Outcome of the summit of 7 May 2010 and the ECOFIN meeting - What is the political relevance of the EU 2020 strategy in the context of the current financial and economic crisis? - Consequences of the financial and economic crisis on the EU 2020 strategy and its governance - What is the relevance of the EU 2020 strategy in the framework of the current financial and economic crisis? (debate) 
President
The next item is:
the joint debate on mechanisms for strengthening economic order,
the Council and Commission statements: Outcome of the summit of 7 May 2010 and the ECOFIN meeting [2010/269(RSP)],
the oral question to the Council and the Commission: What is the political relevance of the EU 2020 strategy in the context of the current financial and economic crisis? - B7-0213/2010), - B7-0214/2010),
the oral question to the Council: Consequences of the financial and economic crisis for the EU 2020 strategy and its governance - B7-0301/2010),
the oral question to the Council and the Commission: Political relevance of the EU 2020 strategy in the context of the current financial and economic crisis - B7-0219/2010), - B7-0220/2010).
Diego López Garrido
Mr President, everyone is aware that we are living in a period of exceptional financial turbulence. This has been the case for a few months, and the origin does not go back a few months, but a few years, when the subprime crisis occurred in the United States.
The origin was, therefore, a financial crisis in the private sector of the financial system, which rapidly became something that was affecting the real economy in the form of a deep depression, which, technically speaking, was a deep recession. This involved a decline in production and a significant increase in unemployment, which was particularly serious in those countries in which the property or residential construction sectors had a significant influence.
There was an immediate reaction from the Member States and the central banks in order to prevent the financial system from collapsing, and there was also a reaction in relation to the real economy.
This reaction, of course, had consequences for public economies and public finances. We are now no longer talking about private finances, but about public finances. Firstly, there was a crisis of financial stability in public accounts as a result of very marked deficits.
There was also a crisis in sovereign bonds. This is what has been coming to the surface in recent months, encouraged by the actions of very volatile markets which, at times, have even been clearly speculative. These actions have also caused a significant rise in the interest that the markets require from the Member States when they are going to issue bonds. Moreover, this clearly affected the whole of the euro area, and therefore became a problem affecting not one, two or three countries, but the stability of the whole of the euro area.
That is the situation. Those are all the events, or the diagnosis of the facts that the European Union has taken into account in order to react and act in response to this, and I feel that the EU has acted correctly throughout this period. It may have appeared slow to take decisions. It may, at times, have seemed to be exasperatingly slow to take some decisions, but it has achieved the right results, the results of prudent action by the EU and, more importantly, coordinated action by the EU.
Although it might appear that various measures prevent us from seeing the whole, I believe that the EU has established an appropriate strategy for the circumstances, which has to include some short-term measures and look more towards the medium and long term, as it is about preventing such a crisis from occurring again.
As we have already said, the short-term measures involve an injection of public money and coordination by the European Union: what is known as the European Economic Recovery Plan, backed by the Commission; a plan that coordinates this immediate action, this shock treatment that the Member States are adopting in order to limit the damage done by this huge crisis, but not make it disappear.
One manifestation of this short-term action is undoubtedly the aid to Greece, which had already been warned by the Commission months before about a difficult situation in its public accounts. The Council is making a series of recommendations to Greece in relation to Article 126(9) of the Treaty on the Functioning of the European Union, and the Council and the Commission are monitoring developments there.
Not only are recommendations being given in relation to the liquidity of its public accounts, but also regarding structural reforms in the pensions system and the need to undertake reforms in the health system. Then came 23 April, when an action mechanism was adopted regarding Greece. Yesterday, this mechanism was manifested for the first time in funds being sent to Greece by EU countries through the system of this agreed mechanism.
This is therefore the first expression of this short-term action, which is essential when a Member State is in serious difficulties, as is the case with Greece.
Naturally, also in the short term - and this was expressed very clearly in the oral question put by Mr Daul, Mr Verhofstadt, Mr Schulz and others - we need to have a strategy to get us out of the crisis. It needs to be a measured, controlled strategy and, of course, it needs to be aimed at avoiding the very serious difficulties in public accounts, but it also needs to maintain the objective of growth.
However, obviously a short-term strategy is not enough. We need to take medium and long-term measures. There are structural problems in the European economy; structural problems that were ultimately responsible for weakening Europe in the face of a highly volatile situation of extreme financial turbulence.
The European Union is taking and suggesting measures in the medium and long term that it is important to point out. This is firstly the case because they are going to respond to the type of crisis that occurred as a result of this serious economic situation affecting the whole of the EU and, in particular, the euro area system. In order to be able to respond to the crisis in the financial sector, the European Union has planned a series of measures that are being debated in the next few days in Parliament: a supervision package, which I hope will be adopted as soon as possible. I also hope that the Council and Parliament will reach an agreement in this respect. As part of this package, or in relation to it, the Economic and Financial Affairs (Ecofin) Council adopted a measure yesterday: the regulation of hedge funds, alternative funds or high-risk funds. I refer here to the question by Mrs Harms and Mr Cohn-Bendit, who place a great deal of emphasis on this aspect.
The perspective of action in the G20 also needs to be taken into account, also implementing what has been agreed in the G20.
Likewise, we have said that the European Union has structural weaknesses and that structural reforms are needed. The Europe 2020 strategy aims to do this, and it is based on the commitment of the Member States to tackle certain objectives through a series of integrated guidelines. These guidelines are also going to be accompanied by national plans, which will be designed in what are known as the reform plans. It should also be said that, along with the Europe 2020 strategy, the action that the Commission is adopting in relation to the whole of the production system is also important. In its communication on 12 May, it proposed the coordination of economic policies.
The Europe 2020 strategy is therefore a way of responding to the underlying problem in the productive economic system, preventing these fundamental weaknesses in the system in the future and making the Union's economic system competitive and productive. It is also a way of aiming towards the objectives of technological added value, taking into account the social impact and therefore the need for specialisation in the labour market, employability and also combating climate change.
There is not, however, only a problem with the private financial system, with the productive structure, and essentially with the private sector: there is a problem with public accounts, which is also the focus of another aspect of the EU's medium and long-term measures. These are the measures in the Commission's proposal of 12 May, which the Ecofin Council began to debate yesterday and will continue to debate. These measures are aimed at maintaining budgetary discipline, guaranteeing compliance with the Stability and Growth Pact and establishing measures to resolve and prevent crises.
With this in mind, a task force has been created, which is going to meet for the first time this Friday, 21 May, chaired by President Van Rompuy. Its objective is budgetary discipline and it will be using the Commission document on coordinating economic and budgetary policies presented by Commissioner Rehn.
This relates to all the more long-term measures, in which we also need to include the debate that is beginning in the EU about tax on benefits in the financial sector and a tax that even the G20 is beginning to talk about, which is a tax on financial transactions, which is, in turn, being debated in the EU. This is something that Mrs Harms and Mr Cohn-Bendit emphasise in their question.
