene. Discussions on the Syrian conflict are a perfect example of how much the international community needs the support of the Russian Federation to come up with solutions when faced with the most serious and urgent international political problems. With this in mind your arrival in Strasbourg is of paramount importance for our Assembly, because it comes at a time when we will be examining, based on the urgent debate procedure, the situation in Syria. This debate will be held on Thursday morning. The same goes for attempts to develop new synergies in the actions carried out by the Council of Europe and the European Union in the field of protecting human rights. We are all very keen to hear what you have to say on these different matters.

The Russian Federation has been a member of our Organisation for the past 17 years and I sincerely believe your country’s record on taking part in the activities of our Organisation is a positive one. Of course we do not agree on every issue and there are some laws in your country that give rise to questions when it comes to respecting our standards. This having been said, however, in a large number of matters Russia’s experience could do well to be shared with other member States. Let me mention federalism, protecting the rights of international minorities and intercultural dialogue.

Our Assembly is a forum for debate where parliamentarians come together and express their ideas and opinions freely. I am therefore delighted that we can continue with this dialogue here today at the very highest level. I sincerely hope we will have an opportunity to bring our positions closer together and strengthen our co-operation in a spirit of frankness, respect, friendship and openness.

Mr NARYSHKIN (Speaker of the State Duma of the Russian Federation)* - I thank Mr Jean-Claude Mignon, President of the Parliamentary Assembly, for the invitation to address the Assembly. I would like to begin my statement in French in order to underscore my deepest respect for France – for its great culture and history, for the inhabitants of this city, and for the Strasbourg-based Organisation.

Colleagues, as you know, one year ago my proposed visit here did not take place, but the reasons for postponing it then have now become even more serious reasons for us to meet. I see there is a renewed attempt to disrupt the work of the Assembly and to distract its attention away from addressing the more essential issues, such as the need for a profound reform of the parliamentary monitoring system. I shall return to that important issue.

In my meetings in Moscow with Mr Jagland and Mr Mignon, whom respect greatly, I became even more convinced that the burden of responsibility that has been bestowed on European Parliaments is growing. It is unprecedentedly high today. We meet in a dramatic moment of our history. Even though it may seem that events in Syria are taking place far from Europe, their origin and development highlight that threats to the world order are related to defiance of the law and of the fundamental principles of the world order, which were laid down here on the European continent in the aftermath of the worst possible scenario. That can affect all our countries, which is why the most dangerous thing to do is remain a passive and silent onlooker.

We in Europe know only too well what acquiescence and indifference can lead to. When Europe slid into the First World War the loss of human life reached millions, and in the Second World War tens of millions.

The firm position of certain European countries has been noticed. I am thinking in particular of the famous vote by the British Parliament forbidding its government from taking part in air strikes against Syria. The Russian President’s initiative on a peaceful resolution in Syria has gained broad support and is now being implemented. We all know the result of the vote on the UN Security Council resolution a few days ago.

The centuries-old European commitment to humanist values that underpin the legal systems and the very course of development of this continent has played a vital role. Why am I dwelling on this point? I do so because the events of World War Two are slowly being forgotten, and lessons are being rewritten to the point of distorting the causes of the worst tragedy of the 20th century.

Back then the Nazis proclaimed their superiority and uniqueness and cynically mapped out the total elimination of certain ethnic groups across Europe. Being indifferent to such a dangerous ideology became extremely costly and I want to read a quote: “indifference can be tempting - more than that, seductive” but indifference to others’ “suffering is what makes the human being inhuman” and benefits the aggressor. That was said by humanist Nobel peace prize laureate Elie Wiesel.

Next year we will be marking the 100th anniversary of the outbreak of the First World War which resulted in the devastation of all of Europe. In Russia it led to chaos: the disbanding of the first newly created Parliament, the 1917 revolution and a civil war. Meanwhile, the aggression that took place then was not suppressed but lay in wait, and it re-emerged just 20 years later. That led to another conflagration, this time global, and millions of victims. The Nazis’ crimes against humanity were denounced at Nuremberg, and the decisions of that tribunal are unchallengeable, yet some of today’s politicians seem to be forgetting that. They also seem to be forgetting that both world wars were unleashed against the backdrop of the acquiescence of those who, for a time, felt unaffected by the forces that were already claiming freedom and lives in other countries.

      As chairman of the Russian Historical Society and head of the national committee preparing for the 100th anniversary of the First World War, I believe that these lessons should not be forgotten and that the protection of historical truth should be a matter of concern in national education policy and European youth policy. With that in mind, I propose that the Nuremberg tribunal documents should be studied in secondary schools, not just in universities. The tribunal’s most important documents should be available in all European languages and posted on the websites of the Council of Europe, the United Nations, the OSCE and other organisations.

      As in the past, people around the world are tentatively following events in Europe, its social, economic and political processes and our parliamentary debates, because it was on European soil that great discoveries and technological breakthroughs were made and legal and socio-political theories emerged, leading to progress, freedom and the dignity of human life.

This distinguished audience is fully aware that there can be no general rule of law without morality. We cannot turn a blind eye to behaviour that falls outside legal and, more importantly, ethical norms. That is why in early September Russian parliamentarians initiated the idea of meeting their American counterparts to discuss the situation in Syria. However, as you probably know, the invitation was declined. In other words, they prefer to make decisions without listening to different arguments. That is unprecedented in parliamentary practice.

I am convinced that parliamentary democracy is playing an increasingly important role in today’s world. Representative democracy, which emerged in Europe thousands of years ago, is a time-tested and necessary institution, and not only for preserving hard-earned global security, but for the functioning of modern States in general. The second half of the 20th century saw an unprecedented growth in a sense of common European unity and responsibility. That is what made it possible in 1945 to create the United Nations, followed four years later by the Council of Europe and its Parliamentary Assembly. This institution can and must attend to the most challenging and important issues facing Europe and the world as a whole. They cannot be glossed over. They should be included in the main agenda and due consideration should be paid to differences of opinion and the diverse approaches voiced in this Assembly. That is the only way to find solutions that can be acceptable to 800 million Europeans.

