Verbatim report of proceedings

Wednesday, 15 February 2012 - Strasbourg

12. Economic crisis, growth and employment (debate)

  President. – The next item is the statement by Professor Monti, Prime Minister of the Italian Republic, on the economic crisis, growth and employment (2012/2538(RSP)).

Mr Monti, I would like to welcome you warmly to the European Parliament. It is a great honour for us to have you here today. I wish you a warm welcome on behalf of the whole House!

(Applause)

  Mario Monti, Prime Minister of Italy. – (IT) Mr President, it is a great honour for me and for the Italian Government to have been invited to the European Parliament to address this plenary session.

I would like to start by paying tribute to the European Parliament. It really is a moving experience for me to be here in this place. I remember the first meeting I had with the European Parliament in January 1995, for the hearings to confirm my appointment as a member of the European Commission. For the next ten years, Parliament was a decisive point of contact for me, and I watched the influence of democratic life in Europe grow in this Chamber, in the Brussels Chamber and in the Chambers of the Commission. I have always found that, for the Commission that I was a member of – and I greet the representatives of the Commission – Parliament was a key ally in driving forward the European project.

Now I find myself on a bench in Parliament which I never had the opportunity to sit on, here in the Council area, and it is a new experience for me to be responsible for the policy of a Member State. I can assure you that for me, the responsibility I feel towards my country and the responsibility I feel as an Italian towards the European Union are one and the same thing.

(Applause)

All too often, from Brussels, as a Commissioner, I saw national governments pointing the finger at European institutions after they had participated in decisions taken by European institutions. Well, I promised myself never to play such a dirty trick on the European Union …

(Applause)

… and I always explain to my fellow citizens, in Parliament and elsewhere, that the important sacrifices and difficult reforms which Italian citizens have been called upon to carry out at this time are not imposed by Europe: they are needed to improve Italian economic, social and civil life and, above all, in the interests of our children. It is also something that Europe has been asking us to do and has recommended, but it should not be blamed on the European Union.

I very much feel the responsibility of being at the helm of a country at the moment that has a raw material that is increasingly rare within the European Union, that is to say, public opinion in favour of European integration and construction. I feel the duty not to waste this, but rather to cultivate this raw material. Therefore, I feel I have to proceed with caution with the need to persuade citizens, but using substantive arguments, and not only – and not so much – on the basis of conditions imposed by Europe. Whenever I can, I call upon Heads of Government of other Member States to take the same careful approach to this key shared project of ours.

Italy at this juncture, Mr President, ladies and gentlemen, is engaged in a complex exit strategy in order to emerge from the crisis. I think we are gradually managing to get our country out of the shadow zone into which it fell for a short time, a potential source of problems, of contagion, a breeding ground of disease for the euro area. We are making every effort in terms of budgetary consolidation and in terms of structural reforms. I want to remind you of the commitment made last summer by my predecessor, Prime Minister Silvio Berlusconi, to balance the Italian state budget as early as 2013, in other words, a couple of years before other EU Member States – a commitment that was made in the midst of an emergency – has been maintained by my government, which has not asked to change it, even though it is extremely tough: it is a commitment that will require a primary surplus of about five per cent of gross domestic product, net of interest payments.

We are determined to achieve this budgetary consolidation quickly, as we are determined, with the unusual arrangement that we have in government and in relations with Parliament right now in Italy, to undertake very quickly the structural reforms required.

Of course Italy, as it gradually shores up its position – and the road ahead is still long but I am very encouraged by what is happening – is a country that will not limit itself to passively transposing the policy guidelines of the European Union, but a country that will contribute increasingly to establishing these guidelines and playing the role that is naturally incumbent on one of the great founding nations of the European Union and one of the biggest economies in the euro area.

(Applause)

It is in this spirit that I was pleased to accept the invitation sent to Italy by the German Chancellor and the President of the French Republic to work closely together and I have always made it clear to them, ever since our first triangular meeting, that the contribution that Italy intends to bring to the table is a contribution focusing on EU methods, which recognises the precedence of the European institutions and which intends to make the most of every opportunity to build bridges instead of walls with those countries that are not yet in the euro and with those that have indicated that they wish never to be part of the euro area. I believe it is important for the EU to be inclusive, rather than to exclude.

Mr President, given this session’s specific topic ‘Economic crisis, growth and employment’, allow me to dedicate a few moments to what I consider the primary risk at this stage of European life. The euro has so far been the boldest move in building the community: we simply cannot allow it to become a factor for disintegration and separation among Europeans. This risk exists, and the solution to the euro area crisis is also close at hand – I believe it is so and we are committed to it. I believe, however, that we need to focus just as much effort on regaining a united spirit, a sense of belonging to a single project. The euro area crisis has given rise to too much resentment, has recreated too many stereotypes, has split Europeans on the basis of latitude, has split Europeans into core states and peripheral states. All these classifications should be rejected decisively.