On this subject, it should be said that all the European Union institutions are working towards this. It was discussed at the European Council in December of last year. The International Monetary Fund was given the task of conducting a study on a tax on international financial transactions. It was discussed in the European Council in March, the Commission proposed it on 1 April, and it was also discussed in the Ecofin Council.
This is, therefore, another measure that will undoubtedly be discussed at the G20, and which is of the utmost importance; these are what I have called the medium- and long-term measures proposed by the EU. Yesterday, for example, at the EU-Latin America Summit in Madrid, a reform of the financial system was also proposed. In other words, the European Union is raising these issues in all the forums that it attends.
In short, Mr President, the steps are being taken and the conditions are in place to move towards what has been described as economic governance of the Union. The European Council is playing an active role in this, along with the Commission and Parliament as the legislative and controlling body.
So I think we can say - to conclude, Mr President - that it is true that the crisis has clearly demonstrated the shortcomings of the European monetary union in the absence of economic union, something that is provided for in the treaties but does not exist in reality. We have remained in monetary union, but we are not moving on to economic union. These measures adopted in the short, medium and long term by the EU are clearly taking the Union along a path towards economic union.
This crisis has weakened our economies and put the Union to the test, but it has not destroyed it, it has not fragmented it. The European Union has responded and, at times, we have felt that it has done so slowly, but it has acted surely. At times, it seems that it has been hesitant, but it has been united, and its response has been correct and appropriate to the challenges that we face at the moment.
I hope that the European Council in June will consolidate this move towards European economic governance, towards a united reaction to this crisis from the EU. I therefore also hope that it will adequately prepare the EU's common position for the extremely important G20 meeting in Toronto on the regulation of the financial system and for the important debate on taxing international financial transactions.
Olli Rehn
Member of the Commission. - Mr President, I welcome this debate on the crisis response of the European Union and on the immediate and longer-term challenges of economic governance we are facing. I shall start with the immediate challenges and the crisis response.
Ten days ago, the European Union took bold and necessary decisions to safeguard financial stability in Europe. It was a dual response to the aggravated crisis, which had turned into a systemic challenge to the euro. It was a response that I would call a consolidation pact.
First, we agreed on a European financial stability mechanism that provides a financial backstop for up to EUR 500 billion, which will be supplemented by IMF funding at a ratio of 2:1. Secondly, we agreed to accelerate fiscal consolidation in those Member States where it is most urgently needed.
With these decisions, Europe came up with a credible package that shows our citizens, the markets and the wider world that we will defend the euro - our common currency - whatever it takes.
We are not doing it for the sake of the mystical market forces but for the sake of sustainable growth and job creation in Europe, by ensuring that the threats to financial stability will not kill the economic recovery that is now in progress - though this is still rather modest and fragile. This is our responsibility in relation to our citizens, and we are delivering in very concrete terms. Yesterday, coordinating and managing on behalf of the euro area Member States, the Commission delivered EUR 14.5 billion for Greece, which the IMF has complemented with EUR 5.5 billion. We said we would be ready to meet the immediate needs of refinancing, and we delivered on time.
Of course, this is all conditional on a full and complete implementation of the programme designed, together with the Greek Government, by the Commission, in liaison with the ECB and the IMF.
The European Central Bank has also taken extraordinary measures to tackle the attacks we have recently seen on the euro. Beyond that, our Member States have understood the paramount importance of fiscal consolidation to ensure the sustainability of public finances and thus, preconditions for sustainable economic growth.
Last week, Spain and Portugal presented significant new fiscal consolidation measures which are important and difficult but, at the same time, are necessary steps in order to reduce the ballooning public deficits in 2010 and 2011. The Commission will present a comprehensive assessment of the adequacy of the new targets and measures in the course of the next two weeks.
Let me underline that a faster reduction of the public deficit is indeed an essential component of the financial stability package that was agreed on 10 May by Ecofin. It is equally important that both countries adopt structural reforms that will contribute to increased potential growth, especially reforms of the labour markets and pension systems.
While accelerated fiscal consolidation is an immediate priority throughout Europe, at the same time, we need to coordinate our economic and fiscal policies by applying differentiation among the Member States. In other words, the efforts of fiscal consideration need to be differentiated according to fiscal space and economic vulnerability.
Countries with little or no fiscal space will need to front-load and accelerate measures, while others with better fiscal space should maintain their less restrictive fiscal policy stances for the sake of growth and jobs in Europe.
Of course, it would be a mistake to stop our efforts here. Let us recall that the first 10 years of the euro have been a success story: that is the starting point. But the crisis has shown that we need to acknowledge its systemic shortcomings. Peer pressure has lacked teeth, good times were not used to reduce public debt, and macro-economic imbalances were ignored.
This is precisely the reason why last week, on 12 May, the Commission presented an ambitious set of proposals to reinforce economic governance in Europe. We want to strengthen preventive budgetary surveillance, address macro-economic imbalances and set up a permanent and robust framework for crisis management. I count on Parliament's support for these important proposals. They are at the heart of making Europe 2020 a success in the coming years.
Our proposals are based on two principles. First, prevention is always better than correction - not to mention letting a situation escalate into a crisis, as we have seen. Second, stronger fiscal surveillance should be accompanied by broader macro-economic surveillance, to go to the roots and origins of sustainable economic development.
Our proposals are made of three building blocks. First, we must reinforce both the preventive and corrective arms of the Stability and Growth Pact. The essential cornerstone of reinforcing economic governance is to coordinate fiscal policy in advance, in order to ensure that national budgets are consistent with the jointly-agreed European policies and obligations, so that they will not put at risk the stability of the euro area as a whole and that of the other Member States.
Let me be very clear about this: this will not mean scrutinising national budgets, budget line by budget line. We have neither the intention nor the resources for that. Instead, it will mean analysing and peer-reviewing the broad budgetary guidelines and fiscal balance before the submission of the draft national budgets by governments to Parliament with the legal right, based on the treaty and pact, for the EU to make recommendations and ask for corrective action from the Member States concerned.
Some have criticised this, saying that this is a breach of parliamentary sovereignty. I myself am a former member of a national and the European Parliament, and I am fully aware of the sensitivities of parliamentary fiscal powers. However, everyone can see that this is not about breaching democracy or parliamentary sovereignty but ensuring that our Member States respect those very same rules which they have themselves decided on previously: in other words, to practice what you preach.
We need to introduce a truly European dimension to economic policy making in Europe: it is not enough to look only afterwards at international decisions. In the EU, in particular in the euro area, we know only too well that national decisions have an impact beyond national borders, and therefore there will have to be coordination at European level before those national decisions.
The second building block is to go beyond budgetary surveillance to broaden and deepen surveillance, to address macro-economic imbalances. Why is this important? The divergences in competitiveness and the gap between the surplus and deficit countries of the euro area has widened in the past 10 years. This has been at the root and origin of why the financial crisis hit the EU so hard, especially some of our Member States. We should prevent and tackle emerging problems before they escalate into a crisis.