With regard to criticism of Russia, or any other country, that is inevitable. In our national parliaments we are used to being criticised even more harshly. However, a biased approach can devalue even the loftiest of common goals and undermine all constructive efforts. That impression inevitably arises as a result of attempts to impose on Russia and several other countries endless lists of new obligations, such as those relating to the Parliamentary Assembly’s monitoring procedure and its possible transfer to the Committee of Ministers.

Another issue for which consideration is long overdue is that of replacing the current model of country-specific monitoring with one of subject-specific monitoring. The current practice of focusing on so-called “emerging democracies” is outdated. It essentially divides the Parliamentary Assembly into the elite and the outcasts, with the former always being above reproach and the latter inevitably being found to be at fault. That approach might have been justified in the early stages of a member State’s membership, in view of its tentative steps on the path towards democracy, but now it looks unfair and anachronistic. I would even say that it is politically discriminatory. As a result, we think that it is necessary to revise fundamentally the existing monitoring procedure, a view shared by other delegations. We will insist on that and make concrete proposals. There are other issues relating to work of the Council of Europe, and we are not the only ones to speak about that in the Parliamentary Assembly. Sometimes these problems are very real, but the issue is how we can jettison the dead weight we are lugging around without passing it on to future generations.

Allow me to outline some of the main challenges that I think determine the degree of our mutual understanding and the main contents of our agenda. They concern us as legislators. The first challenge is the general state of law and rights around the world, its evolution and the role of parliamentarians in protecting the law and legal rights. Above all, the law should be protected from being hijacked by non-legal considerations, including the politicisation of procedures that are of a purely legal nature. Amid the crisis and other global processes, such tendencies are becoming increasingly evident. Our duty as legislators is to safeguard the law. The same can be said of standards of international law. Developing these standards requires a joint will, but destroying them requires the will of only a few individuals.

The Council of Europe, with its unique legal basis, can play a key role in that regard. Furthermore, we know that the modern legislative process cannot be conducted behind closed doors, access to which is no longer confined to the chosen few. The process should be made transparent to the public, and it should be subjected to dialogue throughout the deliberation of the various legal initiatives. Based on our own recent experience, it is the lack of feedback that leads people to question the legitimacy of government decisions and the fairness of the courts. On certain internet portals, people are inculcated with the idea of the absolute character of their individual freedoms, against the total absence of any legal obligations. Voltaire warned that true freedom means being dependent only on the law.

That leads me to the third relevant challenge. New communication technologies have an important influence on the political agenda. We are witnessing a virtual world, with its own public opinion technologies that transcend national borders, building strength in parallel with traditional parliamentary and other institutions of democracy. It has formed numerous interest groups, and even highly trendy debate forums. Some people even consider the onset of the internet age to signify the demise of classic parliamentary democracy, since social networks are now considered the mouthpiece of the people. Their influence is undoubted, but I insist that in these circumstances the responsibility of parliaments has become even more important. That situation is likely to continue until a new electronic democracy and its attendant procedures acquire their own unequivocal legal forms, and until then they have to pass the test of time and be proven free of error. Otherwise, that might prove detrimental to future generations. At the same time, growing civic activism must be welcomed, rather than seen as a threat. It offers unexplored opportunities for democratic development. Since the vast majority of internet users are young people, these technologies not only provide a direct link to their leaders, but make it possible to respond to innovative ideas and demands.

The fourth challenge is the urgent need to focus on a truly relevant, pertinent agenda. For example, we should consider the phenomenon of large-scale non-citizenship. For many people in the European Union, that is no longer considered as undemocratic. Is this not a substitution of the meaning of modern democracy, something that goes back hundreds of years? That is just one of the most flagrant examples in the contemporary world, but there are other common threats and challenges, such as terrorism, ethnic conflicts, drug trafficking, cross-border crimes, illicit trafficking in human organs and, once again, a neo-Nazism that erodes, both in its open and latent forms, historical memory.

      The fifth challenge is closely connected to the issues I have already mentioned. There is a clear lack of qualitative breakthroughs in inter-parliamentary work. It is particularly important to mention that from this podium. Indeed, the Parliamentary Assembly provides a unique platform to address common issues, and serves as a model for other associations and integration. In dealing with Euro-Asian economic integration, we are, to a large extent, guided and inspired by the European model. I stress that our current interaction not only needs new formats, but deeper strategic content. For example, democracy, human rights and the rule of law are intertwined with many other development priorities. However, when pseudo-relevant or disputed topics overshadow the issues relating to the development of culture, education, science or public health, this narrows the scope of the work of the Parliamentary Assembly. Many areas of work that are important to our citizens are then undermined and they deserve our constant collective attention.

      I thank my counterparts from many other countries for their participation last year in the international parliamentary forum that took place in Moscow. We discussed pressing issues, such as parliamentarianism, new threats to democracy and new legislative trends. This year, in mid-November, a second forum will take place in Moscow and I would be happy to see you there once again. This is a landmark year for Russia. December will mark the 20th anniversary of the Russian constitution and the first elections to our modern Parliament. This was a turning point and the anniversary represents a milestone for us, enabling us to examine modern issues relating to parliamentarianism.

Russia has been a member of the Council of Europe for most of the past 20 years. This period has been marked by the development of new legislation, the accession to dozens of Council of Europe conventions, the right of our citizens to apply to the European Court and many other developments. The accession of the largest country on the continent to the Council of Europe was not just a landmark event for Russian citizens: we bring many meaningful topics for discussion to the Parliamentary Assembly. I support the efforts of the Secretary-General, Mr Jagland, and his colleagues, to overhaul the Council of Europe. I believe that all areas of activity of this Organisation in Strasbourg should be considered equally important, because each seeks to strengthen human rights and pluralistic democracy. Russia will continue to apply the principles of the Council of Europe in its European affairs.

      I will briefly outline some of the issues relating to modern Russian policy that are of most concern to our foreign partners, and sometimes to ourselves. Of course, I will not be able to cover all aspects due to limited time.

      The first issue of concern is the so-called law on foreign agents. Our main aim was to ensure financial transparency in organisations and that is what we have done. However, we have always examined thoroughly the application of this law, as well as other laws, and, judging by the results, we may introduce certain changes. There are ongoing discussions about a more precise definition of “political activities”. The Russian ombudsman, Vladimir Lukin, has filed a complaint with the constitutional court with regard to this law, and our Parliament has always treated the position of the constitutional court with respect. Some people believe that the term “foreign agent” has a negative connotation. I do not want to get into linguistics, but we are all well aware that there are similar terms in other countries.

