MOTION FOR A RESOLUTION on the need for strengthened economic governance

14.6.2010

to wind up the debate on statements by the Council and Commission
pursuant to Rule 110(2) of the Rules of Procedure

Guy Verhofstadt, Lena Ek on behalf of the ALDE Group

See also joint motion for a resolution RC-B7-0349/2010

B7‑0355/2010

European Parliament resolution on the need for strengthened economic governance

The European Parliament,

–   having regard to the informal European Council of 11 February 2010,

–   having regard to the public consultation on EU 2020 launched by the Commission, and its outcome (SEC(2010)116),

–   having regard to the Commission’s evaluation of the Lisbon Strategy (SEC(2010)114),

–   having regard to the European Council document entitled ‘Seven steps to deliver on the European strategy for growth and jobs’,

–   having regard to the European Parliament resolution of 10 March 2010 on EU 2020,

–   having regard to Rule 110(2) of its Rules of Procedure,

A. whereas the EU 2020 strategy should promote economic growth and create jobs, whereas the 4% drop in GDP, falling industrial production and a total of more than 23 million unemployed women and men represent a social and economic challenge,

B.  whereas the current financial crises in certain Member States of the European Union would not have occurred if Member States had adhered to the rules of the Stability and Growth Pact,

C. whereas Member States should increase their economic performance by introducing structural reforms in order to reduce public expenditure, decrease bureaucracy, increase the self-responsibility of citizens, encourage entrepreneurship and innovation, make legislation more SME-friendly and provide people with the opportunity to maximise their potential instead of being dependent on social welfare,

European Financial Stabilisation Mechanism to guarantee stability of the eurozone important first step

 

1.  Considers that the agreement reached on the 9th of May to establish a European Financial Stabilisation Mechanism to help both eurozone and non-eurozone countries in financial difficulties was a crucial moment in European history, but regrets that European policymakers have lost months and billions of euros as a result of in not taking decisive action earlier;

2.  Considers it to be an important first step to give the European Union a robust and sustainable framework for monetary policy; believes that the success of this programme depends critically on whether the Member States in financial difficulties can reform their labour markets, sort out their banking sectors, improve productivity and speed up fiscal adjustments;

3.  Reminds the Commission and the Member States that the European Parliament will have to give its approval in case the Commission and Council want to raise the bailout fund on the international capital markets;

4.  Stresses that the recent events show that the eurozone is in need of bolder economic governance; stresses that a monetary pillar without a social-economic pillar is doomed to fail;

European Union must be better prepared for future crises

 

5.  Welcomes the Commission proposals for strengthening the management of the eurozone in the medium and long-term to avoid any repetition of the current currency crisis;

6.  Urges the Commission to include an enforced sanctioning mechanism (e.g. naming and shaming, withdrawing of voting power, reduced subsidies from structural funds and financial penalties) within the eurozone in order to force Member States to adhere to the rules of the Stability and Growth Pact;

7.  Calls for the creation of a ‘European Monetary Fund,’ to which eurozone countries would contribute according to the size of their GDP and through fines according to their excess debt and deficit; any Member State could draw from EMF funds up to the amount it has deposited in the past; should a country, however, need additional resources or guarantees it would have to accept a tailor-made reform program, which the European Commission would supervise;

8.  Takes the view that the eurozone needs a common euro-bond market (EBM) to reduce the yield spreads between benchmark bonds and simplify the way in which Member States access funds; stresses the need for many countries to put their fiscal houses in order and reduce significantly their deficit and debt levels;

9.  Stresses that the powers of EUROSTAT should be enhanced; considers that open and transparent statistical information should be a precondition for accessing structural funds;

10. Stresses the need for a European supervisor for micro- and macro-prudential supervision ensuring effective supervision;

11. Calls on the European Commission to simplify the funds allocation and make them available in a shorter time in order to better tackle the crisis;

The governance structure of the Europe 2020 strategy remains too weak

12. Believes that the current Europe 2020 strategy should be bolder to ensure it will not have the same fate as the failed Lisbon Strategy that failed due to a weak governance structure, a lack of accountability and a lack of focus and transparency;

13. Therefore deeply deplores that the Commission and the Council have not strengthened the governance structure of the Europe 2020 strategy, despite the strong demand from the European Parliament in its resolution of 10 March 2010 on Europe 2020;

 

14. Stresses again that the open method of coordination in the field of economic policy has failed and should be replaced by binding measures;

15. Takes the view that the Member States, in close cooperation with the European Commission, should draft national action plans respecting a European code of convergence with maximum and minimum values to be applied to certain macro-economic aspects of their economies; this Code of Convergence is to be drafted by the European Commission and adopted by the European Council;

16. Urges the European Commission to use its right of initiative to come forward with an economic strategy for economic recovery based primarily on EU instruments and not solely on intergovernmental initiatives;

17. Believes that real economic governance implies giving to the Commission a proper and stronger responsibility of management, enabling it to use existing tools as well as tools newly provided for by the Lisbon Treaty such as Articles 121, 122, 136, 172, 173 and 194 which confer to the Commission the task of coordinating reform plans, actions as well as establishing a common strategy;

18. Urges the European Council and the Commission to establish a ‘carrot and stick’ approach and use compliance mechanisms in the framework of Article 136 of the Treaty, such as economic incentives, (e.g. as extra EU funds), as well as sanctions aiming at supporting an enhanced EU economic governance and more specifically enhanced governance under the EU 2020 strategy;

The European budget does not reflect the same level of ambition as displayed in the Commission Communication on Europe 2020

19. Stresses that the European Parliament will not endorse the Draft Budget 2011 as long as it does not reflect the level of ambition as put forward in the Europe 2020 strategy; deplores the fact that the flagship programmes of the Europe 2020 strategy are not provided with sufficient funding in the Draft Budget 2011; calls on the European Commission to clarify the relation between the budget lines and the related EU 2020 strategy specific objectives;

20. Calls on the European Commission to come forward with an ambitious overhaul of the European budget in the revision of the multiannual financial framework in June to raise the level of ambition to make the Europe 2020 strategy a success;

The European Parliament will use all tools available to strengthen the Europe 2020 strategy

21. Deplores that both the European Commission and the European Council have not shown more willingness to cooperate closer with the European Parliament to make the Europe 2020 strategy a success;

22. Stresses that Parliament will take its decision on the Employment Guidelines following its receipt of a satisfactory response regarding the governance structure and budgetary framework of the Europe 2020 strategy;

23. Stresses that the annual policy recommendations and warnings from the Commission regarding compliance of the Member States with the Europe 2020 objectives should be the basis for European Council decisions; these reports should be discussed in the European Parliament before the European Council discussions;

24. Takes the view that the Broad Economic Policy Guidelines (BEPGs) and the country specific recommendations will need to be detailed enough to have a real effect;

25. Expects Council and Commission to consult Parliament on the Broad Economic Policy Guidelines (BEPGs); believes that the BEPGs should focus on policy recommendations tackling both macro and microeconomic developments in the Union at large and the individual Member States and that special attention should be given to growth enhancing structural reforms over the medium and long-term;

26. Stresses the importance of a stronger link between the instruments of the Stability and Growth Pact and the National Reform Programmes by presenting them in coherent way time-wise, including better comparability of national budgets as regards spending in different categories;

27. Instructs its President to forward this resolution to the European Council and European Commission.