Therefore, we propose to define indicators and a scoreboard, agree alert thresholds and give recommendations and early warnings if necessary. These indicators could include, for instance, productivity trends, unit labour costs and current account developments.
It is self-evident that this does not mean that we would want to weaken the export performance of any country; of course not. Instead, it aims at rebalancing economic growth in Europe as a whole. We need to reinforce export competitiveness where needed and domestic demand where needed and possible. That is the way to play as a European team for the benefit of the whole of Europe.
Thirdly, we need to be very clear to whoever is watching the euro area that we will never be defeated. To discourage anyone from even trying our vigour, we need a permanent and robust framework for crisis management for the euro area Member States. The temporary mechanism established on 10 May is a bold first step in that direction, but for the medium to long term, the Commission will propose a more permanent mechanism, subject to strict policy conditionality and, of course, drawing on the lessons of recent experience. Yes, we need to avoid moral hazards. That is why we must make the mechanism so unattractive that no leader or country is voluntarily tempted to resort to it. But recent experience has shown that it is better to have a fire brigade ready for a possible bush fire than only start building the fire brigade up when the fire has already turned into a broader forest fire. It is better to be safe than sorry.
To conclude, these Commission proposals pave the way for a quantum leap in economic governance in Europe, but I also want to draw your attention to another immensely important decision - on the same day we proposed these measures - namely, the proposal for Estonia to become a member of the euro area on its own merits. Just to give you one figure: while the average debt in Europe is, at the moment, around 75%, in Estonia it is around 7.5% - not 75% but 7.5% - on a sustainable basis.
This proposal sends an important signal to all that the euro area will withstand pressure with self-confidence, and sustainable economic and fiscal policies will bring fruit for Member States. All in all, the Commission's initiatives, once adopted, will lead to a substantial deepening of economic governance in Europe and to a prudent widening of the euro area. Indeed, in the EMU, it is high time to fill the 'E' with life.
Joseph Daul
Mr President, ladies and gentlemen, Europe has finally reacted. The Heads of State or Government have finally begun to deal with the problems by deciding, 10 days ago, on a support plan for our currency, the euro. This is a plan which accurately reflects the scale of European solidarity, thus contradicting all those who doubted it, but which is still inadequate and must be accompanied by measures to reduce our national budget deficits and measures for obtaining agreement among the 27 on the social and fiscal budgets. I think everybody is saying this this morning, and we have all been saying the same thing for the past fortnight. Well let us do it now! This plan was completed last Wednesday with the Commission's decision, which I welcome, to radically enhance supervision and the implementation of a stability pact.
Ladies and gentlemen, we will not extricate ourselves unless all these measures are implemented. We will not extricate ourselves unless we have political courage, because the measures that we should have already taken collectively at EU level and individually at national level will have to be taken now. This applies to both right-wing and left-wing governments. I am very sorry that the German socialists were lacking this courage when they voted in the Bundestag on the European aid plan.
We must learn lessons from all this. The first lesson: we must know the true state of national public accounts, just as we know the true state of EU public accounts. I am asking the Commission to strive to ensure this and to punish, and not just timidly criticise, any State which fails to meet this obligation. As you well know, everybody is afraid of the speed trap, everybody is afraid of the penalties, of the number of points on their licences when they are on the road. This is how we are made, so there have to be penalties. This is the alpha and the omega of any serious policy in this area.
Second lesson: the 27 must concentrate on their budgetary policies very early on in proceedings. The Commission asked for this last week. I myself asked for it in this Chamber a few weeks ago. I know that it irritates Member States when we ask them to concentrate, but they must get used to being irritated from now on if they continue to treat their public finances as if they were living on a desert island, as if they were not connected to one another by a currency and, hence, by a necessary common discipline.
Moreover, what is true of national budgets is also true of social and fiscal policy. Once again, I understand the anger of some of our compatriots when they are asked to make sacrifices for others who work less and retire earlier. This cannot continue either. That is the third lesson which I have learnt from this crisis. The euro will only be viable if we collectively give ourselves the resources to make it so. I would not contradict President Obama's financial adviser, Mr Volcker, who said that the euro is liable to collapse if we do not change our culture and behaviour. We must look beyond national considerations and towards European considerations. We must move on from short-term policies, designed to prevent our national governments from falling a few points in opinion polls, to medium- and long-term plans, which are also being demanded by our entrepreneurs so that they can invest and recruit.
My group is asking Europe to wake up. It is asking for the Commission to do its job, which is to apply the carrot and the stick technique with Member States. Financially reward the ones that clean up their public finances and punish the ones that refuse to do so!
The Commission, Mr Rehn, must not be afraid of doing this. It would be to the benefit of Europeans and of Member States. The main problem amongst our fellow citizens, which is raised at all our meetings at the moment, is whether their savings are still safe. I understand these citizens, who have worked all their lives to have a few savings. So that is the first assurance we should give them: that their savings are protected. That is quite simply what the Commission must do; it was created for that purpose.
It is only in this context, ladies and gentlemen, that the 2020 strategy will have any meaning. It is only if we are once again serious of purpose, if we act collectively with regard to public accounts, that we will be able to win the battle of unemployment, education, training, research and innovation. I said this yesterday, and I say it every day: if savings have to be made in all our Member States, then we too, as Members of Parliament and European civil servants, will have to lead by example, or else we will lack credibility.
That is all that I have to say, and I am still hoping - I have experienced a few very serious and very deep crises - that this crisis can at least serve as a new starting point for Europe and its citizens.
Martin Schulz
Mr President, ladies and gentlemen, this debate is taking place against the backdrop of a very serious situation which represents a threat to the European Union. We have decades of laissez-faire ideology behind us and these have been decades during which anyone who questioned the alleged superiority of the capitalist economic system was ridiculed. This economic system has taken us into the deepest financial, economic and employment crisis and the deepest crisis in the morality and legitimacy of the institutions since the end of the Second World War.
The system is wrong. It is, to a certain extent, immoral, and it is also warped. I would like to give you an example, because many of our citizens do not understand the jargon that is used. What is the trade in credit default swaps and credit default insurance all about? It means that you can take out an insurance policy which can then be bought and sold like a commodity. Let me put this in practical terms. I am sure that the lovely farm owned by Mr Daul is covered by a fire insurance policy. If I, Martin Schulz, can buy Mr Daul's fire insurance policy and if I receive the insurance payment instead of him when his house burns down, then I simply need someone, for example Mr Cohn-Bendit, who is prepared to set light to the house and I am a made man.
This is a warped system. It should be abolished and these practices should be banned. These are exactly the mechanisms that we are discussing and the real-life examples are not funny. One concerns the pension fund of the Californian teachers' union which wanted to buy a German airline via a hedge fund. The pension fund did not succeed, but it bought something else instead. However, the pension fund then went bankrupt. This has brought ruin to a whole generation of teachers, who have been paying into the fund for 40 years. That is the reality of this economic system, which has now reached its limits and which must be put on a tight leash.
