European Semester economic policy coordination needs many fixes, not least to take proper account of growth, employment, investment and social concerns, warned the Economic and Monetary Affairs Committee in a resolution voted on Monday. MEPs also called for more rules to ensure economic convergence and again underlined that democratic accountability and ownership must be improved.
The warnings and requests are set out in the committee'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) and approved by 30 votes to 2, the resolution welcomes the fact that some concerns previously raised by Parliament have been addressed but notes that there is still ample room for improvement.
More on economic convergence
More legislative proposals are urgently needed to achieve genuine convergence, inter alia by creating a Competitiveness and Convergence Instrument and strengthening economic policy coordination, says the text. To this end, more effort is also needed from "surplus" countries, not just those in fiscal difficulties, it adds. Finally, MEPs encourage the Commission to take a more lenient view of non-recurrent, public investment programmes with a proven track record of ultimately improving a country's budgetary situation.
More on employment and an EMU with a social dimension
The resolution urges the Commission to do much more to build social concerns into the Semester and, more broadly, into the Economic and Monetary Union. It calls for legislative proposals to give EMU a social pillar and set up a "social pact for Europe", given that some countries' social welfare mechanisms have been greatly eroded by budget cuts. Finally, the Commission is urged to assess the social impact of its reform recommendations.
Unemployment must also be tackled more directly and urgently, by better integrating measures to reduce it into other economic policies, prioritising investments in education, and ensuring better financing of the real economy and small firms, particularly in the EU's periphery.
More for accountability, ownership and transparency
The Commission should also develop ways to increase the visibility of the Semester process, says the text. With its help, member states should step up the involvement of national parliaments, social partners and civil society, particularly in developing, discussing, monitoring and evaluating national reform programmes, it adds.
Finally the resolution calls for more transparency about the work of the European Stability Mechanism and the Eurogroup, as well as financial assistance programmes. It also urges the Troika (Commission, ECB, IMF) to revise its communication strategy, which has "repeatedly proved to be a disaster".
The resolution will be put to a vote by the whole house towards the end of October. It will provide Parliament's input for 2014 coordination process, which the Commission is to launch in November.