The Committee on Economic and Monetary Affairs adopted
the own-initiative report by Pervenche BERÈS (S&D, FR) on
the review of the economic governance framework: stocktaking and
challenges.
Whilst welcoming the Commission
Communication of 28 November 2014 on the economic governance
review, the committee stressed the fact that the current
economic governance framework needs to be implemented and where
necessary improved to: (i) deliver fiscal stability, to favour
a proper debate on the overall assessment of the euro area as a
whole allowing growth friendly fiscal responsibility; (ii) improve
economic convergence perspective of the euro area; (iii) address on
an equal footing Member States' different economic and fiscal
situations.
Members insisted that the current framework is complex
and it suffers from a lack of ownership at national level
and limited attention to the international economic perspective and
appropriate democratic accountability mechanism. They
underlined the importance of simple and transparent
procedures for economic governance.
Best application of flexibility within the existing
rules: the report welcomed the interpretative
communication on flexibility within the existing rules of the
Stability and Growth Pact (SGP). Members supported:
- all the incentives proposed by the European
Commission to finance the new European
Fund for Strategic Investments (EFSI), mainly by making
national contributions to the fund fiscally neutral as regards
to the attainment of the MTO and to the required fiscal adjustment
effort without modifying it in the preventive or the corrective arm
of the Stability and Growth Pact;
- the Commission's intention to refrain from
launching an Excessive Deficit Procedure (EDP) if, only because
of the additional contribution to the EFSI, a Member State deficit
goes slightly and temporarily beyond the 3% deficit
limit;
- that the Commission communication aims at
clarifying the scope of the investment clause, allowing for
a certain degree of temporary flexibility in the preventive arm of
the SGP, in the form of a temporary deviation from the Medium Term
Objective (MTO), provided the deviation does not lead to an excess
over the 3% deficit reference value and an appropriate safety
margin, to accommodate investment programmes by the Member
States.
Closer coordination, economic convergence and
streamlining of the European Semester: the report urged the Commission to fully apply the
SGP and ensure its fair implementation. Members supported the
Commission three-pillar strategy (growth-enhancing
investments, fiscal consolidation and structural reforms),
presented in the AGS 2015 and asked to make it more concrete
under the overall assessment of the budgetary situation and
prospects in the euro area and in the Country Specific
Recommendations.
Members made the following recommendations:
- streamline and reinforce the European
Semester within the current
legislative framework;
- the Commission and the Council should better
articulate the fiscal and macroeconomic frameworks to allow for
earlier and more consistent debate among all stakeholders taking
into account: (i) the European interests served by these
frameworks, (ii) the need to increase convergence between euro area
Member States, (iii) deliberation by national parliaments and the
role of social partners or of local authorities regarding the
ownership of sustainable and socially balanced structural
reforms;
- the Annual Growth Survey (AGS) as well as the
country-specific recommendations (CSR) must be better
implemented and take into account the
assessment of the budgetary situation and prospects both in the
euro area as a whole and in the individual Member
States;
- the Country Specific Recommendations (CSRs) should be,
where relevant, better coordinated with the Excessive
Deficit Procedure (EDP) recommendations so as to ensure
consistency;
- the elaboration, follow-up, support and
monitoring of Country Specific Recommendations should be
enhanced;
- the Commission should take account, in its analyses
all important factors, including real growth, inflation, long
term public investment and unemployment rates when evaluating the
economic and fiscal situations of Member States.
Democratic accountability and challenges
ahead: Members stressed that a
major role must be played by institutions subject to democratic
accountability. They recalled the European Parliament's
resolutions specifying that the creation of the European Stability
Mechanism (ESM) and of the Treaty on Stability, Coordination and
Governance ('Fiscal Compact') outside of the structure of the
institutions of the Union represents a setback to the
political integration of the Union.
The stakeholders are invited to take into account the
foreseeable future enlargement of the euro area and to explore all
options to deepen and strengthen the EMU, such
as:
- enhanced democratic accountability
mechanisms at both the EU and
national levels, whereby responsibilities must be assumed at the
level where decisions are taken and based on the adoption of
convergence guidelines under co-decision;
- formalising the scrutiny role of the European
Parliament in the European Semester in an Inter-Institutional
Agreement;
- ensuring that all euro area National
Parliaments follow each step of the European Semester
process;
- a social dimension aimed at preserving Europe's
social market economy, respecting the right to collective
bargaining;
- a euro area fiscal capacity based on specific
own-resources which should, in the framework of the Union budget
with European parliamentary control, assist Member States in the
implementation of the agreed structural reforms;
- increasing the resilience of the EMU to face
economic shocks and emergencies directly connected to the monetary
union;
- the inclusion of the European Stability
Mechanism and the Treaty on Stability, Coordination and
Governance (TSCG) in Union law.
Members recalled their request to develop options for
a new legal framework for future macroeconomic adjustment
programmes, replacing the Troika, in order to increase the
transparency and ownership of these programmes and ensure that all
EU decisions are, where possible, taken under the Community
method.