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30-01-2013

Committees focus on European Semester

The European Semester was the focus of work for the committees on Economic and Monetary Affairs, Budgets and Employment on Tuesday, as MEPs met their national counterparts to discuss economic coordination work going on at EU level and how parliaments can better hold the various decision makers to account.


Democratic deficit and austerity

The new economic governance arrangements being introduced, inter alia through the European Semester, directly affect every aspect of national economic policy, and hence must be subject to stronger democratic control, acknowledged MEPs and MPs in the Economic and Monetary Affairs Committee debate. Without this control, citizens may eventually just stop accepting reform recommendations, they warned.  A paradigm shift towards stronger economic governance necessitates a similar shift in the way parliaments are involved and work together, noted one MP.

However, not all participants agreed that such changes on the EU landscape require moves towards a generally more integrated union.

There was still less agreement on whether policy makers should move away from prescribing austerity as the solution to the crisis. Many on the centre left argued that austerity was having exactly the opposite effect to that intended. Others countered that reforms are hard but inevitable, and are producing positive results.


EU budget

European Parliament Budgets Committee Chair Alain Lamassoure (EPP, FR), called for a proper discussion of what can be expected from the EU budget.

"Ireland's population makes up less than 1% of the EU total, and Greece's GNP is less than 2% of that of the EU as a whole. Yet their budgetary problems have kept us busy for a long time", he said, pointing out that EU member states' national budgets are interdependent.

He also called for a genuine EU "own resources" system to make the Union less dependent upon contributions from national budgets (which currently account for 85%).

The EU budget should not be seen as a  "burden" on national budgets, but "a means to do things more cheaply by doing them together", said MEP Anne Jensen (ALDE, DK), who will steer next year's EU budget through Parliament."In Denmark we save money on the diplomatic service now that we have the European External Action Service", she explained.

Ms Jensen criticised the compromise proposal circulating among member states for the EU's long-term budget (2014-2020). "This implies that we would have the same budget in 2020 as we had in 2008", she said. Like Mr Lamassoure, she made the case for a budget that is sufficiently flexible to deal with changing circumstances.

Youth unemployment and social impact of fiscal consolidation

Youth guarantee schemes, to ensure that no young person in the EU goes without a job, education or training for more than four months, are one way to enable young people to gain access to employment, said MEPs and MPs. Fostering entrepreneurship, measures to ensure that youngsters do not drop out of school, better matching education and training to employers' needs and labour market reforms were also proposed by MEPs and MPs as ways to reduce youth unemployment and combat the risk of "a lost generation". Youth unemployment has reached an unprecedented peak of 23.7% in the EU.

MEPs and MPs also discussed the social impact of austerity measures. "This issue is important at a time when several economists have acknowledged that the negative multiplier effects of austerity measures on employment and social conditions have been underestimated", said Employment Committee Chair Pervenche Berès (S&D, FR). "It's now time to implement proportionate and differentiated fiscal consolidation to avoid negative effects on growth and employment", said Veronica Lope Fontagné (EPP, ES), rapporteur on the Employment aspects of the Annual Growth Survey 2013.

Website of Committee on Economic and Monetary Affairs
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Website of the Committee on Budgets
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Website of the Committee on Employment and Social Affairs