(Applause)

I am the representative of a State considered to be geographically peripheral and I have nothing to object to this geographical connotation; at the same time, I have to point out that the core States – in which Italy was included from the standpoint of responsibility, if you will – starting with the two largest euro area economies, Germany and France, were at the origin of the Stability and Growth Pact crisis and its limited credibility in 2003 when, with the complicity of Italy which presided over the ECOFIN Council at the time, these two countries preferred to bring their political influence to bear over the other Member States to essentially break the mechanism for enforcement and for the application of rules.

This is a fact that is now recognised both by the leaders of Germany and of France, so I am not slighting my colleagues, the German Chancellor and the President of the French Republic. However, it is a fact that budgetary credibility was seriously undermined from within the core of the euro area, which, from a historical perspective, had the great merit of setting up and encouraging that budgetary discipline. We cannot therefore forget that there are responsibilities both in the core, and in the peripheral areas, because it is true that several states in the periphery, at some point – including the one which I am representing here –

(Applause)

have let things slide too far along the road towards budgetary indiscipline. However, there is no such thing in the European Union, Mr President, ladies and gentlemen, as heroes and villains. We all need to feel jointly responsible both for the things that were done in the past and, most importantly, in building the future.

(Applause)

In essence, it has taken us eight long hard years, in which the Member States, the Commission – primarily the Commission, I am pleased to recognise that and emphasise that great institution that is the driving force behind European integration – and Parliament – which has played an ever greater role in recent years – these institutions have spent eight tough years rebuilding credibility in the Stability and Growth Pact; and I want to pay tribute to the role that Parliament has had, in particular with the ‘six–pack’, a construct which has introduced even greater credibility in discipline than the Council had originally put in place. Therefore, when we think that Parliaments are, in reality at this historical juncture, factors of indiscipline vis-à-vis the Executives – which is true sometimes at national level, but I am pleased today to acknowledge that it is not true at European level – well, this Parliament, thanks to its work, has become a factor of discipline.

(Applause)

Now I do not think this is the time to put aside budgetary discipline, just because we are pleased to have the fiscal compact and want to turn to another page on the European agenda, the one marked growth. I believe we have to reconcile both these aspects. This holds true even in daily life within our countries. Yesterday, for example, with my colleagues in the Cabinet in Rome, I had to take the difficult and unpopular decision to refuse a financial guarantee from the Italian State for a magnificent project to bring the 2020 Olympics to Rome. There was much disappointment in Italy over this decision, in Rome first and foremost. However, we argued – and I have the impression that the Italian public has understood – that the imperative for Italy today lies elsewhere, in our own interest and in that of Europe – and, by the way, last week in the United States, in Washington, I was able to witness with my own eyes just how much euro area stability is considered to be an essential component for the world economy. Therefore, at this juncture, any gesture we make which might defer sums which we cannot currently quantify to any degree of certainty would not appear to be in line with the responsibility that we as a government must take – even though, all too often, this has been avoided in the past in all countries – which is to avoid passing on debts to the future and to future generations.

I therefore hope that there will be other opportunities for great events in Italy, as has happened many times before, when Italy was able to make a contribution to culture, sports and European events. I believe, however, that this is the type of evidence we have to offer to show that budgetary discipline is not a recent acquisition that we want to set aside as soon as we can, but that it is a new way of experiencing public life.

(Applause)

In the European Council, Mr President, Italy is focusing increasingly on growth, particularly because we have a clear conscience given that within our borders, we are doing everything that is needed for budgetary discipline. In any case, the European Council meeting of 30 January, which will be followed by one on 1 March, has a lot to say and even more to do with regard to growth. I know how much this Parliament interprets the growth imperative in its daily work, in its great motions, and in its detailed decisions on individual projects.

Italy has successfully sought, for example, within the European Council, to give greater priority than in the recent past to growth as one of the objectives of economic policy. This is perfectly feasible without casting doubt over budgetary discipline: we simply need to leave certain clichés behind us. For example, the single market – the first brick in European integration – still has much to say and much to contribute to European economic growth. Commissioner Barnier has been the driving force in the Commission’s latest initiative, the Single Market Act, which, in itself, contains immense growth potential. In the European Council, Italy is fighting to ensure that words are followed by deeds, stepping up the pace and in such a way that Member State leaders put themselves personally on the line and give this the highest political importance, to prevent the single market from looking like a grey mass of unending directives and regulations. The single market is the body and, in some ways, the soul of European integration, and we have asked for considerable backing to be given to its development.

Another example – and here I repeat something I said in the European Council: the fiscal compact is great, it is great that the armoury at our disposal for budgetary discipline has been strengthened for the fourth or fifth time, but should we not be doing the same job, at least in part, to discipline the economic integration of the single market?

(Applause)

Why should we have, as it is right that we have, serious and incisive mechanisms with penalties for fiscal discipline, while a Member State that breaches the rules of the single market may persist in the breach for four to five years, until the Commission gets through all of the stages of the procedure and finally gets to the Court of Justice? These limitations on European integration are responsible for, among other things, the malfunctioning of the euro area itself as an optimal currency area. It is great to have focused so much on monetary union and the budgetary discipline that must accompany it; it is terrible not to have focused so much on economic union, which is the pillar on which monetary union stands. Now is the time for all of us to get together to focus more on this.

