Financial supervision package (debate) 
President
The next item is the Council and Commission statements on the financial supervision package.
Proinsias De Rossa
Madam President, just an enquiry. I thought we were going to have a catch-the-eye segment in this debate. Is that the case?
President
We will use the catch-the-eye procedure for the statement on the financial supervision package. I must, however, be very clear: I will be very strict regarding speaking times since we are running considerably late and we have a long voting time. Therefore, when someone's time is up I must cut them off, and as for the catch-the-eye procedure, we shall have to stick to five minutes. I am sorry, but that is how it must be this morning.
Didier Reynders
Madam President, ladies and gentlemen, it is with great pleasure that I appear before you again to discuss financial supervision once more, as we have had the opportunity to talk about it following the last Ecofin meeting, while the legislative package on supervision is now being submitted to Parliament's vote.
It is a collection of texts which introduces a particularly important reform in the Union and which responds to several challenges. The first challenge - the President of the Council has just spoken about it - is the response to the crisis. The decade which is just coming to a close has seen the introduction and deployment of the Lamfalussy architecture in all the financial sectors.
The committees of supervisors have, in some way, begun to make their presence felt. They have contributed to the development of European financial legislation and to a process of progressive convergence of prudential supervision. This process was an important and positive first step towards a European approach, but, in the light of the crisis, we really must say that this process did not, in the end, turn out to be ambitious enough.
It did not allow us to prevent or contain the financial crisis or to coordinate rapid and efficient responses on the ground, particularly relating to cross-border cooperation. It is for this reason that we are aiming to create an operational European Systemic Risk Board, with all the administrative support of the European Central Bank, which, under the leadership of its president, is more than ready to work on the implementation and introduction of this board.
I do not doubt that Mr Trichet will bring all his competence and authority to it, including in following up potential warnings or recommendations made under his Presidency. It is for this same end that we also want stronger, more responsive and much better equipped supervisory authorities to prepare the Community technical standards and ensure their full implementation, including in times of crisis.
In the event that a national supervisory authority fails to act, these authorities will have the legal means to make financial establishments conform to the standards. They will help establish a true European supervisory area, which is indispensable for strengthening the internal market. They will thus be involved in the functioning of the colleges of supervisors and will help resolve any disputes between the national authorities while, of course, allowing them to conduct prudential everyday supervision.
Have no fear of words; the introduction of these authorities is an historic agreement, as some have already mentioned many times in this Chamber. The Belgian Presidency made this its main priority in the area of financial markets, but also in a global manner. Let us make no mistake: in this way, we are continuing to build an original supervision model - I will come back to this - but we must also take account of the evolution of the supervision structures of our main partners. This is the second challenge: to show that the European Union of 27 is capable of reforming its financial supervision structures without allowing itself to be left behind by the United States in particular.
With the de Larosière report in February 2009, which the European Council welcomed very warmly, incidentally, the debate in Europe moved in promising directions, but we had to make these hopes of reform succeed. The United States has meanwhile undertaken a large-scale revision of its supervision with the adoption of the Dodd-Frank Act. In voting today, I hope, in favour of the legislative package, which is the fruit of a year's investigation, negotiations and cooperation between the different institutions, the European Parliament will show that the European Union is not being left behind, and that it is also a leader in the reform process supported at the G20.
However, we can only be a true leader in the long term. Today's historic vote aside, we will have to ensure that our new system keeps going and evolves. This is the third challenge. What we are aiming at, firstly, is a model of micro-prudential supervision which is largely decentralised, where the authorities support and coordinate the national supervisors without taking their place.
Secondly, what we also want is a system which becomes ever stronger, not one which stands still. With the European Systemic Risk Board, we will introduce an essential organ of debate and macro-economic decision making, including at a transatlantic or even a global level.
With the European supervisory authorities, we will have effective actors of risk prevention and treatment if we give them the powers to carry out their actions. This is partly the case with the Omnibus I Directive, on which Parliament is being asked to give its opinion today. However, other legislative measures will have to follow as part of the revision of existing texts.
It is on this point, Madam President, ladies and gentlemen, that I would like to conclude. Today, we are coming to the end of a crucial first step and, while hoping for a positive result from your vote just now, I would like, in particular, to thank the Chair of the Committee on Economic and Monetary Affairs, Mrs Bowles, the various Parliamentary rapporteurs, Mrs Goulard, Mr García-Margallo y Marfil, Mr Skinner, Mr Giegold, Mr Sánchez Presedo and their shadow rapporteurs, as well as Commissioners Rehn and Barnier, who are present in this Chamber, and, of course, all their collaborators too. There have been fruitful exchanges - and, I think, constructive ones - between us on the package of amended texts put to the vote today.
However, I hope that the will to achieve results which has inspired us will continue to lead the negotiations on future texts to complete and modernise this system further. I think I can say, on behalf of those who will succeed me as President-in-Office of the Council over the next few months, and in view of recent negotiations, that I am confident that this will be the case. I hope that we will be able to come here soon with new agreements - particularly regarding investment funds - and that together, we will be able, with Commissioner Barnier, to support a whole range of actions to implement new legislative texts.
Michel Barnier
Madam President, ladies and gentlemen, the agreement on the financial supervision package which you will be voting on in a few moments, almost a year to the day since the Commission adopted these proposals, is, I think I can say, something quite historic in terms of the evolution of financial regulation in Europe.
