EU countries need to continue to cut their budgets, even though the lack of investment is hampering growth, said the European Commission in its Annual Growth Survey for this year. The publication of the document last December started the European Semester, the process of the EU coordinating economic policies for the member states. MEPs will meet their colleagues from the national parliaments on 3 and 4 February to discuss what needs to be done to get the EU out of the crisis.
European New Deal
European Parliamentary Week, as this annual meeting is called, aims to foster debate between the European Parliament and the national parliaments on the EU's economic priorities for next year.
Participants, including EP President Martin Schulz and Vice-President Olli Rehn, will focus on an investment package announced by the Commission that aims to boost growth and create new jobs. They will also debate establishing a social dimension for the EU's economic and monetary union, as currently it focusses on budget discipline.
Need for greater democratic control
Member states can be asked to make budget cuts in sensitive areas such as health and public investment as well as embark on pension reforms as a result of the European Semester. This is why the European Parliament has insisted on numerous occasions that the process needs greater democratic legitimacy.
Some MEPs have criticised the current decision-making process as not being democratic enough as existing rules mandate that governments send their budgets for approval to the Commission before national parliamentsare able to vote on them.
Member states have to submit their economic and budget plans to the Commission, which will then provide each country with recommendations in June, setting out what budget cuts and structural reforms are needed. The Council of the EU will then vote on the recommendations, after which member states have until the end of the year to amend their budget plans.
Austerity vs growth
Further complicating matters is the divide between those who argue for the continuation of austerity policies and those that blame cuts in public spending for weak growth and increasing unemployment.