As regards growth – and, Mr President, I am going to conclude because I know that in this Parliament, time is rightly rationed much more than in any other place of public discussion in Europe, another contribution that you make to discipline, Mr President – stability bonds, on which this Parliament voted by an overwhelming majority, are a tool that I have encouraged elsewhere without ever seeing them as a possible source of fiscal indiscipline. They are a tool to ensure greater integration of financial markets which, if properly constructed along the lines of the Commission’s Green Paper and the report adopted today by the European Parliament, may in fact help to make the actions of the financial markets into a disciplining factor for public budgets. It is just one example of tools that can be implemented, while respecting the various sensitivities: if a major country believes that stability bonds should come a little bit later rather than earlier, again, this sensitivity should be respected, as long as no one claims that exploring them is dangerous. I believe that one day, the time will come – but not for a while – to reconsider whether the way we currently treat the act of private investment, but also of public investment, is today as appropriate as it could be.

I am happy that in our constitutions now, following the fiscal compact, we are introducing the rule of a structurally correct balanced budget; I am a little less happy that we have called it the ‘golden rule’. This is an important discipline but once, even in the German economic culture, the golden rule stated that there could be state debt but only to the limit of public investment; so we can finance with debt what is essentially the formation of capital.

(Applause)

One day, once we have completed the great transformation which – thanks especially to Germany – we have made in recent years towards a culture of discipline, Europe will be able to afford, without avoiding the issue or watering it down, to look more coolly and calmly even at tools for growth such as these.

The final point, Mr President, which I have little time to develop: I beg to refer to an article published this morning in the French, Italian and German press, and which bears my signature along with that of Ms Sylvie Goulard. We need to reconcile – and for now we are not managing to do this so well – integration, which we need in ever increasing doses, and democracy, which we certainly do not wish to give up. How do you reconcile democracy and integration? Well ...

(Murmurs of dissent)

I think it is certainly possible to reconcile democracy and integration.

(Applause)

Of course, only a deeply superficial, insular culture...

(Applause)

... might naively believe that integration means a super-state.

(Call of ‘Who elected you?’)

A vast majority in the Italian Parliament.

(IT) Mr President, please forgive me if I am overtaken by my passion for European integration, which does not mean a superstate at all, but rather a continuous operation of the principle of subsidiarity and needs to be reconciled with democracy. It is clearly evident in the last few days what might happen if citizens, in certain Member States, get the impression that integration occurs to the detriment of democracy.

Instead of trying to re-invent the wheel, as we say in Italian, I believe that we need to work on the existing institutions. There is in Europe – I believe you have heard of it – an institution directly elected through universal suffrage by citizens, known as the European Parliament. This institution has a major impact on EU life: I was a member of a European Commission that this Parliament sent packing a number of years ago. I can assure you that scrutiny is alive and well in the European Parliament!

In any case, I think that, by continuing to develop the functions of the European Parliament, and with the full backing of the Commission, we can better reconcile the efficacy of a body such as the Council – which, while being fully EU-based, is also a direct expression of governments – with that of the other organs invented by the mind of that extraordinary Frenchman, Jean Monnet, so that, as they should, integration and democracy may be increasingly in tune with each other.

(Applause)

  Joseph Daul, on behalf of the PPE Group. – (FR) Mr President, Prime Minister, ladies and gentlemen, in this Assembly, we are convinced that Europe must both restore its public finances and find the road to growth. That is what you have just said to us.

I would like to say to you, Mr Monti, that the economic reforms that you have undertaken in your country serve as an example of this twin approach. On the one hand, you have continued with many reforms initiated by the previous government, and this too you have told us about. On the other hand, you have made major changes, especially by liberalising some professions. That is the right approach as it will create jobs and stimulate competition.

Thanks to your proposal to introduce a type of flexible security, you will strengthen the social market economy, and you will make the labour market more dynamic and more protective too. Your fight against fraud and in favour of a more transparent tax system is equally appropriate and will allow a reduction of the tax burden borne by Italians. My group supports this package of measures which, I will repeat, serves as an example for Europe.

I hope that many countries will follow suit, since a return to growth requires us to re-establish a favourable economic and political climate. We also have to give hope back to our fellow citizens, not a false hope that would soon be dashed as it foundered on the realities, but a hope based on the development of a more competitive economy and on the indispensable reforms of our collective lifestyle. Now, like most European countries, the Italian economy is strong, as it is built on a real economy, on competitive sectors that are full of potential. Mr Monti, you have begun to optimise this potential, to free the economy from burdens that were overwhelming it. We must do likewise in all of our countries and take our example from those who do it best.