      On the law relating to demonstrations and mass events, Russia, like other countries before it, has made the responsibility for committing offences during demonstrations clearer. I emphasise that we speak about the responsibility for committing specific offences, not participation in demonstrations – the law has nothing to do with restricting the constitutional right to freedom of assembly. Various demonstrations, rallies and protests continue to be held and we support this. The adopted law has not influenced civic engagement; it has dampened the zeal of instigators and troublemakers.

      On laws relating to so-called blacklists of Internet sites, I would like to say straight away that there are no blacklists – that is not the right word. The Internet has always been a place of freedom. It is available to everyone, including children, but the State has special services to eliminate security threats, including terrorist threats. Parents are, unfortunately, deprived of such resources. How can they protect their children from pornography, drugs or propaganda on suicide? We believe that the State has a responsibility in these matters and many other countries have followed a similar path. Open and clear standards of behaviour on the Internet are much more in line with European values than attempts to combine declarations about the freedom of the Internet with the development of a system of total control over electronic communications that are not based in law - a system that, in fact, permits control over freedom of thought. On account of their openness, legal mechanisms can always be improved. That is not the case with technology, which lacks public control.

      Edward Snowden has spoken about this. Russia’s decision not to extradite him to the authorities in the United States is absolutely justified for many reasons. His treatment in the US could be unfair and not in accordance with law. There were no moral grounds to hand over Mr Snowden, who has told the world about the violation of the human rights of hundreds and hundreds of people around the world.

      Another law that is often criticised abroad concerns propaganda about non-traditional sexual relations among minors. Many who comment on this law – whether deliberately or not – omit or forget the words in the title “among minors”. That is a distortion of the content and the motivation for the law’s adoption. Concerns have been voiced that it could become an instrument of discrimination against minorities. I do not share those concerns, not only because there is a lack of relevant examples. People of non-traditional orientation do not face any restrictions on any grounds in their work, education, social or political activities. They are free to shape their life in accordance with their preferences. However, before they come of age, children should not be forced into anything or subjected to propaganda.

      My final point is about the law on criminal liability for offending religious feelings. I underline that people in Russia have not yet forgotten the persecution of religion and beliefs during the Soviet era. Many Russian citizens expect a democratic State not only to recognise but to protect their religious feelings and beliefs.

I have a question: is not the equality of all people before the law a common European value, or perhaps some of your countries have few religious people who do not feel indignant when their religion is insulted, their Christian or Orthodox churches or crosses are desecrated or fundamental rights and values are violated? On the whole, I consider it inadmissible to uphold some people’s rights while ignoring those of others, even if the former are overly proactive or sometimes aggressive and the latter remain silent. In a State based on the rule of law and in a civilised society, such a situation should not arise. I repeat our appreciation of the fact that the Parliamentary Assembly makes a substantive contribution to the religious dimension of cross-cultural dialogue, and we hope that that will continue.

      I have not been able to cover every topic, and not everyone will be satisfied with my address, especially those used to strictly legal argumentation, with references to well-known resolutions and specific legal texts. However, my colleagues from the State Duma and the Federation Council have repeatedly provided such arguments, including in the Parliamentary Assembly, and today, I wanted to be heard not only by you, my dear and truly respected members of the Parliamentary Assembly, but by European citizens who may not be as familiar with legal fine points and formulas as you legislators, and who may find my plain words easier to understand and more convincing.

Between black and white there is a whole range of colours, but black always remains black and white always remains white. Just like the two eternal moral values of good and evil, people can always distinguish between them. We, who have been elected by our peoples, cannot treat moral values as abstract and unconnected to the law. As the Speaker of the Russian Parliament, I never tire of repeating that point. I again say that what I wanted to do, in all sincerity, was to make some points that are the most important ones for those who wished to listen.

      In conclusion, each one of us has a great responsibility for what happens in our common home and for its sustainable development. The people of the nations of Europe have much more in common than the things that divide us. Indeed, European humanist ideals make up our common platform, and in that respect we are unconditional allies, as I believe we should be on all issues relating to the well-being of our peoples. To focus on disagreements and conflicts will only lead to defeat for us all, and I am sure that we will not choose such a path.

      I sincerely thank you for your attention, and I invite you all to come to Russia.

      THE PRESIDENT* – Thank you very much, Mr Naryshkin. Members of the Assembly have questions to put to you. I remind colleagues that you must ask a question, not make a general political statement. You have 30 seconds each. The first question is from Mr Agramunt on behalf of the Group of the European People’s Party.

      Mr AGRAMUNT (Spain)* – Mr Naryshkin, the neighbouring countries in eastern Europe, including Ukraine, Moldova, Georgia, Armenia and Azerbaijan, that will take part in the next summit in Vilnius, have told us about various forms of pressure exerted by Russia to prevent their achieving greater integration with western Europe. I am thinking of the occupation of Georgia and pressures exerted on Armenia, for example. What do you have to say about that?

      Following the provisional agreement on chemical weapons in Syria, are there greater prospects of achieving peace between the warring parties?

Mr NARYSHKIN* – Thank you for your two excellent questions, which were about relations between countries within the Commonwealth of Independent States, and about Russia’s position on the Syrian conflict.

       Russia has a great deal of political, economic, humanitarian and military co-operation with the countries of the Commonwealth of Independent States, including Ukraine and the others that were mentioned. There is no doubt that Russia, Belarus and Kazakhstan, as members of a customs union and of a single economic area, are interested in broadening the common economic area and in extending the customs union to cover Ukraine and other members of the Commonwealth of Independent States. However, all the States that were mentioned are sovereign States, and their governments and peoples must decide which organisations they join; Russia is not exerting any pressure on them. The only right that we exercise is the right to provide comparative information – our assessment of the benefits that such countries would obtain from joining the customs union or the single economic area, and of the consequences of their becoming associate members of the European Union – but each sovereign State can make its own choice.

