A wave of privatization seized also the social safety systems. Throughout Europe company pension funds and private pensions are propagated as good alternatives to old-age pensions under state-law, though analysts expect great financial problems arising here. The risks and disadvantages of private provisions though they become all the more evident, seem not to hinder the reform of pension systems in all EU-member states to progress in the direction of "more private, less state".

Quite contrary to telecommunication, the sector in the EU that, starting from 1998, has been completely liberalized and, to a good deal, also privatized, the postal services remain not only state-owned in most EU countries but, moreover, dispose of different kinds of service monopolies in many cases. The year 2003 marks a change, because starting as of 2003, a reduction of the mailings’ weight limit line has been introduced, above which line free market competition had to be granted. Further steps (2006 respectively 2009) have been fixed already. In the run-up to keep this liberalization deadline, the state-owned postal services have taken to a variety of measures, not all of them equally successful, in order to keep their competitive position.

During the last decades one could notice a real boom for private security services coming into existence in the EU-countries. Experts see the reason for this in a higher need for security spreading among private persons and companies. They take America as an example and are no longer prepared to entrust the efficient dealing with a frightening situation to the police force only but hire their private security force. And, it is not only companies but also public institutions that do make extensive use of these services. Several countries went so far as to transfer on a large scale once traditional police tasks on to private security services.

Since the time when the report on electric energy appeared, one and a half years ago in June 2002, a good deal of change has taken place in this field, which was the reason for our collaborator, Mr. Bela M. Hollos, to undertake the report a complete revision. What we experience today is the fact that privatization in the electric energy sector had, for the sake of guarding consumer interests, to bring about stricter market regulations than ever before. In technical respect privatized enterprises show no better performance than state-owned and in terms of economy they perform only slightly better, saving, as it is, mainly on the staff. Starting from the 90-ies, jobs of about 250,000 got lost in the EU-electric-energy-sector. In spite of this, the prices have gone up in 9 EU-countries out of 15 during the last three years. The prices for electric energy supply are much cheaper for industrial than for private consumers. The gap that opens between these two prices becomes all the more evident.

The European telecommunication market is largely privatized and liberalized now. The European old and new telecommunication and mobile phone markets are, however, still controlled by the former state-owned telecom-enterprises, sometimes even by means of state funding. Through the liberalization consumer prices were reduced, though, but jobs got lost up to an amount of about 250,000. As many jobs were created anew within the fields of mobile phone and internet as well as within new company foundations or mergers brought about by the former state-owned telecom-companies.

With regard to water supply and the disposal of sewage we notice two different approaches in Europe. A strong water-management characterizes Western Europe (Portugal, Spain), where the water sector rests largely (France) or exclusively (Great Britain) in the hands of private companies with sometimes international background. In the Centre or North of Europe this sector is mostly state-owned. Whilst in countries like the Scandinavian, Germany, Austria, Italy, water-management remains a task of the local authorities, we see in the Netherlands a highly centralized public but nevertheless successful management at work. EU legislation does not request a liberalization or privatization of water supply, but water-management looks very attractive to private enterprises, especially in countries like Austria where water flows in abundance. But already existing examples of privatized water-management during the last years uncover enormous disadvantages for the consumers. This is true for Great Britain, where the price for water on an average is three times the price in Sweden, a country which works on an exclusively local water-supply basis. In addition, the quality of supply has considerably diminished.

Tendencies to liberalize the accommodation sector lead to a de-regulation of rent pricing, and to stronger investment in rented flats in expectation of the respective market reaction due to a reduced supply. There has been lasting for some years the tendency in most of the EU countries to a state-retreat from the accommodation sector. In some countries the sale of former local government or state-owned rent units has become an instrument for budget consolidation. The purchasers are former tenants, housing associations or real estate companies.

The process of privatization and liberalization of the public services in Latvia has progressed in quite different ways. Hardly any progress was made in the sectors education, exempting university education, postal services, water supply and sewage disposal. First steps have been taken in the sectors waste disposal and pensions. Good progress has been made in the sectors energy, health service, culture and security. More or less already fully privatized are the media, telecommunication and accommodation.

During its preparation period for joining the EU, Poland took to measures for the liberalization of the sectors telecommunication, post, energy, railways. Especially strong are the tendencies now prevailing in the country to privatize education, bad results have been experienced by Poland when the state retreated from the health and culture sectors and in a complete disaster ended attempts to have motorway construction privatized. Thanks to experiences gained, water supply and sewage disposal remained largely the task of local authorities.

Slovenia normally has the reputation among the EU-new-member states of an economically successful country and the most progressive of all. This hits the point. It is therefore remarkable to notice that in Slovenia the share of public services is still high and that alongside on the market work private enterprises of high efficiency and an ever growing output. Slovenia proves the fact that privatization is not necessarily a prerequisite of economic success.

After the radical political change of 1989, the Czech Republic like other countries sold into private her larger share in former state property holdings in the industrial, banking, accommodation and media sectors during a number of privatization campaigns. The zeal for privatization has significantly cooled down by now. Several branches within the public services sector had been opened to private co-ownership for the benefit of drawing into the country foreign capital as well as know-how (this regards telecommunication, the energy sector and public environment services), remain, however, largely public property till now. For other branches, as post or transport, this process is still ahead. Financial problems characterize the sectors education and culture, health service and pensions, which are still dominated by public control.

The document outlines the process of privatizing and liberalizing public services in Cyprus. This Mediterranean island disposes of the highest pro-capita income of all 10 EU-new-member-states. The country is dominant in the production of solar energy, disposes of an extensive system of municipal housing units, the number of students is above average, the number of cars available ranks among the highest worldwide.

This paper represents a summary of the essential results of a sequence of studies on “Privatization and Liberalization of the Services in the EU”, which had been compiled by the “Austrian Society of Policy Counselling and Development” (ÖGPP) during 2002 through 2004. This sequence of studies comprises a total of 25 individual reports, 600 pages in total. It consists of 15 partial reports on 15 important public service branches within EU-15 (the Railways and public local passenger transport, telecommunication, postal service, state-owned radio broadcasting and television, education, culture, drinking-water and sewage, waste industry, electric power, gas, health service, security, accommodation, pensions, undertakers) as well as of 10 additional partial reports on the branches mentioned within the 10 EU-new-member states. By this sequence of studies the interested reader receives not only an unparalleled but also a largely complete survey on privatization and liberalization of public services in all the 25 EU-member states comprising the last decades.

Opinions held on the subject are contradictory. There are people saying: The Directive would indeed mean the final realisation of the Single European Market. It would be the key to open the market for an unhampered and Europe-wide provision of services. It would gradually phase out bureaucracy. Hundreds of thousands additional jobs would get created.
Protected sectors, such as public services touching on human existence would remain exempted. Austria would be one of the main beneficiaries. But there are others saying: The Directive would mean the most radical to date overall attack on the EU member states’ welfare systems. It would by no means mean the realisation of the internal market but the reduction of democracy. The consequences would be felt as massive dumping in wages and social welfare benefits and, in addition, the abandonment of the idea of human existence being provided for by public services. European consumers and environment would greatly remain unprotected because of either non-existence of or evading existing standards. Another consequence would be an enormous legal uncertainty. The “Proposal for a Directive of the European Parliament and of the Council on the services in the internal market” is well charged with emotion, for it could be apt to fundamentally change the lives of many of us living in Europe.  Now, what we did was to compile all the essentials on the Directive into a clear, easy and comprehensive summary, just now at your disposal.