Since the beginning of the financial crisis, the European Union has reacted at international level. It initiated the G20 process launched at the Washington Summit in November 2008. The working group led by Mr de Larosière learnt the first major lesson from this crisis and immediately afterwards, the Commission drew up its proposals. Allow me to pay tribute to Mr de Larosière's intelligent work, to which we owe a great deal at the moment.
With this agreement, we will have, if you wish, a framework in which, from now on, all initiatives will be situated, product by product, market by market, player by player, to implement what we committed ourselves to and what I committed myself to when I spoke to you on 13 January: intelligent regulation and effective supervision.
This framework that we will adopt is the foundation which gives credibility to all the sector-based initiatives that we want to take. We owe this agreement to the personal commitment and competence many of you have shown. Allow me, in turn, to thank your rapporteurs, Mr García-Margallo, Mr Skinner, Mr Sánchez Presedo, Mrs Goulard, Mr Giegold, Mr Tremosa i Balcells and Mr Balz, as well as the shadow rapporteurs.
I would also like to thank Mrs Bowles, who led this negotiation with great determination. I would like to thank the President of the Economic and Financial Affairs Council (ECOFIN), Mr Reynders, for the proactive role he played with his teams - which was decisive - building on the good work that the Spanish and Swedish Presidencies had done before him.
Allow me in a rather unusual manner perhaps - I will tell you why - to say a word of thanks on behalf of the European Commission to the person beside me, Mr Wright, because in a few days, he will step down as Deputy Director-General for the Internal Market and Services. I would like to say that I believe that this man is a credit to European public service.
Ladies and gentlemen, the value added by Parliament is undeniable. It was decisive. In particular, I am thinking of the strengthening of the competences of the European supervisory authorities: mediation, emergency measures, drafting of legal and technical standards with a consumer protection role - which we will come back to - along with prevention of, and protection from, certain toxic financial products and the cross-border nature of the institutions which will be taken into account to a greater degree.
Then there is the establishment of the European Systemic Risk Board (ESRB) for which we owe much to Parliament, in particular, as regards its Presidency, and here, I would also like to thank my colleague and friend, Mr Rehn, and his staff.
All of that is, of course, a compromise. Some would have liked to go much further. On many issues, the Commission itself has made dynamic compromises and concessions. We regret, for example, the solution ultimately accepted concerning the drafting process for technical standards, which, in our view, must not serve as a precedent for other sectors, and what is more, I will confirm this in a statement.
However, on the whole, after the unanimous vote of the Council, after your vote today if you want it, from the beginning of next year, Europe will rely on a supervision model adapted to its needs and the reality of its financial industry. In most European countries, most of the banks belong to another country. This is what defines the transnational dimension, both of the financial establishments and the risks that they can bear.
We will have a supervision model that is adapted to prevent crises more effectively. We will be able to show citizens who are concerned and who wonder whether Europe has reacted that it is drawing concrete lessons from the crisis and that it is doing this at the same time as the Americans, and hopefully other continents, in the framework of the decisions of the G20.
As for the authorities, there is a huge amount of technical and budgetary work ahead of us - ahead of me - that we are committed to, so that the authorities effectively see the light of day on 1 January 2011. With the agreement of the European Parliament, we will have to appoint the future presidents and director-generals of these authorities. I would like to say before you that the only criterion that will govern these appointments must be that of independence and competence to make these new authorities succeed, and I am confident that the future President of the ESRB who, thanks to you, is the President of the European Central Bank, will have this concern for independence and this competence.
Then, ladies and gentlemen, we will determinedly fill the framework that we have on 1 January. The European Securities and Markets Authority will quickly gain power thanks to the role reserved for it in decisions that are taken or that will be taken: the proposal to put the supervision of credit rating agencies at European level, the draft regulations on over-the-counter derivatives and short-selling, and then the Credit Default Swaps, adopted just a few days ago.
We shall not stop there. This is a whole integrated programme to consolidate and stabilise our financial system and make it more transparent that we will follow with you, step by step: the regulation of the hedge fund and private equity sector that we are working on at this very moment; the implementation of the Basel III Accord on bank capital; the review next year of the directive on financial markets; the strengthening of sanctions within the framework of the revision of the directive on market abuse; and the introduction of a European framework for crisis management and resolution.
All of these measures must allow us to avoid the repeat of serious crises, to protect consumers, who are also taxpayers, and feed the sustainable and fair growth we are calling for.
Ladies and gentlemen, I have always thought that in the area of financial sectors, as in the area of the environment, prevention is always cheaper than cure. I would like to remind you that during this financial crisis, in one way or another, we mobilised 17% of European GDP to save the financial system. It is the banks that must pay for the banks, not taxpayers. Prevention will always be cheaper than cure.
We will present all of these measures in the framework of the agenda adopted by the Commission and supported by the ECOFIN Council on 2 June and our aim is for them to be implemented and presented with determination, voted for if you wish, in any case, adopted and proposed by the Commission, by the end of 2011.
Ladies and gentlemen, Madam President, I would like to say on a personal level that the quality of relations that we have had and the confidence without complacency that has driven our debates are, to me, an encouraging sign for the whole of this very rigorous and demanding agenda. On behalf of all the services of the Commission, I would like to thank you for that.
José Manuel García-Margallo y Marfil
Madam President, today is a good day for Europe. In December, we had a poor agreement and now, thanks to the cooperation between Parliament, the Presidency-in-Office of the Council and the Commission, we have a good agreement.