We must promote under-used resources via, as you said, both national and European policies. In particular, we must allow our SMEs, our researchers and millions of Europeans, especially the young unemployed, to develop their potential. This policy requires a spirit of responsibility, the very one that you, my dear Mr Monti, are displaying at the head of your government.

For some, there is a great temptation to confuse public spending and investment, as you have said, but it is only through investment that we shall achieve sustainable growth. Former President of the Commission, Jacques Delors, used to say that one cannot fall in love with the internal market. On the day after Saint Valentine’s Day, neither can one fall in love with European competitiveness.

However, Mr Monti, in the report that you have published on the re-launch of the single market, you laid out some good pointers on how to restore growth and employment. I would like to speak about greater fiscal coordination between the Member States. I would like to speak about a new impulse for political and social support for the integration of the European market. I would like to speak about the internal market which, almost 20 years after its launch in 1993, remains unfinished. You reminded us of this.

Mr President, although everyone knows how much I favour the Franco-German engine, to the same extent I wish that, like Italy, other countries would make their opinions, their proposals or even their counter-proposals heard.

I would also like to take this opportunity to welcome your determined commitment to the Community method and to European integration. Like the European Parliament, you know, Mr Monti, that the return of the intergovernmental method would be a serious mistake, a retrograde step for the 500 million Europeans. I am grateful to you for having punched to your full weight. Carry on opposing this intergovernmental method. You have the majority of this Parliament with you.

This Parliament wishes to make another voice heard, that of a united, responsible Europe, that of an integrated, political Europe. We know that we can count on you as an ally in this.

  Hannes Swoboda, on behalf of the S&D Group. – Mr President, I should like to welcome the Prime Minister to this Parliament, not only on behalf of the colleghi democratici, but also on behalf of all the Social Democratic Group. It is good to have you here, Prime Minister. By a slip of the tongue, you said that you had been elected by the European Parliament. Well, that is not yet true, but we would have elected you after the speech you gave today; so come back to the European scene when you finish your prime ministership, so that we can have a strong European in our Parliament.

Prime Minister, expectations are very high, not only in Italy, but also in Europe. Not with those people over there, but with the public in general. You spoke about growth, and the necessity of combining growth with fiscal discipline. I would go one step further and say that, perhaps, fiscal discipline can be achieved more easily if we have growth and employment. Prime Minister, we have had many declarations, including those made by Italy and other countries, but the actions are still missing.

I need only quote, for example, from the Final Declaration of the Cannes Summit, where President Sarkozy was so proud to hold the G20 meeting. One sentence of that declaration reads: ‘We firmly believe that employment must be at the heart of the actions and policies to restore growth and confidence that we undertake under the Framework for strong, sustainable and balanced growth’. A good declaration, but where is the action? The action is still missing.

You spoke about some instruments such as stability bonds. We are still discussing growth policies, but we do not have enough action. Secondly, for us – as you know, Prime Minister – a social Europe is something concrete. Here again, to quote from the declaration of the Cannes Summit of the G20: ‘We recognise the importance of investing in nationally determined social protection floors in each of our countries ... We are convinced of the essential role of social dialogue’.

This morning, we discussed how the social dialogue has been destroyed, for example in Greece; how the Troika says there must be no social dialogue, no social partners, just legislation – and we can return to democracy later. For us, growth, employment and social policies have to go hand in hand.

My next point relates to tax. For a social Europe, the tax system must also be social and fair, and we have to fight against tax evasion. Again, the G20 said: ‘We are committed to protect our public finances and the global financial system from the risks posed by tax havens and non-cooperative jurisdictions’. Yet there has been no reaction, not a single action against tax havens; not a single action to deal with non-cooperative jurisdictions. What should Greek citizens think when the money of the rich is going to Switzerland and other countries, untaxed, and they have to pay tax on their reduced salaries? This is an impossible situation.

You also know, Prime Minister, that the financial transaction tax is very important for us. It is often said that, well, we have to fear tax evasion. A study by our Group showed that, if the financial tax is applied right, tax evasion need not be a very big problem. We accept tax evasion involving the Bahamas, Switzerland and many other countries, but in the case of the financial transaction tax, all of a sudden we are very restrictive. So this is another point which our Group regards as very important.

I agree with you and, as I said, I would even go a step further. In a growing Europe, in a Europe with more jobs and fewer unemployed people, in a social and fair Europe with a fair tax system, fiscal consolidation is much easier to achieve and can be accepted by the citizens.

My next point is to stress that we also have European institutions, such as the European Central Bank and the European Investment Bank, that can contribute to your – and our – concept of growth and development. Concerning the European Investment Bank, why not give it more credit possibilities, especially for the benefit of small and medium-sized industries? The European Investment Bank can also help to generate growth. As for the European Central Bank, another Italian – Mr Draghi, whom I met on Monday – is doing a good job there. I would like you to follow and support your colleague in the European Central Bank, so as to do the utmost to promote growth and create enough liquidity in Europe for growth generation.