      In relation to Ukraine, and possibly to other countries in the Commonwealth of Independent States, whatever agreement it signs or whatever organisation it joins, Russians will always feel fondness and concern for those who live in Ukraine, because they are our brethren in blood and religious beliefs.

      On Syria, our position is clear and well known: from the beginning, Russia has been in favour of a peaceful resolution of the very serious Syrian conflict. We have always considered, and still do, that possibilities for the peaceful resolution of any conflict are never exhausted. First and foremost, we are categorically opposed to the use of such non-diplomatic means as air strikes against a sovereign State. That it is possible to have a peaceful resolution is confirmed by the Russian President’s initiative to put chemical weapons in Syria under international control, and implementation of that initiative has begun.

Russia is often blamed. With regard to Syria, we are told that we blocked the adoption of a resolution by the UN Security Council that would have authorised the possibility of military intervention by foreign forces. We could not accept that. We can never remain silent in the face of injustice or when there is a threat of aggression against those who are weak. In that regard, I recall the words of the German humanist and theologian, Martin Niemöller. I know his poems from the Russian translations. He wrote something like this:

“First they came for the communists,

and I didn’t speak out because I wasn’t a communist.

Then they came for the social democrats,

and I didn’t speak out because I wasn’t a social democrat.

Then they came for the trade unionists,

and I didn’t speak out because I wasn’t a trade unionist.

Then they came for the Jews,

and I didn’t speak out because I wasn’t a Jew.

Then they came for me,

and there was no one left to speak for me.”

Thank you for your very good questions.

THE PRESIDENT* – I call Mr Jensen to speak on behalf of the Socialist Group.

Mr Mogens JENSEN (Denmark) – Russia’s adoption of the so-called propaganda law has been condemned around the world. The supposed justification for the law – the protection of children – was rejected by the Venice Commission. In doing so, it sided with various human rights institutions. It concluded that there was no evidence that expressions of sexual orientation would adversely affect minors. Mr Speaker, will you explain to the Assembly what evidence the State Duma relied on when adopting that law, which is in violation of Russia’s international human rights obligations?

Mr NARYSHKIN* – That is an excellent question. Thank you for your interest in this topic. I addressed that issue in part during my presentation, but I am happy to add to what I said.

The goal of the law is clearly stated in its title – it is intended to protect children or minors from propaganda that denies traditional family values. It is true that in its convictions, Russian society is quite conservative. It has retained its moral, Christian, Orthodox values, including traditional family values. That is acceptable, as is enshrined in fundamental international documents. First, article 10 of the European Convention for the Protection of Human Rights and Fundamental Freedoms allows restrictions on propaganda. Secondly, the UN Convention on the Rights of the Child proclaims the principle that the traditions and cultural and ethical values of each State should be taken into account in ensuring the harmonious development of a child. Thirdly, the European Court of Human Rights has pointed out more than once that there is no single generally recognised and accepted moral or ethical principle. The law that we adopted is therefore fully in line with all the international obligations of the Russian Federation. I repeat that it reflects our traditions and our cultural and moral values. That is the first point.

Secondly, I once again reassure you that the rights of people in Russia with non-traditional sexual orientations are the same as those of citizens with more traditional family and other practices. As I said in my statement, we have many successful individuals who have a non-traditional sexual orientation in the areas of business, culture and the arts. Such people have the right to vacation anywhere. In Moscow, there are even gay clubs. I have never been to one, but I have been told that these people feel quite comfortable in them and can have a good time. I am being serious; I am not speaking to the gallery. If you want confirmation of what I am saying, I invite you to Moscow. Unfortunately, I will not be able to join you in visiting one of these places, but I will ensure that such a visit is organised. Come and visit me and you will see for yourself.

Thank you for your question.

      THE PRESIDENT* – I call Ms Brasseur to speak on behalf of the Alliance of Liberals and Democrats for Europe.

Ms BRASSEUR (Luxembourg)* – On behalf of the ALDE Group, I thank you, Mr Speaker, for agreeing to address the Parliamentary Assembly – the very house of democracy. It is only through contact and dialogue that we will be able to make proper headway.

My question relates to NGOs and foreign workers, which you mentioned in your address. I have heard that President Putin has served notice that the law in that area may well be modified. Has the State Duma given any thought to changing that law? If so, in which direction will it be changed and how long will it take?

Mr NARYSHKIN* – Thank you for your interest and for paying attention to the way in which the legislation is being implemented. I remind you that the law was enacted to achieve transparency in the work of non-commercial organisations. The whole of society wants transparency in the bodies of municipal government, other governmental structures, business structures, commercial structures and non-commercial structures. That is the aim of the law.

We have been monitoring the application of the law. That is a good instrument for seeing whether there are flaws in a piece of legislation and ways in which it can be amended or improved. We are currently discussing this legislation. As you mentioned, President Putin has spoken about it and it has been discussed in the State Duma. We have talked about the fact that the notion of political activity has to be made clearer. That is a critical notion in the application of the law. I do not exclude the possibility that we will have to do something about it. It is possible that we will make amendments, but there needs to be agreement among members of parliament for that to happen.

Overall, the law has the support of our citizens. Opinion polls show that there is full support for the legislation. We must all remember the fundamental principle that the only source of power in a democratic State is the people. We, as legislators, simply serve the wishes of our people and represent them in the discussions that we have.

      THE PRESIDENT* – Thank you. I now call Mr Aligrudić to speak on behalf of the European Democrat Group.

      Mr ALIGRUDIĆ (Serbia) – Mr Naryshkin, my question is short and general, although it may require a longer answer.

      On the development of democratic institutions and the honouring of democratic principles in Russia, what has the State Duma done since you became the speaker of parliament?

      Mr NARYSHKIN* – Thank you for an interesting and excellent question, which I am happy to answer, but first I want to recall that this year we are marking the 20th anniversary of the constitution and of the modern Russian Parliament and how, in those 20 years, the country, the State and our people have made huge strides along the path of democratisation. In this brief period, we have adopted laws regulating all areas of our life, including the work of civic institutions and the activity of political competition.