It is a good agreement that is going to establish genuinely European authorities that are strong and subject to the democratic control of Parliament: authorities that are going to be designed to ensure that all the banks are subject to the same rules across the European Union. They will be able to impose their decisions on the national supervisory bodies and, if they do not comply with them, on the private banks, in order to protect families and businesses. This will enable them to combat the banks that could cause systemic risks and prevent taxpayers from having to pay once again for the irrational exuberance of some financial institutions.
The lesson that we can learn from this debate is that Parliament is not like a dog whose bark is worse than his bite that will back down at the slightest gesture from the Council: it holds firmly to its positions. Nor is it a dog in the manger: it is a good ally of the Council and the Commission for moving forward in the process of European integration.
Thanks to my fellow Members, Commissioner Barnier and Mr Reynders, we now have an excellent agreement on which we should congratulate ourselves.
Peter Skinner
on behalf of the S&D Group. - Madam President, I would like to thank the Commissioner and Mr Reynders. I would also like to thank David Wright very much for his activity, as well as my colleagues around the room. We have been quite successful.
However, you are either captured by the moment or you capture it. A financial crisis has given life to new agencies, which are much needed and very welcome at this time across the European Union and perhaps even across the globe, but the power invested in these institutions also has to be a responsible power. Ambition, therefore, must have a purpose, in order for there to be any fulfilment, and that purpose must be shared by our citizens whose jobs and livelihoods depend upon us getting it right.
There is no doubt that the discussion between Member States and Parliament has often led to tensions during this debate, but none of us have completely got our way and all of us have been successful in delivering what will, I believe, be a success.
Parliament has pushed for greater powers at European level. Of course, this has been against the background of being against the wishes of Member States. Some in this House will want to go further in creating direct supervision, particularly in the area of central counterparties, for example. We all have to caution against adventure over ambition, but let us have proper measured responses when we get to fill in the blanks which will come later.
Financial stability at this time depends upon the years - and sometimes decades - of experience of thousands of nationally-based people who have experience of financial services. They have been the first front line in preventing problems. The national governments have proved that they can also bail us out when it comes to meltdown. However, this has been about fortune rather than design. These new institutions give us the chance to have design. That is what has been missing and that is why it is so important to have it fulfilled.
The agencies do have practical issues involved. We will have a joint committee, which I have been very proud to help champion. The joint committee should be a vehicle for coordination, exchange of information and joint decision taking. It will be the platform for focusing; these agencies work on eliminating systemic risks. We have also insisted on giving the Head of the ECB control over monitoring risk at the aggregate level, but if we have to ask Mr Bernanke whether his reputation was enhanced, I think he might say 'No' about having such powers.
So, avoiding the casino-style financial operations of the past - yes - but being responsible ourselves as regulators, we have to be very measured as well. There should be regulatory ambition, but this is also about people's pensions, their savings, their houses and their jobs. I welcome the supervisory infrastructure that we have. It is young, but it will have to grow up very quickly indeed.
William
Madam President, I should like to ask Mr Skinner on what basis he assumes that the judgment and decisions of new European institutions are going to be better than the decisions taken by regulatory institutions at the national level?
Peter Skinner
Madam President, if the Earl of Dartmouth had listened to my speech, then he would have heard me say that I consider this has to be done in coordination with national authorities, not against their interests - and only done when the legislation that we put forward for such purpose is fit and has passed through the democratic procedures of this House.
I believe that this actually provides the best of both worlds. If you are to imagine that, sitting on your island, a moat alone will protect you from the real issues of the real world, then you are a fool, I am afraid, because the realities are that the global crisis has taught us a real lesson.
Sharon Bowles
on behalf of the ALDE Group. - Madam President, we have made it. The supervisory architecture train has left the station and we are expecting great things from the common rule book. However, our financial legislation is still like a Swiss cheese with holes and carve-outs - places a single rule book will never reach. That is a shame that we will all share until we all really truly subscribe to a single market in financial services.
The new authorities give us an extra dimension to achieve cross-border coordination, but that means extra care has to be taken to make sure that decisions are responsive and taken close to the markets. The ESAs will need to be joined up with one another and with national supervisors and they will indeed have to have fingers in all the pies to make appropriate decisions, mindful that a bad decision is not made better by making it widespread.
Sven Giegold
Madam President, today is indeed a day on which another stone has been laid in the House of Europe. It is a good day, and it proves false all of the claims that, following the financial crisis, nothing would happen. It also proves wrong all those who believe that a new phase of renationalisation is now starting. Instead, Europe is drawing the necessary conclusions. However, it must be made quite clear that this financial market legislation naturally still contains things that must now continue to happen. Parliament has achieved and secured something important. This has already been mentioned. We succeeded because the various forces here in this House worked together and, in so doing, resisted the attempts by many Member States not to take heed of the lessons that can be learned from the crisis.
Some important questions still remain unanswered, for example: how many members of staff will these authorities be given? What would be the point of having these authorities with these new competences if they are not provided with sufficient staff and an adequate budget? What we have heard in this regard is still not clear; we need to work together on this. The next question is: what is going to happen as regards the president of this financial market authority? This is another area where we need to ensure that the right people are appointed. For us as the Group of the Greens/European Free Alliance, an important step was our desire finally to have transparency with regard to the relevant accounting requirements of the large transnational undertakings. In this regard, the Commission has, thankfully, now announced that there will be a communication with regard to the country-by-country reporting. We look forward to this. In this connection, we also look forward to working together.