I think with these two Italians, Draghi and Monti, Europe looks different, and I hope that this can be a success story for Europe now. Someone has just said ‘Super Mario’: we shall see. Let us hope for the ‘Super’.

My last point, Mr Prime Minister, is about a democratic Europe. You are absolutely right: democracy and integration are no contradiction. But democracy for us is not the Council as such, because some Members of the Council are trying to regain their power. Many citizens ask: ‘I thought Parliament emerged as the winner under the Lisbon Treaty, now what has happened to the role of the Parliament?’ I know that the Lisbon Treaty was not the favourite treaty of members of governments and prime ministers, but I hope that, with your conception of democracy, you will support Parliament’s request to be part of that democratic game. I hope it will not be as it was with the fiscal treaty, and that we will not have to force our way into the debate and the discussions in order to achieve some small changes. We should be involved in the discussion from the beginning.

The question of democracy does not only relate to the Commission. We discussed this morning how some of the Troika people go into countries like locusts, aggravating rather than improving the situation, as in Greece. The approach in Italy is quite different because it involves both fiscal responsibility and growth, and not only fiscal discipline and fiscal stability.

We have high hopes for you and so finally, Prime Minister, we are very happy that you are here. You are working for a strong Italy and a strong Europe, and that is also our wish. We need Italy, as a founding member of this European Union, to be strong, democratic and economically safe and sound, and to have full employment and social policies. That is your task: you will fulfil it, we are sure, with our support.

  Guy Verhofstadt, on behalf of the ALDE Group. – (IT) Mr President, Mario, both my group and we in the Spinelli group are proud of the fact that you have become President of the Italian Council of Ministers. I feel he is doing an impressive job because, in the space of just a few weeks, he has guided Italy onto a virtuous path, by implementing profound structural reforms that are necessary not only for his country but also for Europe.

My friends, at last we have a true federalist in the European Council!

I will not continue in Italian. I am more qualified to talk about Italian wine than Italian politics.

Dear Prime Minister, dear Mario, naturally, I think what you need today is more than compliments. What you need now from our Parliament and from our colleagues in the European Council is more than just vocal or moral support. What you need today is concrete support from this Parliament and from the European Council – mainly, a plan and a proposal to reduce interest rates for everybody in Europe.

We should remember that Italy, even after all the reforms, is today paying exactly three times the interest rate of Germany – this morning it was 1.9% for Germany and 5.7% for Italy – and this cannot continue if we want to recover from this euro crisis. We can do two things. First of all, it is important to remember that we can establish the redemption fund. It is a German idea – so it is a good idea – to create a redemption fund, a fund of EUR 2.3 trillion that, as you know, would mutualise debt above 60 percent and that could really reduce interest rates, not only for Italy, but for all countries, including Germany.

You should realise, Mr Monti, that only two weeks ago, this Parliament called, in a resolution, for the establishment of this fund. The idea of a majority of Members, I believe, is to link it to the current ‘two-pack’ legislation that we are discussing. It is the best system because I do not think that the European Central Bank can continue forever to do what it is doing at the moment, namely, inject money every two or three months.

In the longer term, I think a common bond market is a very obvious idea – as you indicated, and I was very pleased with your intervention. As Mr Monti has said (and this is an important message), this instrument would create not only solidarity but also real discipline in our monetary system. It would, in any case, be a better and more structural solution than doing what we are doing now. We have already put EUR 1 trillion of taxpayers’ money into resolving the crisis; we have three Member States under assistance programmes; and we now have the downgrading of the ratings of the main economies in the world – France, Britain and perhaps tomorrow Germany. This is a crisis that is causing thousands of Europeans to live in hardship. So I think now is the time to have a structural solution and to let not only the taxpayers but also the financial institutions and the bondholders pay by means of a structural reform of the bond market in Europe.

My final remark is that Italy is not Greece – I should say, on the contrary. I think that today, Greece should look at what is happening in Italy. Greece also needs structural reforms and to reduce its enormous public sector. It also needs to reform its political system and maybe, as I have already said to Mr Monti, it would be a good idea to send him to Greece after he has finished his work in Italy. He could be an excellent roving Minister for the whole of Europe where there are difficulties in the euro area. Thank you Mario.

  Rebecca Harms, on behalf of the Verts/ALE Group. – (DE) Mr President, Mr Monti, in your speech, and in the article which you published this morning together with Ms Goulard, you made two things clear.

Firstly, you are the person who is in a position to bring civilisation back to Italian politics, after it has been through a rather difficult period. Also, you have indicated to us that you may be one of those strong men who can help to do the same thing for European politics. On an entirely serious note, I believe that this is what it is all about. I listened very carefully to your speech. At some points I thought: ‘This is good, but could he not be even clearer? Could he not be more specific in some places about which difficulties he is referring to?’. Mr Verhofstadt has just mentioned the Italian figures. Italy, Spain, Portugal and Ireland are the countries where people feel most afraid when they hear the reports from Greece. We have constantly been saying that Italy is not Greece and that Portugal, Spain and Ireland are all different.