Now it is the governments' turn. This is what you have said, Mr López Garrido and Mr Rehn. That is all well and good, but we are the ones who are reacting, we are the ones who have been driven to action and, in my opinion, we are reacting far too late. Regulations should have been introduced in many areas at a much earlier stage and we have often called for this to happen in this House. Now we are bringing in regulations for hedge funds, but when will the European Rating Agency be established? Is it really normal for an American rating agency, at exactly the point at which the speculation against Greece reached its climax, to set its sights on the next target and lower Portugal's rating? What type of institutions are these which can decide on the fate of entire nations? They must be controlled and regulated. However, this should not be happening now. It should have taken place years ago and we called for it years ago, but our calls were rejected. They were rejected by the same governments which today claim to be managing this crisis.
(Protests)
Mr Langen, I know that you are tabling an amendment this afternoon to ensure that Parliament is not in session during carnival time in Germany. That is a good thing. It is just that when you are here, it is carnival every day that Parliament is in session. I am really sorry.
We have structural deficits in the EU, which the institutions are responsible for resolving. We have allegedly created an economic and monetary union. However, the reality is that we have a monetary union, but not an economic union. In Europe, we have a patchwork quilt of economic policies. A total of 16 sovereign states are failing to coordinate their economic policies, some of which are inconsistent with one another, within a single currency area. This represents a huge risk. Arnold Schwarzenegger and his beautiful state of California are completely bankrupt, but that does not affect the dollar at all, because the economic policy of California forms part of the single currency area of the United States. If 2.8% of the gross domestic product of the euro area is put at risk, as in the case of Greece, a serious crisis will be caused here. We must get rid of this deficit, which is why we need economic governance. Anyone who is still opposed to this has not heard the warning shots.
We are in the middle of an extremely serious crisis of legitimacy. People are realising that this economic system has failed and they no longer have any confidence in it. They have seen that the national and international institutions are being driven by this system and therefore they no longer trust the institutions either. During this phase, many people are returning to the refuge of national rhetoric in the face of this globalised, Europeanised challenge. This three-way contradiction between the crisis of confidence in our economic system and in our state institutions and the retreat of many state institutions into taking a national approach, rather than looking for solutions in the international structures, is a mixture which puts the EU as a whole at risk.
Therefore, we need economic governance and we also ultimately need the strength to implement our own regulations. Finally, Mr Daul, who is the chair of the group which includes the representatives of Nea Dimokratia, should be a little more restrained in his criticism of other parties.
Guy Verhofstadt
Mr President, I do not think that either nationalist or Marxist rhetoric is going to provide us with the solutions we need for this crisis we are going through.
(Applause)
What we are currently experiencing, Mr President, is not, in my opinion, a monetary crisis in the Union, it is not even a crisis of our single currency; rather, it is a crisis of EU governance. This is the situation we are in at the moment. I would even go as far as to say that it is a crisis borne of the Member States' obsessive belief that they can solve Europe's problems with their intergovernmental approach, when a monetary area, Mr President, must be governed by a single method, by the Community method, on the basis of the European interest, and not by a syndicate of national interests, which is what the European Council and the Council of the European Union, by their very nature, represent.
For my part, I therefore have three messages to send out this morning in this debate. The first message, Mr López Garrido, is addressed to the Council. We could perhaps ask the Spanish Presidency to invite the Members of the Council to show a little discretion in relation to the euro crisis, because each time a solution is found to help the euro, one or other Head of State or Government is compelled to come forward to say his piece, and to sabotage, in fact, the solution that has been found. I therefore think that the first thing that the Council must be asked to do is to be a little bit more discreet and to let the Commission and the European Central Bank come up with solutions.
My second message is for the Commission. I believe, Mr Rehn, that you took some brave decisions last Wednesday which are a step in the right direction, but that the Commission must go further. For the time being, then, we have a working group. This Council working group will meet to put forward solutions around October time or towards the end of the year. In my opinion, this is much too late. It is up to the Commission, which has the right of initiative, to put together an ambitious overall package over the coming weeks and months. That is what must be done. We must not wait for a working group of the Council to tell us what must be done; it is up to the Commission to take this initiative. It is up to the Commission to draw up a comprehensive package, which it will present to the Council and Parliament, and which will comprise, in my view, four elements.
Firstly, strengthening the Stability and Growth Pact. This means, in fact, penalties; I personally am in favour of Mr Rehn's idea, and I hope that everyone else is as well. He says that, as part of this package, the Commission should be tasked with screening budgets before they are approved by national parliaments. This is not a matter of subsidiarity or of a lack of subsidiarity; it is a matter of loyalty towards the Stability and Growth Pact and the euro. We cannot say, on the one hand, that we are members of this Stability and Growth Pact and of the euro area, and, on the other, that our budget has nothing to do with the euro, or that this is a strictly national competence.
Secondly, I believe that this package must also integrate a convincing 2020 strategy. That which is on the Council's table at the moment, Mr López Garrido, is not at all convincing. Are you going to reach a conclusion in June? What, though, are you going to conclude in June with regard to the 2020 strategy? Will it be the same thing that you concluded with regard to the Lisbon Strategy, which failed? Will it be the open method of coordination once again? Well, if you are serious, you must now provide the Commission with all the instruments it needs to actually manage this 2020 strategy, this economic strategy which has to extricate us from the crisis.
The third thing which definitely must be done is to create a European monetary fund to replace the stability mechanism which was created, because that mechanism, as you say yourself, Mr Rehn, is not going to be up to the job. Once again, it is an intergovernmental mechanism which was concocted within Ecofin and which requires unanimity. Every single loan which is granted has to be approved by all the Member States. This is a system which cannot function in the long term, and a European monetary fund, managed by the Commission and, if necessary, by the ECB, is therefore required. However, it must not be left to take those decisions which are the responsibility of all Member States in the euro area. Finally, we must have a European bond market.
This is what we are expecting from the Commission, Mr Rehn. We want you to be ambitious and courageous enough to put an ambitious package comprising these four points on the negotiating table within both the Council and Parliament.
(Applause)
Rebecca Harms
Mr President, ladies and gentlemen, my Group has once again decided to take a positive approach to the financial stabilisation mechanism which was agreed at the weekend of crisis talks in Brussels almost two weeks ago.
We are combining our support with a clear commitment to a more united economic and financial policy. This is nothing new for my group. It has been a tradition for us for many years. However, along with this commitment, Mr Rehn and Mr López Garrido, we want to see a serious decision being made not to continue simply combating the symptoms of the crisis, but instead to tackle the overall challenge that it represents.