At long last, we have a joint declaration from four coordinators in the Committee on Economic and Monetary Affairs to the effect that we want the market infrastructures and also the central counterparties to be placed under direct European supervision. There is still more to be argued out here in this regard.
I hope that, on the issue of economic governance, we will get the same level of coherence here in this House as we did on this issue of supervision. Otherwise, Parliament will lose its influence on these issues. We must not allow any re-ideologisation of the debate in this regard. If we do, then the Council will, unfortunately, not take sound decisions according to the Community method.
Kay Swinburne
on behalf of the ECR Group. - Madam President, the legacy of this financial crisis has been a cloud of uncertainty hanging over the financial services sector and our public finances. The banks, the financial markets, governments and corporations are feeling this uncertainty daily, and in order for our economies to show signs of recovery, we need to ensure that this uncertainty is dispelled. One of the main uncertainties since the spectacular failures in the financial sector has been uncertainty regarding regulation, including who will do the future regulating and which institutions will enforce them.
This House has been instrumental in debating this issue and has, over the past few months, discussed the minutiae of regulation and supervision in terms of who, what, where and when. The result delivers balance: balance between Member States' responsibility for supervising institutions and a new European authority setting a common rule book, thereby progressing the single market in financial services whilst elevating the role of peer oversight; balance between safety in the system as monitored by the new ESRB and the need for financial companies to take risks; balance between ultimate protection of the taxpayer and provision of capital to fuel the economy.
We all have a strong interest in establishing new mechanisms to underpin the single market in financial services, including: the monitoring of global risk at our European Banks; ensuring a coordinated and ordered procedure across all Member States in a crisis; ensuring stronger arrangements for mediation between supervisors; and ensuring the enforcement of the rules in all financial centres and by all financial players.
This supervisory package as it now stands delivers the balance required. However, the recruitment of high calibre, financially competent staff will be critical to its future success. I call upon the Commission to ensure that this next step works.
Jürgen Klute
Madam President, first of all, I would like to thank my fellow Members who have participated in rather tough and lengthy negotiations here. It is a tremendous achievement by the rapporteurs and shadow rapporteurs to have managed to do what they have done. They achieved the best result that it was possible to negotiate.
Nevertheless, I do not want to hold back on the criticism that my group has, either. There are three points in particular that we are not happy about. On the one hand, the competences that have been granted to the supervisory authorities are, in our view, inadequate. We would have liked these competences to have been more extensive. We believe it is also wrong for the supervisory authorities to be split over several locations. We advocated combining them as far as possible in one location. That would certainly have made cooperation easier and more efficient. Mr Giegold has already mentioned that the staffing could, and should in fact, be improved in the long term. These are our main points of criticism.
Nevertheless, we believe this to be a right and important step in the right direction, a right and important step towards a new regulation of the financial markets that is urgently needed. However - and this is simply our assessment - we still need to take some further steps in order to arrive at a truly effective new regulation of the financial markets, to get to a point where, through European regulations, we can prevent another crisis like the one we have just experienced. Our group will contribute greatly to this. There are, of course, a few more legislative initiatives on the way. We hope that these will bring more substance to this matter. If so, something truly effective and good could come of this. However, we really do still have a few more steps to take in this regard.
Godfrey Bloom
on behalf of the EFD Group. - Madam President, when last I met the Commissioner, I expressed grave concern that regulation of the City of London was going to move to Brussels. He seemed surprised that I was so concerned, but since he has taken office, he might have come to understand that a significant portion of the United Kingdom's GDP actually comes from its financial services sector.
It is very important to the United Kingdom. Indeed, it picks up most of the tabs. The GBP 45 million a day we send to this place to support the rather suspicious European Union project, which has not given any of our electorate an actual say, is one of those tabs. In fact, you must understand that big salaries and big pensions do not grow on trees.
Commissioner, I also mentioned to you that we could learn something from the old dominions - Australia, Canada - who have not suffered from this problem, and you rather charmingly, and in a very Gallic way, suggested that Australia was a long way away. I hope, now that you have been in office for a little while, you will understand that perhaps such a parochial approach will not do.
I still worry, Commissioner. I still fret that we will have regulation from the usual mishmash of ignorant bureaucrats, parliamentary committees with their usual complement of cryptocommunists, anachronistic socialists, journeymen politicians, fringe greenies, a sprinkling of well-meaning housewives, and grandmothers exploring their new third age. The outcome will be the same as all the other EU projects: fishing, agriculture, energy, employment, immigration and, horror of horrors, the ticking time bomb of the single currency.
It is an astonishing litany, is it not, of failure? You would think the European Union would get something right once by accident. I am sorry, but I am not satisfied. I am desperately cross that the British Conservative Party has given away the City of London regulation. If Dave Cameron had been the Admiral at Trafalgar, it would be Admiral Villeneuve on the plinth in Trafalgar Square now.
Francisco Sosa Wagner
(ES) Madam President, I would like to congratulate those who have worked on this financial package, especially the staff and Members of this House.
It took a financial crisis of huge proportions for Europe to wake up. However, an opportunity has been lost, in part, to strengthen the joint institutions of Europe, because, on the one hand, these new supervisory authorities have a limited scope of competence compared to similar authorities in Member States. Moreover, it is a shame that progress has not been made on similar integration to that which took place with the European System of Central Banks.
We have made progress, but we need to keep climbing the mountain.
Jean-Paul Gauzès
(FR) Madam President, Mr Reynders, Commissioner, I would, of course, like to add to all the congratulations offered and I would like to underline the work done and the excellent collaboration within this Parliament and also to remind you that without the will of Parliament, this supervision would certainly not have had the European characteristics that it has today.