However, you know that the crisis is by no means under control and it could still spread. As I have long since been aware that you started your career in the financial industry, in the banking sector, I want to ask you some questions at this point to which I would like you to give even clearer answers.

Firstly, when you look at Greece and say that we need a more inclusive policy, we need to keep Europe together, do you believe that the crisis policy which is currently taking shape in Greece puts us on the right track? I do not think that I can definitely answer ‘yes’ to that question at the moment. Commissioner Kroes said yesterday that it would not be a disaster if Greece were to leave the euro area. I thought that the trite and trivial way in which she said this was extremely dangerous. What are the Greeks supposed to think at this point?

Secondly, you have spoken a great deal about budgetary discipline. As someone whose job it is to clear up the mess in Italy, do you think that it is clever in terms of budgetary discipline to focus solely on cuts? What is taking place in Greece at the moment only involves cuts. The Greeks are not putting their budget in order and ensuring that expenditure and income are in a sustainable balance with one another. Instead, they are simply cutting back and, despite all the austerity measures, the situation in the country is getting even worse for the majority of people and, in particular, for the poorer citizens. Is that a sustainable approach from the perspective of another crisis country? As your background is in the banking sector, can you explain to me why we have decided that the major banks are too big too fail and we need to provide them with permanent support, despite all the current weaknesses in the banking sector? We have far less confidence in the countries that are in crisis. We are imposing detailed requirements on these countries in the case of the much smaller sums of money that we are making available to them. We are telling them what their policies must be without really thinking carefully about it. I have never understood why the two approaches are so totally different.

I know that you have begun taking a detailed look at tax evasion in Italy. The investigations that you have organised and the tax audits that you have announced in Cortina d’Ampezzo are sending out a very strong signal. Would you be prepared to support the introduction of a Europe-wide agreement that would prevent tax evasion and money laundering on such a vast scale? Every year in Italy, you lose almost EUR 300 billion. If you were to keep hold of this money, Italy would be out of debt within 10 years.

Mr Monti, let me conclude by saying one thing. Among the prime ministers of the crisis countries, you are in a special position. You are unique in commanding respect throughout Europe. I believe that, with your experience of being a Commissioner, you have a special responsibility for the future of the relationship between the crisis countries and those countries in the European Union which are not yet in crisis.

  Martin Callanan, on behalf of the ECR Group. – Mr President, another famous Monty – I refer of course to the equally famous Monty Python – taught us to always look on the bright side of life. Although the economic news is gloomy, there are one or two reasons for Italy to be optimistic. On this point, I agree with Mr Verhofstadt because, of course, Italy – thankfully – is not Greece. Nevertheless, the national current account has been mismanaged, going from a healthy surplus to a nearly crippling deficit in merely a decade.

It appears so far that the markets respect your leadership, Prime Minister. 10-year bond yields are almost at a manageable position thanks partly to your proposed economic reforms, but mainly to the actions of the European Central Bank, which has – crucially – bought you some time. In Italy, fiscal consolidation and economic reform could possibly work, but in Greece, they are clearly not working. An orderly default and a Greek euro exit may be bad politics for Angela Merkel, but I believe it is the ‘least worst’ option now for the euro area and for the EU as a whole.

Fiscal consolidation will ease the current crisis, but in isolation, it is not the long-term solution to our economic weakness. The answer, as many people here have said, is growth, and we have no shortage of policy statements calling for growth and jobs. But let us be honest: so far, they have all failed, because they focus more on buzz-words and on gestures aimed at keeping everyone happy and are based on the premise that somehow, politicians can create jobs. This is the kind of bureaucratic, statist attitude that got us into this situation in the first place.

Of course, there is one recent economic policy paper that is being put into practice: I refer to the Mario Monti paper on the single market, which is being enthusiastically championed in the Committee on the Internal Market and Consumer Protection by my colleague, Malcolm Harbour. In my view, the greatest problem we face in Europe is that competition has been undermined by the focus on harmonisation instead of liberalisation – and you need only look at EU employment policy to see the devastating impact that it has had on many of our economies. The single market has the ability to deliver more liberal and flexible economies across the EU. The answer is not more harmonisation, rules or red tape – and it is certainly not more Europe. The answer, in my view, is a better Europe: a Europe of liberalisation and competition.

Professor Monti, as Prime Minister of Italy, talking about democracy (you were, of course, not elected by any citizens, although I accept that you were elected by the Italian Parliament), you have a great opportunity to articulate this vision and champion economic restructuring and liberalisation not just in Italy, but across the rest of Europe as well. If you succeed in this immensely difficult and challenging task, you will have the support of my Group in your efforts.

  Patrick Le Hyaric, on behalf of the GUE/NGL Group. – (FR) Mr President, Presidents, I fear once again with this debate that there is no desire to camouflage the absurd, detestable religion that is leading Europe into chaos: austerity for the people.