As we see it, we have been trying to cure the symptoms since 2008. We have been attempting to save the banks since 2008, when Lehman Brothers went bankrupt. I would like to say once again that we must be honest with the citizens of Europe. The euro was not stabilised during the weekend before last. Instead, once again, a large number of German and French banks were rescued. The share prices demonstrated very clearly what had happened. However, we must get out of this cycle of rescuing the banks, which has cost us billions upon billions. We no longer know where the money is coming from and we are only daring to take tiny steps towards state regulation of the financial markets, going by the agreement in the Economic and Financial Affairs Council (Ecofin).
The central aspect of what we are calling for today is that the state must return to the financial markets and take a very determined approach. It must no longer be kept in check by the banks and speculators which everyone is complaining about. It is true that the banks are a vital part of the system, but there must be something very rotten in this system if our states can repeatedly be brought to the brink of disaster and the political system allows this to happen.
I would like to summarise the situation very briefly. We must now make clear decisions on certain issues. There are indications that some of the EU Member States are moving in the right direction, but we believe that there should be a ban on toxic assets and short selling throughout the EU, that hedge funds should be kept under very tight control, and that we must stop talking about introducing a tax on financial transactions and actually do something about it. We need this tax, among other things, in order to refinance what we are doing with public money. The participation of banks and speculators must no longer be merely a matter for soapbox speeches. We can genuinely guarantee their involvement by introducing the tax.
A second issue which is of great concern to me is the future of a coordinated budget policy in the European Union, in other words, budgetary discipline. I am very familiar with this term in a German context. However, I propose that, against the background of crisis management and the vote on the Europe 2020 strategy, we should once again come to an agreement on what we actually want, on how the Member States and how Europe should be presenting themselves to our citizens in five or ten years with regard to the responsibility of the state. Should the European strategy be used as a battering ram against the social responsibility of the state? I would very much like to know how you see all of this: nurseries, schools, universities, libraries, care for the elderly, hospitals, museums and theatres.
A week ago, my colleague, Mr Cohn-Bendit, said that Greece needed more time to put a reconstruction plan in place. I am familiar with the disastrous financial situation of many Member States and I believe that some of them need time to decide what should be done. As I have said, using a battering ram against the social security system would definitely be the worst thing that the European Union could do at this point. However, that does not prevent us from looking carefully at our budget policy in order to ensure that the different generations receive equal treatment. As Greens, we have supported budgets of this kind in Germany time and time again.
I would like to make one final point. If we were to give up on our climate policy and sustainable development now, as some people have indicated, we would really be implementing the devil's plan. We must not neglect innovation in industry and business, a climate friendly approach to production and the organisation of public transport. We must safeguard jobs by means of innovation, future viability and sustainability, but this does cost money. The introduction of new taxes is a taboo subject. However, I am convinced that we will only emerge from this crisis if we can break down the taboo of state intervention, the role of the state and the need for intelligent taxes.
(Applause)
Timothy Kirkhope
on behalf of the ECR Group. - Mr President, it has sadly become a characteristic of some of those who speak in support of the European Union to believe that the solution to every problem is more integration. This approach misses the point. What Europe too often lacks is not extra mechanisms to implement agreed policies, but rather the political will to fulfil commitments which have already been made but not executed.
I therefore earnestly hope that the Europe 2020 initiative, which is certainly necessary to deal with the underlying economic crisis faced by Europe, does not fail on the same basis. Concerning the eurozone crisis, however, we are told that, to avoid similar crises in the future, the Union needs powers to call for the prior presentation of draft budgets by sovereign governments and to impose tougher sanctions on Member States - but budget information was already supposed to be available; it was just inaccurate and poorly scrutinised.
Would the quality of information and the competence of those analysing the data improve just because a more demanding procedure was introduced? Sanctions were previously available; they simply lacked credibility. Increasing their scope does not make them any more likely to be imposed. Would the new measures be taken any more seriously? Furthermore, issuing debt, which risks increasing the EU budget and directly guaranteeing EU lending, is a major departure that undermines the principles of sound public finance which we are supposed here to be reinforcing.
In the ECR, we want the euro to be a success for the sake both of those who choose to join and of those in the wider European economy, but this requires Member States to take their responsibilities seriously, to be honest with each other, and to fulfil their agreed commitments.
By its own admission, the Commission believes its proposals will lead to a substantial deepening of economic and monetary union. It is little wonder that, whereas the English version of the text of the March summit referred to 'governance', which is what the Commission has also referred to, the French version referred to 'government'. It seems that, for some, a centralised European economic 'government' is indeed the ambition, but this would not address the problems we face: it would be bad for our citizens, for our Member States and, I say, for the European Union itself.
Lothar Bisky
Mr President, the most recent Council meetings indicate that far-reaching changes are under way. We are currently experiencing a process of governmentalisation of European policy. The Treaty of Lisbon praised the role of Parliament and the strengthening of that role. We have also spoken out in praise of this.
Fundamental agreements are now being reached between the governments and inconceivably large amounts of money are being spent. Until now, the parliaments have had little say in the matter and we must put a stop to this. The method used by those in government has resulted in huge sums being spent to rescue banks which are themselves responsible for getting heavily into debt. These governments have saved casino capitalism using taxpayers' money. However, they have taken a very hesitant approach to rescuing the states that are in debt. Somewhere, they managed to find EUR 750 billion. The question is whether the money printing press will save economic development. I believe that it is more likely to save the banks' capital. However, the European Union must be more than just a free internal market with a single currency.
Mr Barroso is right when he says that without an economic union, we can forget the monetary union. However, I cannot yet see any clear outlines. Persisting with the failed Stability and Growth Pact has relatively little to do with the sensible coordination of economic policy. What we are lacking is a social union. We are lacking the lasting and effective re-regulation of the financial sector. We are lacking a coordinated tax policy and wage policy and a tax on financial transactions. Although we have been talking about this tax for a long time, it remains just talk.
It is time to safeguard the social state by means of the EU institutions, not to dismantle it. The Greeks and other nations are afraid because they can see the measures that are being taken on the social side. It is time to fight for the harmonisation of social standards at a high level.
Hedge funds must be banned and tax havens abolished. We are making very slow progress in combating the crisis in the financial markets. In the light of the speed with which the speculators are acting, we are doing far too little. During emergencies like those that we are repeatedly being faced with, it is totally wrong to nationalise the billions which are being spent as losses and privatise the profits. The banks must not be allowed direct access to taxpayers' money with the support of the state. Incidentally, one thing is clear to me, and that is that in the current conditions, we will have to redefine the term 'bank robber'.
Niki Tzavela
Commissioner, I should like to take this opportunity to thank you personally for your hard and effective work in connection with the economic crisis in Greece. I should also like to thank all the parties in Parliament for the support and solidarity they have shown Greece.