As far as the future is concerned, Mr Reynders, before the end of this period and perhaps even before the end of this month, I would like us to be able to reach an agreement on one of the subjects that concerns us to which you have dedicated yourselves, and not in vain I can assure you. In the coming days, thanks to the great minds of the Belgian Presidency, we will find a satisfactory solution on hedge funds and private equity.
To repeat one of the Commissioner's analogies, I think that we must add bricks to this framework that has just been outlined that will ensure that financial regulation is intelligent and affects all products. It is not about regulation for regulation's sake. It is about trying to ascertain the effectiveness of regulation that is intended to limit as far as possible the risks inherent in the financial system.
In conclusion, I would like to congratulate Mr Wright who regrettably is leaving us. We hope that after all the work he has done to help Parliament achieve results, we will see him again soon on the European way.
Antolín Sánchez Presedo
(ES) Madam President, Commissioner Barnier, Mr Reynders, ladies and gentlemen, I welcome the compromise reached in order to adopt the financial supervision package at first reading and with a broad consensus. European supervision was a long-held aspiration in European integration and an essential instrument for moving forward with financial integration, making monetary policy more effective and improving competitiveness. It was also something that we needed to achieve in order to put an end to the financial hypertrophy and close the gap between global finance and national supervision.
The current crisis has confirmed the insufficiency of the market and of nationally based solutions. We need to correct the defects that have been detected in regulation and supervision. In our case, supervision is a priority in financial reform because, while European regulation has been deficient, supervision has been non-existent.
European supervision lays the foundations for a complete, thorough and credible reform. This first transnational experience is a step towards a consistent system of international financial supervision.
Parliament has worked together to ensure that the package has three focuses. The first focus is that it is more balanced, in order to achieve security and solvency for the financial institutions, financial inclusion and protection for consumers, savers and taxpayers. The second is that it is more prudent in order to respond to systemic risks, act in emergency situations and be able to temporarily ban toxic products. The third is that it is more sustainable, promoting competitiveness, the internalisation of costs and the prospect of a European crisis management system based on contributions from the financial entities.
The Omnibus Directive makes it possible to launch the authorities by incorporating them into sectoral legislation, specifying their powers and setting out rules for how they will operate. It increases transparency in the exchange of information and cooperation and, at the same time, establishes a deadline for reform in the development of legislative implementation to be completed before 1 December 2012 and for transposition to be done with correlation tables.
I will conclude by thanking all those who made it possible for this package to move forward for their work. Today, we are offering the first fruits, but this agreement marks a watershed in the development of European finance and democracy, because democracy means legislating, supervising and ensuring that the laws are effective. It has also been demonstrated that if we want better finances, we need to follow the path towards greater democracy.
Sylvie Goulard
(FR) Commissioner, Minister, many things have been said. The agreement is concluded and it is satisfactory. Thank you everyone.
I wanted to learn from this exercise for the future. The ordinary legislative procedure cannot consist - as was the case with the Economic and Financial Affairs Council (ECOFIN) in December - in concluding an agreement unanimously, and then coming before Parliament saying: 'You know, it is a shame, we have reached an agreement, and furthermore, you must move very quickly because the markets are waiting'. The deadlock was broken, and Minister, we thank you for this, when the Belgian Presidency opted for a little more commitment and dialogue.
I just wanted to tell you that, as far as economic governance is concerned, we intend to work as a team, as we did on supervision. Mr Reynders, if possible, I would therefore like to ask you, like Mr Barnier, to pass a short message to the Commission and to ECOFIN, telling them that we really want to be completely involved from the start and to play our role as regards the ordinary legislative procedure. Do not block us in the Council. Do not block us in the task force, and even try perhaps to explain to Mr Van Rompuy that we would be very pleased to see him in the Committee on Economic and Monetary Affairs, as we asked him to attend.
Markus Ferber
(DE) Madam President, Mr Reynders, Commissioner, ladies and gentlemen, I think that today is a good day, not only for the European institutions, but also for the people of Europe, because we have succeeded, two years after the collapse of the Lehman bank, in creating a structure that, although not eliminating all of the problems that could arise in the financial market, will help to make the excesses that have occurred in the financial market no longer possible in the European Union. We can be proud of ourselves for this.
I would like to express my thanks to the Belgian Presidency, because we had the feeling - and I can endorse what Mrs Goulard said - that the Council was not making much of an effort in this regard at the beginning. Although the Council adopted a unanimous resolution at first, it did not solve the problems. It was thanks to the European Parliament that a solution was found across the group divides which is truly viable and which will ensure that we have stable supervisory structures as well as a range of instruments that can be used in crisis situations to stem excesses and thus help to stabilise the financial sector. I would like to thank you most sincerely, Mr Reynders, as you have personally shown a great deal of commitment to this matter.
However, I would also like to express my sincere thanks to the Commission, which ensured that, in a fair dialogue, the two positions represented by the Council and Parliament, which were very far apart to start with, could be brought together. Thank you very much. That gives us hope with regard to further legislation.
Ramon Tremosa i Balcells
Madam President, the President of the European Central Bank will automatically become the President of the European Systemic Risk Board for the next five years.
This is not a minor issue. It visualises that the ECB is really implicated in the financial supervision of the European financial markets and institutions. It also means that Mr Trichet, who is also accountable in his hearings in this Parliament, will also have to answer questions relating to financial supervision, not only questions relating to price stability.
