23 October 2013

Plenary Session: EU economic and budget coordination must improve, say MEPs

The resolution notes that for 2012 only 15 per cent of EU recommendations to governments were significantly implemented.

The warnings and requests are set out in Parliament's annual resolution on the latest developments in the European Semester, the process whereby EU Member States coordinate their budgetary and economic policies. Drafted by Elisa Ferreira (S&D, PT), the resolution calls for stricter criteria to ensure that economies converge and underlined once more that democratic accountability of the process is not up to scratch. 

More on economic convergence

More legislation is urgently needed to achieve genuine convergence, inter alia by creating a Competitiveness and Convergence Instrument which would supply EU countries with funds to cushion the short-term negative effects of economic reforms, says the text. The "surplus" countries should make more efforts to beat the crisis and not leave that solely up to those in fiscal difficulties, it adds. Finally, the European Commission must take a more lenient view of non-recurrent public investment with a proven track record of ultimately improving a country's budgetary situation, such as investment in necessary infrastructure or education, MEPs. 

More on employment and evaluating impact of reforms

Unemployment must be tackled more directly, by prioritising investments in education, and ensuring better financing of small firms, particularly in the outermost regions of the EU. The Commission is also asked to examine the possibilities for a minimum unemployment allowance in the eurozone. Finally, the Commission is urged to assess the impact of the budgetary reform recommendations it makes to countries. 

More accountability and transparency

The resolution calls for more transparency and accountability in the work of the European Stability Mechanism and the Eurogroup, as well as in the operation of financial assistance programmes. For their part, Member States need to improve "ownership" further by involving national parliaments, social partners and civil society more extensively, particularly in national economic reform programmes, it adds. Finally, it also advocates "reshaping" the Troika (Commission, ECB, IMF) and calls on it to overhaul its communication strategy, which has "repeatedly proved to be a disaster". 

Next steps

The resolution will feed into the work to be done in the coming months on economic and budgetary coordination, starting with the Commission's November Annual Growth Survey which will kick off the 2014 Semester.

Press release

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