I have three proposals and I should like, most emphatically, to ask for their support. As far as the adoption of a permanent instrument for economic governance is concerned, the Bruegel Institute, which is a think tank in the field of economics, proposes the following: the European Central Bank should guarantee European bonds up to 60% of the GDP of each country; these are so-called 'blue bonds'. Where bonds exceed the 60% limit, the surplus should be borrowed on market terms; these are so-called 'red bonds'. This is a proposal for a permanent instrument for economic governance; we do not need to set up new mechanisms and so forth and it can be adopted very quickly.
I have two ad hoc proposals for Greece: the International Monetary Fund could extend the repayment period for the loan to Greece from three to five years. If the same extension were adopted by our European lenders, it would be much easier and more realistic for Greece to repay its debt and this would be a good message for the markets. The second proposal is this: the amount in aid to Greece could be used to repay our bonds. It would be rational management of the issue if Europe were to release resources now, to be given to Greece in the future and used by it to develop the Greek economy. At the moment, the Greek Government is on the defensive; it is trying to scrape money together so that it can reduce its debt. However, we cannot try and stimulate growth at the same time. That is why, Commissioner, I think it would be a good idea if a parallel effort to stimulate growth were supported.
To close, I should like to say that we hope that the Greek crisis will be the only price the European Union has to pay for the hasty establishment of the economic governance which we should have established ten years ago. Let us hope that the Greek crisis is the only price we have to pay.
President
Mrs Tzavela, I did not interrupt you because you are from Greece, and this issue is very important, but because you spoke for more than one minute. Please keep to your time next time.
Nicole Sinclaire
Mr President, when you became President of this House last year, you said that you would treat all groups equally. I have noticed in this interesting debate that Mr Schulz ran two minutes over - all the groups ran over - but you picked on one group. Could you explain why this is?
President
I would like to say, Mrs Sinclaire, that I am watching the time. Those speeches did, indeed, run over by some seconds. The Member who was speaking a moment ago ran over by the longest, but I allowed this because she represents Greece, and it was also the opinion of someone who lives in Greece, and this matter seemed to me to be important. As a rule, I do not allow speakers to exceed the allotted time, but I think we are all agreed that Mrs Tzavela's statement was particularly important for us.
Francisco Sosa Wagner
(ES) Mr President, we had to be on the brink of the economic abyss in order for the Heads of State or Government to understand that the way forward is not more nationalism but more Europe.
Some measures that have been adopted are aimed in this direction, such as the reduction in vetoing rights in the European Council or the seeds of a European public treasury.
Finally, albeit late in the day, we have realised that we are all in the same boat and there is no point dealing with individual situations, especially in an improvised way.
I wonder, however, whether this attitude is a digression, or conversely whether it is the start of real European economic governance, because what we do not need, ladies and gentlemen, is governance. What we need is authentic government, if we want to be true to the will of the founding fathers.
Parliament must therefore promote all the reforms aimed at strengthening Europe and make budgetary and fiscal discipline a reality, while forgetting about nostalgic sovereignty.
Ladies and gentlemen, strengthening the European Commission and strengthening Parliament is the only right recipe for building Europe, as otherwise, it would disappear like a thief in the night.
Corien Wortmann-Kool
(NL) Mr President, what I have learned is that, if Mr Daul's farmhouse is on fire, you first have to put the fire out. Therefore, our group, the Group of the European People's Party (Christian Democrats), fully supports the rescue package on which the Council and the Commission have decided.
That a decision on a package to the tune of hundreds of billions of euro was unavoidable in a single weekend is a wake-up call to the fact that stricter and more consistent budgetary rules are crucial and must be strengthened.
Mr President, the Council was unanimous; let us also show that kind of unanimity. Unfortunately, however, listening to Mr Schulz, Chair of the Group of the Progressive Alliance of Socialists and Democrats in the European Parliament, I note that such unanimity is not to be found in this House. All of us in Parliament want a Europe with sustainable economic growth, sufficient jobs for our citizens and healthy businesses. We can achieve this only if we have a stable currency and a stable economy.
A Stability and Growth Pact that is enforced is crucial for an ambitious EU 2020 strategy. For both of the above, success is dependent on sound European governance. This is at the heart of the resolution we discussed with the groups in this House last week. Commissioner Rehn deserves our support, and I think it irresponsible that our fellow Members from the S&D Group are refusing that support.
Although irresponsible behaviour by speculators is not the cause, it has fanned the flames of the euro crisis. As far as our group is concerned, Commissioner Barnier must work energetically on proposals to curtail irresponsible behaviour on the financial markets.
Hannes Swoboda
(DE) Mr President, ladies and gentlemen, Mrs Wortmann-Kool is wrong in two respects. Firstly, we definitely do not want Mr Daul's farm to burn down. We do not want any farm to burn down. We want to take precautions, that is our objective.
Secondly, we very much support the measures that Mr Rehn has proposed. It is simply that in some cases, they do not go far enough, because the majority of the measures have only been suggested when Mr Daul's farm is already on fire. You rightly say that we must prevent the farm from catching fire in the first place and that is the decisive point which I would like to discuss. Mr López Garrido said today that it had taken an infuriatingly long time for the decisions to be reached. It is also the case that we have spent an infuriatingly long time taking note of the changes that have happened in the European Union over the last ten years.
Mr Rehn has correctly pointed out that differences between the individual euro countries with regard to competitiveness have increased and not decreased. What you do not mention, Mr Rehn, is something that is very important to us, namely, the fact that the gap between the rich and the poor in Europe is widening. If that sounds like Marxism to Mr Verhofstadt, to us it is a question of social security and social policy. However, that is simply not of interest to some people.
The question is how you intend to get people to accept the economic measures and the strict budgetary requirements which you rightly propose when people begin to realise that Europe and the euro area are characterised by a growing gap between rich and poor. This is unacceptable and this is why there are more protests against the necessary measures than would normally be the case.
Therefore, we are calling on the Commission and the Council to act. We must reduce the differences in competitiveness. I believe you are absolutely right when you say that we must succeed in increasing the competitiveness of countries such as Greece and Spain. This is not about making the competition conditions worse in Germany, Holland, Austria or other countries, but about improving the competition conditions in the economically weaker countries. That is absolutely the right strategy, but your proposal, Mr Rehn, does not include any specific measures for bringing this about.
You spoke today about the reform of the labour market and the pension system. This is the right approach, but it is not enough just to reform the labour market and pensions. We must also look at the budget. If we do not develop our infrastructure and if we do not use all the means at our disposal in the Europe 2020 strategy, including green technologies and so on, we will not succeed in achieving this objective. Therefore, I am asking you to take note of the fact that competitiveness and social security in Europe must be strengthened.
Adina-Ioana Vălean
Mr President, I would like to make a point on the situation in those Member States that are not members of the eurozone but which still share the same preoccupation. Political leaders in our countries have been selling the idea that EU membership should be seen as a guarantee against hard economic times, but reality has now proven differently. The euro is constantly attacked from all sides despite all the efforts made, and we all know that fresh money is only a quick fix for a much deeper problem. This is an exceptionally serious situation and we need exceptional answers.