With this reform, the President of the ECB will risk his reputation and his credibility in achieving effective financial stability in Europe. Thanks to this reform, doing business as usual will be more difficult for the financial institutions that have generated this crisis. It will benefit future generations of European citizens.
Astrid Lulling
(FR) Madam President, I would like to add my voice to the congratulations on the compromise obtained by the European Parliament as regards financial supervision. It is a very satisfactory result, not because this House stood up to representatives of the States. This compromise is really good because it is meaningful. We had to give the package a more European tone for the sake of its effectiveness and credibility.
The reason why Mrs Goulard and I - as shadow rapporteur of my group - fought so hard to ensure that the President of the European Central Bank should automatically be the President of the European Systemic Risk Board is because we are fully aware of the significance of this issue.
In a landscape that will remain very fragmented between national authorities, we need a European body that is strengthened by indisputable competence and legitimacy. Perhaps even the British understand that! By virtue of his authority and prestige, the President of the ECB will be able to impose the authority of the European Systemic Risk Board when faced with its numerous negotiating partners - in the first instance, the Council of Ministers.
Ultimately, it is not excessive power that we should fear; rather, it is excessive weakness that we had to fight, and finally, I would like all the authorities to settle in as quickly as possible and for a climate of confidence to be established between all partners concerned. The bet has not been won. Once again, the European Union was slow to move, but in the end we are laying the interesting foundations for a model that is expected to evolve in the coming years.
Alfredo Pallone
(IT) Madam President, ladies and gentlemen, we are convinced that in the global market, no financial player, product or region may escape regulation and appropriate controls. The recent crises have demonstrated the need to take decisions in 48 hours, and to have common rules.
Banks deemed 'too big to fail' must be supervised at European level. Furthermore, in the event of future crises, the costs must not be borne by the citizens. We must put transparency, accountability and ethics at the heart of the financial system. I applaud the agreement reached in which Parliament played a key role.
My position has always been in favour of creating independent authorities with sanctioning powers and the possibility of intervening in specific cases. I agree with creating two funds, which cannot be designed as a tax on banks: this would not be the answer.
All this is to ensure recovery, to prevent costs being passed on to small and medium-sized enterprises and citizens and, above all, to avoid having a single banking system.
George Sabin Cutaş
(RO) I welcome the shift from fragmented European economic supervision, dictated by decisions made at national level, to a uniform macro-prudential supervision system, which will enable the EU to speak with one voice. The European Union will be able to plan its macro-economic interventions carefully and will have available more suitable tools for preventing a possible financial crisis in the future.
However, it is unfortunate that Member States have disregarded the MEPs' proposal to grant the newly created authorities direct power to supervise the major cross-border banks. We must bear in mind that these banks are one of the main sources of systemic risk.
I also regret that Member States have retained their right to oppose the decisions made by the European supervisory authorities, which could have too great an impact on national budgets. I think that the time for taking small steps is over. Europe's future cannot be established by half-measures, but by total political commitment.
Anneli Jäätteenmäki
(FI) Madam President, we need more European solutions, fewer safeguard clauses and less national egoism. That is why it is particularly important that these efforts do not stop here. We must return to this matter. Crossborder banking, which now accounts for more than 70% of all activities, needs supervision. It requires a common system of European supervision that serves our common interests.
The three new supervisory authorities present us with a solution now, and that is the maximum number for the present. It is not an ideal solution overall, as national interests are still far too disparate when it comes to crossborder banking.
Andrew Henry William Brons
Madam President, ordinary people see crises as disasters; the European Union sees crises as opportunities for gathering power to itself, always at the expense of the power of national governments.
Member States will lose their sovereignty over their own financial systems. Whilst it is true that the crisis in the United Kingdom was handled in a woefully defective way, that is because successive UK governments have not imposed sufficient control over the activities of their private banks.
Banks are not ordinary businesses that are best left to themselves. They are the creators of credit, a large part of the money supply - and that cannot be left in the hands of unregulated private business.
Burkhard Balz
(DE) Madam President, in my opinion, the compromise negotiated today represents a milestone in the continuing development of Europe-wide financial supervision. This joint success was made possible in particular by the constructive way the negotiations were conducted by the Council Presidency and by the cooperation of the Member States, which had previously drawn red lines, indeed, dark red lines, in this regard. We have not just created a toothless tiger, but agencies that are also able to bite at the crucial moment. In crucial situations in future, there is to be no more bickering among the national supervisory authorities over powers, but a clear, binding statement from a European authority. Finally, in emergencies, the decisions will, in future, be taken by European institutions. That means more responsibility.
What seems to me to be of particular importance is also the fact that the European Systemic Risk Board will be chaired by the President of the European Central Bank. With regard to the content-related points that have already been mentioned, I agree with the rapporteurs and I would like to express my thanks for the excellent cross-group teamwork.
Michel Barnier
Madam President, at the end of this debate, I would like to thank each of the rapporteurs, group representatives and MEPs who spoke, almost unanimously, in favour of supporting this compromise and this agreement.
I would like to confirm that these new European authorities and the European Systemic Risk Board will not replace national supervisors, but rely on them and make them work better together, ...
(The President calls for silence)
... put them into a network, pool competence and expertise to have a good European response when it is necessary, faced with European risks and sometimes more, in financial establishments which, as I told you, are largely transnational.