In the past few years, the State Duma has enacted a number of fundamental laws aimed at reforming the political system in our country. One law significantly simplified the creation and registration of political parties. In a brief one and a half years after the adoption of that law, the number of political parties soared, and there are now more than 70. In the federal elections of December 2011, seven political parties took part, with four of them being elected to the State Duma. In the recent regional and municipal elections, 54 political parties took part, with representatives of 31 parties being elected to office. Clearly, the level of political competition has grown significantly, and the State is supporting that in every way.

Furthermore, we have adopted a law on electing the heads of regions, as we used to do. Each region may choose the model for such elections: the governor of a region could be elected through a direct election or through a regional parliament. Also, a proposed law on the election of members of the State Duma has passed first reading; we will probably return to a mixed system, whereby some members of parliament will be elected on party lists and some in individual constituencies. The goal of such changes is to give smaller parties the opportunity to be elected to parliament, which they will have when the new law is enacted. Thus, the MPs who represent single districts will have more contact with their electors – a more direct link – so in this case the parliament will be fulfilling its second important role as a representative body.

Other initiatives include enhancing the role of expert assessments in the legislative process. Various expert bodies have been established, and we have achieved some good results in introducing e-parliament technology. Yesterday, we gave a presentation on our work in this field, and the technology may be unique in Europe. We are ready to help colleagues become more familiar with it.

My last point in response is that we have created a unique body called the Council of Non-parliamentary Parties. As I said, there are almost 70 political parties, and so those not in parliament are still involved in the legislative process. At the most recent meeting of the council, which I head, there were representatives of 35 parties. We discussed the results of the elections, trends in the development of electoral legislation and other important issues such as pension reform or the draft law on strategic planning. I see this institution as quite unique – I do not know if something like it exists in other European parliaments and, if not, we are ready to share our experience.

      THE PRESIDENT* – Thank you. I now call Mr Kox to speak on behalf of the Group of the Unified European Left.

      Mr KOX (Netherlands) – Mr Speaker, you have answered almost all my questions, but I have one remaining. I had the honour to lead the observation mission for your State Duma and presidential elections in 2011 and 2012. I could give you our conclusions and observations, but one of our main observations was that, in order to ensure really free and fair elections, an optimal functioning of the Central Election Commission is necessary – without an impartial judge and referee, you cannot have free and fair elections. Has there been any development in improving the functioning of the Central Election Commission, as recommended in our two reports?

      Mr NARYSHKIN* – We carefully heed the views of our European colleagues. I recall a useful and interesting meeting with you, and I hope that such meetings will continue. We are certainly ready to hear your proposals on how to reform the electoral system and to improve the work of the Central Election Commission, as well as the whole system. We are open to such contacts and dialogue. We understand that it is essential.

      Ms KARLSSON (Sweden) – Mr Speaker, in view of the situation on freedom of association and freedom of expression with regard to the LGBT rights of the Russian population, and in view of the widespread international criticism from countries such as Sweden and the United States, as well as from international organisations such as the Council of Europe, and in respect of the European Convention on Human Rights, what will Russia do to turn around this development of the last year into a positive one, marked by tolerance and respect for human rights and for the principle of non-discrimination, especially concerning sexual orientation?

      Mr NARYSHKIN* – Thank you. I wish to repeat that on this issue Russia has fully complied with the international obligations that it has undertaken. Russian legislation for the protection of children against information or propaganda denying traditional family values is fully in line with international standards. The Russian legislation – again based on international legal texts – also fully takes into account the national cultural and moral traditions of our society, as I have already mentioned. I repeat that the rights of individuals of non-traditional sexual orientation are as broad and as fully guaranteed as those of individuals with a more traditional sexual orientation.

Mr VILLUMSEN (Denmark) – I do not think that we got an answer to the question raised by Mr Jensen on behalf of the Socialist Group concerning the evidence that the State Duma used in imposing the anti-homosexual law, especially in regard to the Venice Commission’s clear statement that children need objective, relevant information on sexuality. I would like to hear the answer to this question.

Mr NARYSHKIN* – I am ready to repeat my answer a third time, if you insist.

THE PRESIDENT* – No. Speaker, we can talk about it, but unfortunately we are very short of time. Mr Reimann is the next speaker, then Ms Guzenina-Richardson, and then we must interrupt the list of speakers. Mr Reimann, you have the floor.

Mr REIMANN (Switzerland)* – We still have a few months before the opening of the Olympic games in Sochi. I would like to talk about various issues, including the gigantic costs of building the stadium, the facilities and so on. We have the impression that there is talk of a boycott as a protest against human rights violations in Russia. What do you have to say about that?

Mr NARYSHKIN* – I do not understand who spoke about a boycott, although I know that the idea has emerged in a number of troubled minds. I am thinking of the historical associations with the boycott of the Moscow games of 1980, which you will remember. It was initiated by one country, and those who suffered were the athletes of that country and the other countries that joined the boycott. The athletes from our country were also punished, because they did not go to the next Olympic games. If you recall, the grounds for the boycott involved the sending of Soviet troops to Afghanistan to combat the Taliban. Now, 20 years later, the country that initiated the boycott has sent its own troops there, and continues to fight the Taliban. You see how stupid and cynical all this is.

Ms GUZENINA-RICHARDSON (Finland) – Mr Naryshkin, we have an undeniable refugee problem. How will Russia participate? What is your advice to the Council of Europe? What should be our most urgent measures? You also mentioned the new law on the protection of religious feelings – the so-called Pussy Riot law. Could that law pose risks to freedom of speech?

Mr NARYSHKIN* – The issue of Syrian refugees is a very acute problem, as are the other problems related to Syria. I understand that there are now about 2 million Syrian refugees. It is a problem that will have to be dealt with by the whole international community. As we see it, the path towards dealing with this problem lies through peaceful resolution of the entire Syrian conflict. We have always insisted on that connection, and we are very much in favour of holding the Geneva conference, which could be an interim step in the process. The Geneva conference could bring together representatives of the current Syrian Government and the Syrian Opposition. It is through the process of peaceful internal political resolution that the solution to the problem of Syrian refugees should be dealt with. Of course they need emergency assistance. Russia has provided such assistance and will continue to do so.

On the adoption of the law on insulting religious feelings, I gave a fairly lengthy explanation of that law, the reasons leading to its enactment and the fact that it is in line with international standards. I do not want to repeat myself, so as not to waste time and to give everyone a chance to ask questions.