You have not actually said it, Mr Monti. You spoke to us of discipline, but discipline is always for the people, not for the financiers, as in Greece and in other countries. Now, austerity is proving to be a deadly poison. It allows neither a rebalancing of the public accounts nor economic recovery, because it sacrifices the workers, social protection, jobs and people’s welfare.

You spoke to us at length about democracy, but which democracy are we talking about when you yourself, Mr Monti, are destroying Italian employment law? Which democracy do you mean when, in the Euro Plus Pact, there is a demand that sectoral agreements should no longer be negotiated? Which democracy do you mean when an unelected Troika is running some countries? Which democracy do you mean when future treaties only speak of discipline, supervision, sanctions and cases before the European Court of Justice for those who do not meet the austerity standard? Which democracy do you mean?

The Treaties as they stand do not promote growth and jobs.

On behalf of the Confederal Group of the European United Left – Nordic Green Left, we put to you several proposals for growth and jobs: the introduction of a European minimum wage and a minimum income, as voted for by this Parliament; the defence of public social security through the development of a training-related social security system in Europe; an end to social and fiscal dumping; taxation on capital at the same rate as that on employment; a genuine tax on financial transactions; a European alliance against unequal free trade through the introduction of visas and border protections determined by social and environmental progress; a programme of major projects and the boost of a new industrial and agricultural policy; the development of research, innovation and education.

This would be possible with the creation of a European fund for human, social and ecological development, instead of the European Stability Mechanism, and connected to the European Central Bank, which must be able to buy all or part of the debts of States that are currently in difficulties and offer 1% loans directly to States.

Please do not answer, Mr Monti, that the Treaties prevent you from doing so, as you are in the process of changing them behind the people’s backs, against the people and, therefore, against democracy!

  Francesco Enrico Speroni, on behalf of the EFD Group. – (IT) Mr President, President Monti, you have undoubtedly built up great financial expertise from operations, in academic institutions, and in exclusive clubs such as Bilderberg and the Trilateral Commission. So, it is no coincidence that you recently travelled to Wall Street to meet the masters of that international finance sector whose actions led us into the state which all EU citizens, and particularly those in the euro area, well know, not least from their wallets.

I am still trying to work out whether you met your accomplices or your masters. Accomplices because, as European Commissioner for over a decade, you share responsibility for the economic and financial situation of the Union. Masters because, since you took over as head of government without going through democratic elections, you have been brilliantly managing to plunder taxpayers, taking on the role of official paymaster for international finance.

You have defended and supported here a conception of Europe that does not belong to us and which we do not share, and, just like your patron, Italian President Giorgio Napolitano, you have come up with hackneyed nonsense, such as ‘we cannot end the crisis on our own’. However, you do not see, you two, and those like you who continue to pour out lies, that there are countries in the Western and democratic tradition, such as Switzerland, Norway, New Zealand, Canada and Australia, whose citizens, without a Union and without the euro, are looking at an economy and a financial situation far better than that ...

(The President cut off the speaker)

  Bruno Gollnisch (NI). – (FR) Mr President, Mr Monti, there are many who welcome the speed of your action, an austerity plan that will satisfy every demand made by Mr Draghi, your compatriot and ex-colleague at Goldman Sachs and also current President of the European Central Bank; a liberalisation plan, in-depth reform of the labour market, re-christened as a plan for growth which, for the moment, is, above all, a plan for social regression.

You are congratulated for the courage that you have shown. Is it really courage, though, Mr Monti, when, being appointed to this post, you know that you will continue to carry out its responsibilities as in the past, without ever having to stand for election before the people whom you govern? It should not cause you personal offence if one were to say that your democratic credentials are somewhat limited.

You have, to date, been lauded by the Trilateral Commission and the Bilderberg Group, these somewhat shadowy, globalist bodies. You are a little lacking in democratic legitimacy, even though you enjoy a parliamentary majority.

You have painted a picture of an integrated Europe, but one that respects subsidiarity. However, Prime Minister, my colleagues have answered you: Mr Swoboda, who is Austrian, and Mr Verhofstadt, speaking on behalf of the Group of the Alliance of Liberals and Democrats for Europe, who is Flemish, answered you in English, even though we have interpreters here. Apart from a brief effort by Mr Verhofstadt, they shunned their national tongue. It was the language of Big Brother that they used, not the language of the British patriots here at my side.

  Maroš Šefčovič, Vice-President of the Commission. – Mr President, Italy entered the global financial crisis in a vulnerable position due to its high public debt and low economic growth. But from its first day in office, the government of Prime Minister Monti has shown its determination to address these two challenges and has already adopted several important measures.

On the one hand, in December, it passed a new austerity package which is helping to shore up Italy’s public finances. It should allow Italy to achieve a very sizeable primary surplus by 2013 and put the government debt on a downward path.

On the other hand, between last summer and recent weeks, a broad range of structural measures has been adopted on taxation, pensions, competition, the business environment and the efficiency of the public administration. The most recent measures on opening up closed sectors and administrative simplification can contribute to improving competitiveness and a business environment, removing long-standing bottlenecks to growth and ultimately increasing the adjustment capacity of the economy.