This framework will exist thanks to you and the Council. As has been said, we will fill it brick by brick: the payments system as per the Single Euro Payments Area, from October, the regulation on bank capital, the review of the directive on market abuse, undertakings for collective investment in transferable securities for depositaries, rating agencies, risk management and finally, corporate governance. That is what lies ahead of us, not to mention the regulation of investment funds.
We will carry out this work with determination. We will do it so that at the end of the road, as I told you, ladies and gentlemen - and it has been our road map since the G20 - no financial player, no product, no market or any territory will remain immune or excluded from intelligent regulation and effective supervision.
Ladies and gentlemen, our ambition, my ambition, should be that together, at the end of this road that is short, because citizens are watchful and demanding as they have every reason to be, we will have built the world's best system of regulation and supervision before it is too late. It is Europe's duty to have the ambition to build the necessary model of regulation and supervision in the world. That is our objective and it is in the interests of citizens, consumers and the financial industry itself.
Didier Reynders
Madam President, honourable Members, I would, in turn, like to thank all of the speakers and the very large majority of you who have supported the texts put to your vote. Furthermore, I am very pleased to see the interest that many MEPs have shown in this subject and in financial supervision.
First and foremost, I would like to tell you that, as several people have reminded us, it is a question of the first real lesson learnt from the financial crisis. We have had much debate on a large number of texts, but the implementation of the new supervision package and the European Systemic Risk Board is really the first lesson that we in Europe are all learning together from this financial crisis.
The second element that I would like to underline is that it is a question of the beginning of a process. As Mr Barnier has just mentioned, we are going to implement a whole series of other elements within the framework of this process. Regulation must continue to be strongly reinforced and several people have referred to this. In the same way, we will pursue the work between the Commission, the Council and Parliament. The Belgian Presidency is, in any case, utterly determined to be involved in the same way.
I hope that in the next few days, we will really be able to move forward as far as the directive on investment funds, hedge funds and other investment funds is concerned. Soon, we will hold debates on rating agencies. I would like to reassure you of the collaboration that Mrs Goulard referred to. We have already proposed, and all of this has been agreed, that during the informal Economic and Financial Affairs Council, Mrs Bowles, the chair of the Committee on Economic and Monetary Affairs, will join us to take stock of the state of progress of our work.
I do not wish to speak any longer because I know that there are important procedures that will take place, but I really hope that we will be able to help in what many have described as an historic vote. In any event, I will see you in the next few days and weeks to promote, in the same way and with the same determination, some other texts that once more will be put to you.
Thanks anyway to those who have done what they could over the last few months to move forward with this dossier which, as I said, is really the first important lesson learnt from the financial crisis.
President
The debate is closed.
Written statements (Rule 149)
John Bufton  
in writing. - Brussels are now totally in control of banks, stock markets and insurance companies, yet what was supposed to be supervisory has escalated into powers that stretch much further than the advisory nature of current systems, leaving national bodies without power or purpose. If Brussels were viewed as over regulating banks and stock markets, financial services would face two options - fall behind international competitors or move their headquarters to countries free from any limitation whatsoever. The former would keep European investors stuck in the dark ages of recession as the rest of the world takes huge strides out. The latter could lead to a cowboy banking market overseas beyond reach where everybody's money would be at risk. The majority of EU regulation in other sectors has been an unmitigated disaster. We have put the city of London, one of the UK's largest industries, responsible for 80 per cent of European hedge funds, into the hands of the Commission. If this follows the rest of Brussels' erroneous lawmaking, the UK, and the rest of the world, could rue the day such a power transfer was allowed to take place.
Giovanni Collino  
We cannot allow European citizens to pay the price for the failure of a banking system which, until now, has done anything but safeguard their rights. We also cannot allow our economic system to buckle under the weight of reckless access to credit.
My colleagues from the Committee on Budgets and I have ensured that the rules governing the functioning and funding of the new monitoring and financial supervisory authorities are appropriate and balanced, in line with a European budgetary policy that must take into account the difficulties that all the Member States are facing. On the other hand, these difficulties would be much worse if the EU did not bear the burden of preventing another crisis similar to the one we are still experiencing today.
The beneficial impact of each new agency will balance out, more than proportionally, the costs which must be borne for their initial creation and their subsequent functioning. The European Parliament and the Group of the European People's Party (Christian Democrats), which led the negotiations brilliantly, reaching an historic agreement with the Council, will both represent the spirit of a change which, for taxpayers, will mean being able to depend on a Europe that is closer, a Europe that is more prosperous, and a Europe that is safer.
Ilda Figueiredo  
It is only some two years after the onset of the severe financial crisis that the Council and Parliament have reached agreement on a package of what they call 'financial supervision' measures, but which, in fact, have been pared down to a minimal degree of intervention in this sector. Moreover, they have done so without first making the fundamental, basic decisions in this area, namely, to put an end to tax havens, to levy a tax on capital movements and to close the derivatives market. Nor do they propose making the European Central Bank more democratic or radically altering its objectives in order to prioritise jobs with rights and, at the very least, to seek a balance between social progress and public finances.
That means that the main financial speculation mechanisms remain in the market and that the measures taken now are aimed more at facilitating control by the major powers and their financial groups over Member States with more fragile economies than at tackling the issue of financial speculation head-on and stamping it out.
Moreover, we must not forget that this package forms part of the measures adopted by Ecofin for prior checks on national budgets, included in the so-called 'European Semester'. That merits our strongest protest.