THE PRESIDENT* – Thank you, Speaker. Unfortunately, we have no more time, as it is already 1.15. We have overrun our time, and we must consider various constraints.

We must now conclude the questions to Mr Naryshkin.

I thank you again for your address and for the answers given to questions.

4. Next public business

THE PRESIDENT* – The Assembly will hold its next public sitting this afternoon at 3.30 p.m. with the agenda which was approved on Monday morning.

The vote to elect a judge to the European Court of Human Rights for Romania is now closed. It will reopen at 3.30 p.m. before closing at 5 p.m.

(The sitting was closed at 1.15 p.m.)

CONTENTS

1. Election of a judge

2. The activities of the Organisation for Economic Co-operation and Development (OECD) in 2012-13

Presentation of report by Mr Van der Maelen, on behalf of the Political Affairs and Democracy Committee (Doc. 13301)

Presentation of opinion by Mr Ghiletchi, on behalf of the Committee on Social Affairs, Health and Sustainable Development

Address by Mr Gurría, Secretary-General of OECD

Speakers: Mr Kennedy, Mr Binley, Mr Hunko, Mr Sasi, Mr Mogens Jensen, Mr Schwaller, Ms Guzenina-Richardson, Mr Bockel, Mr Díaz Tejera, Mr Hawn, Mr Reimann, Mr Timchenko, Mr Beneyto, Mr Recordon, Ms Santo, Mr Mendes Bota, Mr Jáuregui, Mr Fritz, Mr Gándara Camou,

Amendments 1, 2, 4 and 5 adopted.

Draft resolution contained in Document 13301 adopted.

3. Address by Mr Sergey Naryshkin, Speaker of the State Duma of the Russian Federation

Questions: Mr Agramunt, Mr Mogens Jensen, Ms Brasseur, Mr Aligrudić, Mr Kox, Ms Karlsson, Mr Reimann, Ms Guzenina-Richardson

4. Next public business

Appendix I

Representatives or Substitutes who signed the Attendance Register in accordance with Rule 11.2 of the Rules of Procedure. The names of Substitutes who replaced absent Representatives are printed in small letters. The names of those who were absent or apologised for absence are followed by an asterisk

Pedro AGRAMUNT

Miloš ALIGRUDIĆ

Jean-Charles ALLAVENA/Christian Barilaro

Karin ANDERSEN/Ingjerd Schou

Lord Donald ANDERSON

Paride ANDREOLI

Khadija ARIB*

Volodymyr ARIEV

Francisco ASSIS*

Danielle AUROI/Brigitte Allain

Daniel BACQUELAINE/Dirk Van Der Maelen

Theodora BAKOYANNIS

David BAKRADZE*

Taulant BALLA*

Gérard BAPT/Pierre-Yves Le Borgn'