Let us face it; there is no escape from deeper economic integration and this therefore implies closer political union. Because this imbalance leads to daunting divergences between Member States, and to ensure financial discipline at European level, we need good governance, sanctions and compliance mechanisms. We need to find ways to encourage investment, attract capital and boldly cut bureaucratic expenses. We need to see intelligent measures taken by governments. In Romania, for example, the government is cutting pensions and salaries instead of reducing bureaucratic expenses or money for political clients. We have in Romania more employees of secret services than the FBI has but, instead of cutting here, we are cutting doctors and teachers.
I strongly encourage the Commission to stand by the proposed measures and not to give up under Member States' pressure, because only a few can be seen as examples these days.
Philippe Lamberts
(FR) Mr President, ladies and gentlemen, yes, we need responsible public spending. Yes, we need to balance our budgets. This requires responsible management of expenditure, and enough has been said about that for the moment. Yes, of course, this requires increased mutual supervision between equals. But, no, Members of the Council - and this is, I might add, addressed above all to the gentlemen Members, and not so much to the female Members - it is a sham to let people believe that we are going to meet the current challenges solely by reducing expenditure, as that will most certainly plunge Europe into recession, that will most certainly destroy the social fabric, this social cohesion that is part of the EU's identity. Therefore, if we wish to bring public finances back into balance, which is the only option, and also be able to invest - because this is not simply a matter of reducing deficits, but of investing in our future - we will have to find new income streams. This means making the financial sector contribute, it means imposing a tax on financial transactions, but also on the banks, and it is not a matter of choosing one or the other. It means making those who have profited the most from the situation contribute - I am talking here about the energy sector; it means stopping the handing out of gifts, such as all the tax reforms that have been implemented, to society's richest individuals or to companies that take advantage of tax havens, and really trying to stamp out tax fraud. This therefore means breaking another taboo, ladies and gentlemen: not the tax taboo but the taboo of sovereignty, which you, Members of the Council - and, unfortunately, with the support of the Group of the European People's Party (Christian Democrats) - will defend to the death. Better to have tax sovereignty and failure than to really tackle the roots of the problem.
Finally, with regard to financial supervision, I should like to encourage ...
(The President cut off the speaker)
Derk Jan Eppink
Mr President, the President-in-Office just asked whether there was an exit strategy from this crisis, and I would say yes, there is: it is called fiscal conservatism. The structural problem of ours has been that public overspending went on for too long. The public sector was out of control for many years. Even in good times, the German Government of Mr Schröder went through the 3% ceiling, and Greece, of course, broke all the records, because the Greek political class is utterly unable to manage money.
We had the Stability Pact. What did Mr Prodi say about the Stability Pact in 2002? You know: you were the head of Mr Liikanen's cabinet. He said the Stability Pact was stupid. So we had to change it. This was the guardian of the treaties. We did change it, and we put it on the slippery slope - and we see the results today. The EU will be faced with a track of fiscal conservatism for many years to come, and that is going to be very important.
What we need is innovation, more free markets and more entrepreneurial skills, Mr Schulz. Mr President-in-Office (from Spain): do we need taxation? No, it makes things even worse. It pushes the EU into stagnation, and you will be Robin Hood in reverse.
I understand the anger of the people - the people with pensions, the people with savings. I understand the German taxpayers. They know that they will have to pay, but German taxpayers cannot always pay. I find it a bit pretentious of Mr Verhofstadt (if he is still there) to tell Mrs Merkel to shut up talking about the euro. This was said by a former government leader who messed up his own country. So what is he trying to prove?
Patrick Le Hyaric
(FR) Mr President, you will not be able to calm the financial markets without giving up a sacrosanct principle that you defend, which is the completely free movement of capital and so-called free competition, which really means unfair competition.
Today, a great deal of money is being put on the table, but this is actually designed to reassure the financial markets, whereas to the people you promise only pain. You have brought the IMF back into the European fold. Why were we not consulted about this decision? Now, in a show of strength, you wish to actually usurp power by seeking to have the national budgets overseen by the Commission itself.
You talk unceasingly of deficits and debts. Why, though, do we never talk about existing revenue options? We have a deficit at the moment because we have consistently lowered taxes on capital and created the conditions for an increasingly unequal distribution of wealth. Therefore, the measures to be taken should include amending the statutes and the role of the European Central Bank. We need true solidarity ...
(The President cut off the speaker)
Mario Borghezio
(IT) Mr President, ladies and gentlemen, how long will the euro last in its current form? Are we perhaps headed towards its destructuring within a year or two?
I do not agree with creating a new supplementary deficit of EUR 750 billion to cover an earlier one or that these measures are sufficient for building the socio-economic future of 500 million Europeans, nor do I agree with the dogma of saving the euro as it is, because it should be done by keeping the euro as low as possible and reducing the interest rate to inject capital into productive investments for our industries, which are gasping for air, rather than into public financing.
I do not agree with the European Commission expecting to review and audit the accounting of Member States' budgets before the national parliaments: farewell to sovereignty. I disagree with an economic and financial strategy that fails to contemplate specific needs.
Hans-Peter Martin
(DE) Mr President, I am opposed to the Council's unacceptable anti-European approach. You are complaining about the crisis and you are now introducing an economic protectorate, while you bear the central responsibility for many of the causes of the crisis. You have not allowed regulations to be imposed when they were needed. Just one example of this is Eurostat. The officials, who have been the subject of so much condemnation and whom I have repeatedly criticised in other areas, highlighted the problems in Greece and also in Spain and Portugal at an early stage. The Commission called for Eurostat to be given appropriate powers to conduct investigations. Who blocked this move? The Spanish, the British - Mr Martin is not here - the Germans, Mr Daul and his people from France and the Austrians, because you did not want your books to be looked at, because you knew how much they concealed. This applies also to Mr Grasser, the former finance minister, who is now appearing all over the place on German television, instead of facing criminal charges in Austria.
What we really need is, of course, not an emergency government. You will not do what the Americans sensibly did in a similar crisis, which is to pass a Glass-Steagall Act, to increase the banks' capital, put a check on the conduit banks and reduce the systemic risks. What we need instead is democratic legitimacy, a two-chamber system which will finally put an end to the nonsense of the Council, which is outwardly so pro-European, but internally makes decisions without democratic legitimacy, so that we can bring about true democracy in Europe.
Othmar Karas
(DE) Mr President, ladies and gentlemen, firstly, the crisis highlights very clearly the limitations of the treaties, our own weaknesses, the double standards in dealings with the European Union, the deficits, the errors and the lack of seriousness.
Secondly, it also indicates that anyone who does not do their homework is harming themselves and putting the EU at risk. This applies to the Member States, but also to the Commission and to us.
Thirdly, when the European Union establishes objectives and rules for itself and agrees on procedures and sanctions, the Commission must not be dependent on the agreement of the Member States in order to be able to meet its obligations. The deficit and sanction procedure needs to be automated.
