Barroso's party political broadcast fails to win the day

EUROPEAN DIARY: Spain's vote in favour of the EU constitution helped to cheer up the European Commission on a cold, grey Monday morning in Brussels, prompting Mr Jose Manuel Barroso to declare that Spaniards had embraced a truly European consciousness.

"The Spanish people have sent a strong signal to their fellow citizens who will give their view on the constitution in the coming months," he said.

The commission president will have been less pleased by the outcome of Sunday's election in his native Portugal, where the opposition Socialists won a landslide victory. The result came despite Mr Barroso's last-minute television appeal to voters to support his former party, the conservative Social Democrats.

Mr Barroso's 36-second party political broadcast outraged Socialists in the European Parliament, who called for an overhaul of the code of conduct governing commissioners' involvement in national election campaigns. They warned the commission president that he will need support across the political spectrum if his commission is to succeed in implementing its plans over the next five years.

In Germany, the opposition Christian Democrats won a surprise victory on Sunday in a state election in Schleswig-Holstein, a development which might be expected to please the conservative Mr Barroso. In fact, the German election result could cause the commission president more trouble than the widely-expected Portuguese one.

Mr Barroso has identified the Lisbon Agenda, an economic reform programme, as the overriding priority of his five years in Brussels.

Most measures envisaged in the programme are the responsibility of national governments and the commission has little power to force governments to fall into line with the plan.

A majority of the voters who deserted Chancellor Gerhard Schröder's Social Democrats on Sunday identified rising unemployment as their main concern. Mr Schröder's government has introduced unpopular reforms to his country's health and social welfare systems which have helped to persuade some foreign investors that Germany is once again an attractive country for business.

Sunday's result could reinforce the chancellor's anxiety that further reforms might not only endanger his chances of winning a third term in office next year but could impede a return of the consumer confidence required to boost Germany's economic growth.

Mr Schröder faces a more important electoral test in May, when a coalition of Social Democrats and Greens will seek to retain power in Germany's most populous state, North Rhine Westphalia.

Germany's reluctance to unsettle the public with further reforms is shared in France, where voters face a referendum on the EU constitution before the summer. Italy, the third-largest economy in the euro zone, is also wary of reforms in advance of next year's general election.

Concern is growing throughout Europe at the possible implications of the Services Directive, a proposal to liberalise the European market in services ranging from accountancy to nursing care. The directive is the most important part of the economic reform agenda which is directly led by the commission, and winning support for it from the European Parliament and the 25 member-states is the biggest challenge facing the Internal Market Commissioner, Mr Charlie McCreevy.

MEPs will vote on the directive in May or June, probably after proposing far-reaching amendments aimed at protecting the rights of workers and consumers from its effects.

Mr McCreevy is expected to wait until the vote in the European Parliament before proposing changes of his own, but he has already indicated that he regards winning political support for liberalising the services market as being more important than preserving the directive's ideological purity.

Mr Barroso's supporters in the commission claim that his mishandling of the Rocco Buttiglione affair has caused the media to underestimate him. They point out that Mr Barroso has asserted his authority over the commission and that all his colleagues in the Berlaymont share his commitment to making the Lisbon Agenda a success.

There is no doubt that Mr Barroso and his inner circle have been effective in putting their stamp on all major commission policies. This success owes something to the fact that only three commissioners - Germany's Mr Guenther Verheugen, Britain's Mr Peter Mandelson and Lithuania's Ms Dalia Grybauskaité - have so far made much impact beyond their own portfolios.

Mr Barroso has yet to show, however, that he has fully grasped the most important lesson of the Buttiglione affair - that he needs to move beyond his natural supporters on the centre-right if he is to succeed. Sunday's election results may, in their different ways, help him to make the necessary political adjustment.