Mandelson calls for "new European convergence"

Peter Mandelson, the incoming European Commissioner for Trade, has called for a "new European convergence" that combines the best of British economic flexibility with continental welfare state and scientific research.

Speaking today in Birmingham Mr Mandelson said the modern European model should combine economic dynamism with the greater social equality seen in countries such as Sweden and Denmark.

He said: "What we need is a new European convergence - British-style economic openness and market flexibility with continental-style investment in social and economic infrastructure, scientific research and development, and public services."

Mr Mandelson added the Barroso Commission had set itself the task of being remembered as the "Growth and Jobs Commission".

The former Hartlepool MP was back in the UK for the CBI annual conference, which will also hear today from BBC chairman Michael Grade.

Chancellor Gordon Brown and his French counterpart Nicolas Sarkozy head the list of speakers on Tuesday.

Mr Mandelson told the conference that the EU had many strengths but would remain flawed as long as growth was "anaemic" and millions were unemployed or inactive. For that reason, it needed an injection of "American-style" dynamism.

He warned that Europe risked on the one hand being "outsmarted and outgunned" on high-level research and development by American companies, and pushed out of manufacturing by growing economies such as China on the other.

But he maintained that European heads of government had been "galvanised" by the recent Kok report showing they were failing to make enough progress on the Lisbon agenda.

He suggested a single minister in each member state should co-ordinate strategy on the Lisbon agenda, and that heads of government needed to make the agenda an "explicit feature" of their domestic reforms.

The Commission would be trying to reinvigorate the drive for open markets, he added, robustly tackling abuses of market dominance and making it easier for new entries by dynamic firms.

Mr Mandelson also gave his support to the Services Directive, which would make it easier for service businesses to set up in different member states.

And he promised to act on regulation, saying he hoped all new legislative proposals would be subjected to a "searching" growth and jobs test.

"There is growing awareness of the counterproductive effects legislation can have and the need to watch out for these effects," he said.

Ways of levering in much more private sector research and development funding were needed, he said, adding that no government should be the "principal driver" of R&D.