Gerard BARCIA DUEDRA/Silvia Eloïsa Bonet Perot

Doris BARNETT*

José Manuel BARREIRO/Ángel Pintado

Deniz BAYKAL

Marieluise BECK*

José María BENEYTO

Levan BERDZENISHVILI/Tinatin Khidasheli

Deborah BERGAMINI*

Sali BERISHA/Oerd Bylykbashi

Anna Maria BERNINI*

Teresa BERTUZZI*

Robert BIEDROŃ

Gülsün BİLGEHAN

Brian BINLEY

Ľuboš BLAHA/Darina Gabániová

Philippe BLANCHART*

Delia BLANCO

Jean-Marie BOCKEL

Eric BOCQUET/Jacques Legendre

Mladen BOJANIĆ/Snežana Jonica

Olga BORZOVA

Mladen BOSIĆ*

António BRAGA*

Anne BRASSEUR

Alessandro BRATTI*

Márton BRAUN

Gerold BÜCHEL/Rainer Gopp

André BUGNON

Natalia BURYKINA

Sylvia CANEL*

Nunzia CATALFO*

Mevlüt ÇAVUŞOĞLU*

Mikael CEDERBRATT

Özlem CEKIC*

Elena CENTEMERO*

Lorenzo CESA*

Otto CHALOUPKA/Pavel Lebeda

Irakli CHIKOVANI

Vannino CHITI*

Tudor-Alexandru CHIUARIU/Viorel Riceard Badea

Christopher CHOPE

Lise CHRISTOFFERSEN

Desislav CHUKOLOV*

Lolita ČIGĀNE

Boriss CILEVIČS

Henryk CIOCH

James CLAPPISON

Deirdre CLUNE

Agustín CONDE*

Telmo CORREIA

Paolo CORSINI*

Carlos COSTA NEVES

Celeste COSTANTINO*

Jonny CROSIO*

Katalin CSÖBÖR*

Milena DAMYANOVA

Joseph DEBONO GRECH

Armand De DECKER/Fatiha Saïdi

Roel DESEYN*

Manlio DI STEFANO*

Arcadio DÍAZ TEJERA

Peter van DIJK

Şaban DİŞLİ

Aleksandra DJUROVIĆ

Jim DOBBIN*

Karl DONABAUER/Edgar Mayer

Ioannis DRAGASAKIS

Damian DRĂGHICI

Daphné DUMERY/Sabine Vermeulen

Alexander [The Earl of] DUNDEE*

Josette DURRIEU

Mikuláš DZURINDA

Baroness Diana ECCLES*

Tülin ERKAL KARA

Joseph FENECH ADAMI

Cătălin Daniel FENECHIU

Vyacheslav FETISOV

Doris FIALA/Maximilian Reimann

Daniela FILIPIOVÁ

Axel E. FISCHER

Jana FISCHEROVÁ*

Gvozden Srećko FLEGO

Bernard FOURNIER

Hans FRANKEN

Jean-Claude FRÉCON*

Béatrice FRESKO-ROLFO

Erich Georg FRITZ

Martin FRONC

Sir Roger GALE

Adele GAMBARO*

Karl GARÐARSON

Ruslan GATTAROV*

Tamás GAUDI NAGY

Nadezda GERASIMOVA

Valeriu GHILETCHI

Francesco Maria GIRO*

Michael GLOS*

Pavol GOGA

Jarosław GÓRCZYŃSKI/Iwona Guzowska

Alina Ştefania GORGHIU

Svetlana GORYACHEVA

Sandro GOZI

Fred de GRAAF*

Martin GRAF*

Sylvi GRAHAM*

Patrick De GROOTE

Andreas GROSS

Arlette GROSSKOST*

Dzhema GROZDANOVA

Attila GRUBER*

Gergely GULYÁS*

Pelin GÜNDEŞ BAKIR*

Antonio GUTIÉRREZ

Ana GUŢU

Maria GUZENINA-RICHARDSON

Carina HÄGG

Sabir HAJIYEV

Andrzej HALICKI*

Hamid HAMID

Mike HANCOCK*

Margus HANSON/Ester Tuiksoo

Davit HARUTYUNYAN

Håkon HAUGLI*

Norbert HAUPERT

Alfred HEER/Luc Recordon

Martin HENRIKSEN*

Andres HERKEL

Adam HOFMAN*

Jim HOOD

Joachim HÖRSTER

Arpine HOVHANNISYAN

Anette HÜBINGER

Andrej HUNKO

Ali HUSEYNLI

Rafael HUSEYNOV/Sahiba Gafarova

Vladimir ILIĆ*

Florin IORDACHE

Igor IVANOVSKI

Tadeusz IWIŃSKI/Zbigniew Girzyński

Denis JACQUAT/Frédéric Reiss

Gediminas JAKAVONIS

Stella JANTUAN

Tedo JAPARIDZE*

Ramón JÁUREGUI

Michael Aastrup JENSEN

Mogens JENSEN

Jadranka JOKSIMOVIĆ*

Ögmundur JÓNASSON

Čedomir JOVANOVIĆ/Svetislava Bulajić

Antti KAIKKONEN/Sirkka-Liisa Anttila

Ferenc KALMÁR

Božidar KALMETA/Ivan Račan

Mariusz KAMIŃSKI*

Deniza KARADJOVA

Marietta KARAMANLI/Maryvonne Blondin

Ulrika KARLSSON

Burhan KAYATÜRK*

Jan KAŹMIERCZAK*

Serhii KIVALOV

Bogdan KLICH

Serhiy KLYUEV/Volodymyr Pylypenko

Haluk KOÇ

Igor KOLMAN

Attila KORODI

Alev KORUN*

Tiny KOX

Borjana KRIŠTO

Dmitry KRYVITSKY/Yury Shamkov

Václav KUBATA/Miroslav Krejča

Ertuğrul KÜRKÇÜ

Athina KYRIAKIDOU/Stella Kyriakides

Jean-Yves LE DÉAUT

Igor LEBEDEV

Harald LEIBRECHT*

Orinta LEIPUTĖ

Christophe LÉONARD*

Valentina LESKAJ

Terry LEYDEN

Inese LĪBIŅA-EGNERE/Jānis Dombrava

Lone LOKLINDT/Nikolaj Villumsen

François LONCLE*

George LOUKAIDES

Yuliya L'OVOCHKINA*

Saša MAGAZINOVIĆ*

Philippe MAHOUX

Thierry MARIANI

Epameinondas MARIAS

Milica MARKOVIĆ*

Meritxell MATEU PI

Pirkko MATTILA

Frano MATUŠIĆ

Liliane MAURY PASQUIER

Michael McNAMARA*

Sir Alan MEALE/Geraint Davies

Ermira MEHMETI DEVAJA*

Ivan MELNIKOV

Nursuna MEMECAN

José MENDES BOTA

Jean-Claude MIGNON/Marie-Jo Zimmermann

Djordje MILIĆEVIĆ/Vesna Marjanović

Jerzy MONTAG/Viola Von Cramon-Taubadel

Rubén MORENO PALANQUES*

Igor MOROZOV

João Bosco MOTA AMARAL

Arkadiusz MULARCZYK

Melita MULIĆ

Lydia MUTSCH/Fernand Boden

Lev MYRYMSKYI*

Philippe NACHBAR*

Oľga NACHTMANNOVÁ

Marian NEACŞU

Fritz NEUGEBAUER

Baroness Emma NICHOLSON/Charles Kennedy

Michele NICOLETTI*

Brynjar NÍELSSON*

Elena NIKOLAEVA

Aleksandar NIKOLOSKI

Mirosława NYKIEL/Grzegorz Czelej

Judith OEHRI

Carina OHLSSON

Joseph O'REILLY

Lesia OROBETS

Sandra OSBORNE/Michael Connarty

José Ignacio PALACIOS

Liliana PALIHOVICI*

Dimitrios PAPADIMOULIS

Eva PARERA/Jordi Xuclà