Iliana Ivanova  
Today's debate on financial supervision indicated that most of us have the will and determination for serious reforms in the area of economic governance for the benefit of Europe. The most effective method against crises of any kind is prevention. Today's approval of the reports on the independent European supervisory bodies means that this is precisely what we are investing in - a better basis for effective supervision of financial and non-financial institutions, which will guarantee in the long term greater and more stable security for the financial system, while reducing significantly the likelihood of future crises. I would like to thank all the rapporteurs and I am pleased that the European Parliament strongly defended its positions on the independence and powers of these supervisory bodies and turned them into systems for actually improving currently existing regulations. For this reason, we must all defend to the hilt the interests of the European citizens whom we represent, guaranteeing a suitable framework for risk management during crises.
Justas Vincas Paleckis  
in writing. - The European Parliament has always talked about the need for a single voice for Europe on the international stage. The uniquely European financial supervision package is one of the steps in this direction. With the package in place, Europe of the 27 would finally be able to work more coherently and with more solidarity within the framework of economic governance decisions taken at global level. More importantly, the only way that Europe can reduce systemic transnational risks and subsequently prevent or mitigate the negative impact of future financial crises is to have an integrated network that funnels and coordinates the expertise and efforts of actors of all levels to establish and maintain a sound, stable and transparent financial system. Such a system serves as a prime example of the accountability of Europe to its citizens. I support this package because I believe in the future of Europe - a Europe where our financial industry no longer needs to suffer from its own excesses, and where our citizens no longer need to suffer from the devastating, unnecessary consequences of preventable crises.
Theodor Dumitru Stolojan  
I congratulate the European Commission, the Council and European Parliament for adopting the regulations on the supervision of financial institutions and markets. European citizens needed to know that in future, those types of financial speculation where speculators consider it normal to claim for themselves the profits which have been made, while losses are covered by ordinary taxpayers, will be prevented. I also ask the Commission and Council to focus on the following issue arising from the efficient operation of the European economy: how can most industries be achieving low levels of profitability or verging on losses, while the banking sector is reporting increased profits again, following the crisis?
Nuno Teixeira  
The weaknesses of financial regulatory and supervisory bodies around the world gave rise, to some extent, to the difficulties that we have been experiencing in the European Union and the euro area. The need to activate plans to bail out the economy and families was a decisive factor in the marked increase in government deficits.
The package we are debating today is the concrete result of a new financial supervision architecture in Europe, based on the creation of institutions and mechanisms designed to provide both macro-prudential supervision - that is to say, supervision of risks affecting the entire European financial system - and micro-prudential supervision of banking, insurance and the property markets, in coordination with the network of national supervisors.
There are also other areas where it is hoped that the European supervisory authorities will contribute to financial stability, in particular, by centralising in one institution the supervision of EU-registered credit rating agencies, the promotion of mandatory technical standards and the mediation of conflicts between national supervisors.
Additionally, this new supervisory architecture may also contribute to the success of new Union mechanisms for economic, budgetary and social planning, coordination and supervision within the European Union.
Marianne Thyssen  
Madam President, this historic agreement was only possible thanks to the excellent work of the Belgian Presidency, which supported Parliament's approach and scored a success where some other Presidencies had failed. True to the key elements of the Larosière report, the European Parliament has secured sufficient clout for the new European supervisors. They will be able to impose binding measures on financial institutions where national regulators fail to take adequate action, provide greater alignment between national authorities and settle their mutual disputes.
Fortunately, with this agreement, we have been able to go much further than the non-committal coordination between national watchdogs that many Member States initially preferred. In the meantime, we have witnessed what a lack of European supervision can lead to. The new supervision structure will better protect not only the bank's customers but also the taxpayer.
However, there is a downside to this agreement. I regret that Parliament's call for the supervisors to be headquartered in one place, in Frankfurt, close to the European Central Bank, was rejected. Fortunately, Parliament was able to incorporate a review clause, so that in three years' time, we can assess whether or not the European supervisors require more powers and whether or not dispersal of the authorities is appropriate.
Winkler, Iuliu  
in writing. - The decision on the financial supervision package constitutes a truly crucial response, proof that the EU has understood at least some of the lessons of the crisis. The creation of the supervisory authorities is a major step towards European integration and the furthering of the single market.
Now, the implementation of this new architecture begins. It is true that the new supervisory authorities will act in a coordinated manner, together with the national supervisory bodies, and not by replacing them. But it is equally true that the fragmented response of the Member States during the financial crisis prevented the EU from showing more efficiency, more coordination and more leadership.
So it is quite obvious to me that advisory powers and non-binding recommendations are not enough. Binding rules, harmonised application and coordinated supervision are needed for a more efficient single market. These are the requirements that have to be fulfilled by the new ESAs to constitute the institutional foundation of the new European financial supervision architecture. The same requirements are necessary to best serve the interests of European taxpayers.
President
Good afternoon, ladies and gentlemen. I can see among us a very young person, just a few days old: little Vittoria, Mrs Ronzulli's daughter. I would like to extend my best wishes to both Mrs Ronzulli and her daughter on behalf, I believe, of all Members of this Parliament.
Licia Ronzulli
(IT) Mr President, ladies and gentlemen, I have brought my daughter with me today as a symbolic act, and my thoughts are with the many women who, owing to work-related issues, are unable to enjoy their pregnancy, reconcile work with family life, or worse still, be the best mother they can be.
In this regard, I would ask for greater efforts by the European institutions, starting with Parliament, so that no woman is faced with making such a choice.
President
Congratulations once more, and we support your heartfelt appeal.
We shall now proceed to the vote.