In conclusion, the Commission welcomes the decisive action being taken by the Italian Government and stands ready to assist and support that action as the government sees fit. A concrete example is the Commission’s support in fighting youth unemployment by setting up a dedicated action team for Italy and reprogramming Structural Funds until 2013.

Mr Prime Minister, as you have seen, you have strong support in the European Parliament, and I am sure that you know you have a lot of friends – I would even say fans – in the Commission. I would therefore like to tell you on behalf of the Commission that we wish Italy, your government and you personally all the best in your efforts.

  Mario Monti, Prime Minister of Italy. – (IT) Mr President, since I took up more time than I had envisaged in my opening speech – and I apologise – I will be very concise in these closing words, which I wish to devote first and foremost to thanking you again, Mr President, and those members of the House who expressed their support and esteem for my country, for the government it is my honour to lead, and for me personally.

These words, these feelings and these actions are of great comfort to us and encourage us to try to govern better in Italy, as we seek at the same time to get Italy to make an increasing contribution to a strong European policy, in particular, one geared towards growth. My heartfelt thanks also go to Commissioner Šefčovič for his comments to me.

I believe that I will answer only two points while, due to the complexity of the philosophical and systemic points inherent in his speech, I intend to examine the transcription of the words addressed to me by Mr Speroni and for which I thank him very much.

I want to give two answers, one very short and the other brief.

The very short one is about the observation made by Mr Gollnisch ...

(The speaker addresses the Member in question in French)

(FR) … to whom I would like to say that I am unable to trumpet my democratic legitimacy from being elected and I assure you that, unlike you, sir, and others, I did not stand to obtain such legitimacy. I was asked to do this job, a job which I find fascinating. It is not that I would have taken it on of my own accord. Now, I am sure that, had you been asked to act at a difficult moment as the Head of Government in your country, you would certainly have refused, saying that you would only do so if you had democratic legitimacy.

(Applause)

(IT) Mr President, I thank you for the welcome which you have given me.

I wish to address Ms Harms, picking up on her speech, in more general terms. Many significant comments have been made on the Greek question: we have all thought long and hard about Greece. As one of the elders among you, I would, however, like to call upon you to look at things from an historical perspective. Certainly we may feel that the tough approach being handed out to Greece today may be excessive, and it probably is, but I would suggest that we do not forget that Greek politics for many years – and I say it in all due modesty and as a simple external observer – was a perfect catalogue of the worst practices of politics in our countries. And when we say – and this topic is discussed briefly in the article I mentioned before – that democracy is now working in Europe at the national level, but unfortunately not yet at European level, that can be refuted on two scores. Firstly, here we are in the home of democracy at European level. Secondly, do we really want to use as examples of a well-functioning democracy what we saw for many years in Greece and other countries, based on corruption, nepotism, lack of competition, illicit public procurement, tax evasion and whatever else?

From this point of view, therefore – even though we might regard as excessive the rigour imposed by the euro with its budgetary discipline, and even though I criticise it myself – we should take note that the culture of stability invented in Germany, which we have all absorbed with the euro and the Treaty of Maastricht, has had the advantage of making it necessary to carry out politics in individual countries with greater sobriety, because in the past, it was all too easy for politicians to acquiesce to any demand, raising government spending and piling debt on the shoulders of future generations and thereby ruining their countries.

So I would therefore like to look at Europe as a pivot, whose pendulum has now perhaps swung too far in the direction of rigour, but as an Italian, I think the presence of that pendulum is positive, because a country like Italy, many years ago, in order to join the euro, benefited from having to bring in better discipline.

  President. – Thank you very much for your statement, Mr Monti.

The debate is closed.

Written statements (Rule 149)

  Ildikó Gáll-Pelcz (PPE), in writing. – (HU) Let me first of all thank you for your report today, in which you, too, pointed out the regrettable fact that there is still not enough attention being paid to the growth-stimulating aspects of European policies. However, I must immediately point out that such proposals can only find practical use if they can be integrated into the commonly established system of European economic policy and are, at the same time, aligned to a well-constructed crisis management mechanism. I find that it gives reason for concern that the Commission always outlines ambitious plans, whereas their positive results are sometimes only slightly noticeable. An excellent example would be the set of measures taken to curb youth unemployment. There is no doubt that there is a need for a long-term reform of labour markets; however, these belated reforms are slow in producing the expected results. A pan-European crisis map is needed which assesses and delimits the most severely affected crisis areas based on their core characteristics. We must therefore take into account the availability of jobs, the rate of unemployment, the quality of public services, as well as other ambient conditions. If we fail to do so, Europe’s problems could give rise to even more concern, and we could once again be faced with a wave of dissatisfaction. It is therefore important, in addition to addressing the challenges arising from the current economic crisis, to step up our joint efforts towards ensuring sustainable growth which is conducive to employment.

IN THE CHAIR: ANNI PODIMATA
Vice-President