Ganira PASHAYEVA*

Johannes PFLUG*

Foteini PIPILI*

Ivan POPESCU

Marietta de POURBAIX-LUNDIN

Cezar Florin PREDA

John PRESCOTT

Jakob PRESEČNIK

Gabino PUCHE*

Alexey PUSHKOV*

Mailis REPS

Eva RICHTROVÁ

Andrea RIGONI*

François ROCHEBLOINE*

Maria de Belém ROSEIRA*

René ROUQUET/Pascale Crozon

Marlene RUPPRECHT*

Pavlo RYABIKIN

Rovshan RZAYEV/Mustafa Dzhemiliev

Vincenzo SANTANGELO*

Kimmo SASI

Deborah SCHEMBRI

Stefan SCHENNACH

Marina SCHUSTER

Urs SCHWALLER

Senad ŠEPIĆ/Ismeta Dervoz

Samad SEYIDOV

Jim SHERIDAN

Oleksandr SHEVCHENKO

Boris SHPIGEL/Alexey Ivanovich Aleksandrov

Arturas SKARDŽIUS/Algis Kašėta

Ladislav SKOPAL*

Leonid SLUTSKY

Serhiy SOBOLEV

Lorella STEFANELLI

Yanaki STOILOV

Christoph STRÄSSER

Karin STRENZ

Ionuţ-Marian STROE

Valeriy SUDARENKOV

Björn von SYDOW

Petro SYMONENKO*

Vilmos SZABÓ*

Chiora TAKTAKISHVILI

Vyacheslav TIMCHENKO

Romana TOMC*

Lord John E. TOMLINSON

Mihai TUDOSE/Daniel Florea

Ahmet Kutalmiş TÜRKEŞ

Tuğrul TÜRKEŞ*

Theodora TZAKRI

Konstantinos TZAVARAS

Tomáš ÚLEHLA*

Ilyas UMAKHANOV/Alexander Ter-Avanesov

Petrit VASILI

Volodymyr VECHERKO/Larysa Melnychuk

Mark VERHEIJEN/Marjolein Faber-Van De Klashorst

Anne-Mari VIROLAINEN

Vladimir VORONIN*

Klaas de VRIES

Nataša VUČKOVIĆ

Zoran VUKČEVIĆ

Draginja VUKSANOVIĆ

Piotr WACH

Johann WADEPHUL

Robert WALTER

Dame Angela WATKINSON*

Katrin WERNER

Karin S. WOLDSETH*

Gisela WURM*

Barbara ŽGAJNER TAVŠ*

Emanuelis ZINGERIS*

Guennady ZIUGANOV

Naira ZOHRABYAN

Levon ZOURABIAN

Vacant Seat, Cyprus*

ALSO PRESENT

Representatives and Substitutes not authorised to vote

Kerstin LUNDGREN

Martina SCHENK

Eduard SHALSI

Spyridon TALIADOUROS

Observers

Eloy CANTU SEGOVIA

Ernesto GÁNDARA CAMOU

Javier LOZANO ALARCÓN

Michel RIVARD

Miguel ROMO MEDINA

Partners for Democracy

Najat AL-ASTAL

Mohammed AMEUR

Mohammed Mehdi BENSAID

Nezha EL OUAFI

Omar HEJIRA

Bernard SABELLA

Mohamed YATIM

Appendix II

Representatives or Substitutes who took part in the ballot for the election of a judge to the European Court of Human Rights in respect of Romania.

Jean-Charles ALLAVENA/Christian Barilaro

Paride ANDREOLI

Volodymyr ARIEV

Daniel BACQUELAINE/Dirk Van Der Maelen

Deniz BAYKAL

José María BENEYTO

Levan BERDZENISHVILI/Tinatin Khidasheli

Sali BERISHA/Oerd Bylykbashi

Gülsün BİLGEHAN

Brian BINLEY

Márton BRAUN

Gerold BÜCHEL/Rainer Gopp

André BUGNON

Mikael CEDERBRATT

Otto CHALOUPKA/Pavel Lebeda

Irakli CHIKOVANI

Tudor-Alexandru CHIUARIU/Viorel Riceard Badea

Christopher CHOPE

Lise CHRISTOFFERSEN

Boriss CILEVIČS

Milena DAMYANOVA

Joseph DEBONO GRECH

Arcadio DÍAZ TEJERA

Şaban DİŞLİ

Aleksandra DJUROVIĆ

Karl DONABAUER/Edgar Mayer

Josette DURRIEU

Tülin ERKAL KARA

Joseph FENECH ADAMI

Cătălin Daniel FENECHIU

Doris FIALA/Maximilian Reimann

Daniela FILIPIOVÁ

Axel E. FISCHER

Gvozden Srećko FLEGO

Bernard FOURNIER

Erich Georg FRITZ

Martin FRONC

Tamás GAUDI NAGY

Alina Ştefania GORGHIU

Andreas GROSS

Antonio GUTIÉRREZ

Ana GUŢU

Sabir HAJIYEV

Norbert HAUPERT

Andres HERKEL

Jim HOOD

Joachim HÖRSTER

Anette HÜBINGER

Andrej HUNKO

Ali HUSEYNLI

Rafael HUSEYNOV/Sahiba Gafarova

Florin IORDACHE

Igor IVANOVSKI

Denis JACQUAT/Frédéric Reiss

Stella JANTUAN

Ramón JÁUREGUI

Čedomir JOVANOVIĆ/Svetislava Bulajić

Marietta KARAMANLI/Maryvonne Blondin

Serhii KIVALOV

Haluk KOÇ

Attila KORODI

Tiny KOX

Václav KUBATA/Miroslav Krejča

Jean-Yves LE DÉAUT

Valentina LESKAJ

Terry LEYDEN

Inese LĪBIŅA-EGNERE/Jānis Dombrava

George LOUKAIDES

Philippe MAHOUX

Thierry MARIANI

Meritxell MATEU PI

Frano MATUŠIĆ

Liliane MAURY PASQUIER

Ivan MELNIKOV

Nursuna MEMECAN

Jean-Claude MIGNON/Marie-Jo Zimmermann

Djordje MILIĆEVIĆ/Vesna Marjanović

Igor MOROZOV

João Bosco MOTA AMARAL

Lydia MUTSCH/Fernand Boden

Marian NEACŞU

Baroness Emma NICHOLSON/Charles Kennedy

Judith OEHRI

Carina OHLSSON

Lesia OROBETS

Sandra OSBORNE/Michael Connarty

Eva PARERA/Jordi Xuclà

Ivan POPESCU

Marietta de POURBAIX-LUNDIN

Cezar Florin PREDA

Jakob PRESEČNIK

René ROUQUET/Pascale Crozon

Pavlo RYABIKIN

Rovshan RZAYEV/Mustafa Dzhemiliev

Kimmo SASI

Deborah SCHEMBRI

Stefan SCHENNACH

Marina SCHUSTER

Urs SCHWALLER

Senad ŠEPIĆ/Ismeta Dervoz

Samad SEYIDOV

Oleksandr SHEVCHENKO

Serhiy SOBOLEV

Lorella STEFANELLI

Yanaki STOILOV

Ionuţ-Marian STROE

Valeriy SUDARENKOV

Björn von SYDOW

Chiora TAKTAKISHVILI

Lord John E. TOMLINSON

Mihai TUDOSE/Daniel Florea

Ahmet Kutalmiş TÜRKEŞ

Petrit VASILI

Volodymyr VECHERKO/Larysa Melnychuk

Klaas de VRIES

Nataša VUČKOVIĆ

Zoran VUKČEVIĆ

Draginja VUKSANOVIĆ

Piotr WACH

Robert WALTER

Katrin WERNER