Fourthly, I would like to call on the Council to end the Eurostat blockade. It must be possible for Eurostat to carry out investigations in the Member States when it wants to and its employees must be able to speak to the necessary people while being aware that this is the right thing to do. We need information, but without advance authorisation.
Fifthly, you have mentioned hedge funds and we have not yet come to a decision on this subject. I am calling on the Council to enter into negotiations with Parliament very quickly so that we can hold the first reading of the hedge fund regulation before the summer.
Sixthly, on the subject of the transaction tax, we must not just keep calling for it; we must put it into practice. The Commission should quickly submit a proposal for the European transaction tax.
My eighth point is directed at the Council. We are committing ourselves to holding an impact assessment of all national legislation which is relevant to the EU.
My ninth point is that we need to study the effects of all the measures on the real economy and we need more Europe and less intergovernmentalism.
(The President cut off the speaker)
Udo Bullmann
(DE) Mr President, Mr López Garrido, ladies and gentlemen, I have a very specific question which will allow us to emerge from the position of powerlessness and confusion that the crisis has left us in, with no one knowing how the crisis arose and how we can find our way out of it. Mr Schulz has referred to the highly critical speculative products and credit default insurance and to the damaging practice of short selling, which brought Greece to the brink of disaster and could represent a major problem for Portugal and many other countries. Mr López Garrido, you have frequently attended the Economic and Financial Affairs Council (Ecofin) in recent months, why was it not possible for the Member States to take concerted action to ban these products?
I have been asking this question in the capital of my own country over recent weeks and months and it has taken you months, in fact until yesterday evening, to introduce a ban on the damaging practice of short selling. I ask myself why we have to wait until things have gone wrong before making use of the appropriate legislative measures, which are already in place, to protect the people and the economies of Europe. I believe it has something to do with the Council's dreadful, discouraging slowness to act, which you have referred to. I will make a deal with you. We in the European Parliament are presenting concrete proposals. In the context of regulating the supervisory bodies and the discussion about hedge funds, we have proposed that we should take appropriate measures on a European level and we will make the same resolution on derivatives, if you, Mr Langen, do what you are always saying.
We are calling on you urgently to ensure that the Council finally begins to work with us to put in place legislation so that we in Europe are able to act and no longer have to wait for ever for the Council to make a move. We need to have the tools at our disposal in Europe to enable us to make progress. Please help to make sure that this happens in the Council. However, the decisive point is that the Council must take action on the legislation.
Marielle De Sarnez
(FR) Mr President, this is probably the most serious crisis that has ever confronted Europe, which is why urgent action is needed; we have to take decisions, and good decisions at that, and we cannot wait until October.
The rescue plan was the first decision taken and it was probably taken too late, but better late than never. Now, we must urgently follow it up with the establishment, in the long term, of a real European monetary fund, a European bond market and a European rating agency, because as we all know, the single currency will not be able to operate without budgetary, tax, economic and political convergence. Moreover, until Europe indicates that it wishes to be governed, the markets and speculators can quite simply take the reins. There is a lot of talk about economic governance, but perhaps we should concentrate on the issue of the actual governance of the European Union, which has been lacking recently.
In my opinion, we should set two targets. Yes, of course the debt has to be reduced, but we must reduce it in a realistic and credible way and, at the same time, we must obtain those margins for manoeuvre and implement the reforms needed to prepare for the future. We must do both things at the same time. That is why it is vital to create synergies between the national budgets of Member States - I would have preferred the Commission to have expressed it in these terms - which is why it is probably vital to reform our tax system and to direct it more towards development and growth and to harmonise it. There will no monetary union unless there is budgetary, economic and political convergence.
Pascal Canfin
(FR) Mr President, Mr Rehn, as you know, there are two ways to reduce deficits. Expenditure can be cut or taxes can be increased. All States can cut expenditure at the same time, although separately, without needing any European coordination. However, to increase taxes and, more specifically, taxes on capital, companies, profits and banks, they do need European coordination.
Your communication last week contained absolutely no mention at all of this issue. My question, which is a fairly common one among Members from all groups, is as follows: over the course of the next few weeks, are you going to propose a tax coordination plan to provide Member States with the means of recovering margins for manoeuvre so that they can increase certain taxes, which is something they are unable to do separately? This is the added value which the European Commission can provide at the present time. Unfortunately, you do not have any plans in this area. Mr Verhofstadt was saying that you had a right to take the initiative. In the current situation, you have a duty to take the initiative in this area.
Peter van Dalen
(NL) Mr President, it is to be feared that the support package for Greece will not work. After all, no country in the world has ever managed to reduce a 14% budget deficit to 3% in three years. Greece will be no different. There is a great deal of opposition in Greece to the austerity measures, and so it is highly likely that the country will be sucked into a negative growth spiral, with sharply declining consumer spending even though an increase in that spending is actually needed to pay off the loans plus interest.
Therefore, Athens will sound the alarm again at some point, saying, 'we are not managing to pay it off'. There is a good chance that Europe will then write off the loans, with the familiar words, 'we have no choice; we need to prevent worse happening'. Mr President, the lesson to be learned from this crisis is: be honest and keep your word. The countries of the euro area must put their budgets in order, publish honest figures, comply with the requirements of the Stability and Growth Pact and purge their debts. Countries failing to do those things must leave the euro area.
Nikolaos Chountis
(EL) Mr President, the biggest unemployment march in the last ten years is due to take place in Greece tomorrow. Greek workers are demonstrating against the measures taken by the government, workers who neither work less nor are paid more than their counterparts; you can see the data for yourselves.
Mr Rehn, it is major hypocrisy to call this tripartite financing mechanism a 'rescue and solidarity' mechanism. It is a European punishment mechanism, with the International Monetary Fund playing bad cop. For six months, we have been suggesting that you make use of Article 122 of the Treaty of Lisbon. For six months, we have been calling on the European Central Bank to change its policy. For six months, we have been calling on you to investigate the unacceptable American credit rating agencies. You did not do so. You let the speculators run riot, you brought the International Monetary Fund into the euro area and now you are asking for harsh austerity programmes. This mechanism must be debated by the European Parliament, in accordance with Article 218 of the Treaty of Lisbon; we need a real debate on solidarity policy.
Marta Andreasen
Mr President, we can all recall the pompous presentation made by the Spanish Prime Minister earlier this year. However, Spain is now following Greece with a deficit of 11% in GDP. The EU bureaucracy immediately looks around to find someone to blame, but the fact is that it is this bureaucracy that is responsible for the crisis because it brought countries into the eurozone in the knowledge that their economies were not up to speed - or do we employ 1 000 people in Eurostat just to be a data collector?
The hedge funds may be taking advantage of the situation, but they did not cause the crisis. The EU now demands cost reductions, but is it realistic to expect the cost of the public sector in Greece to be reduced if 20% of the working population is employed by the state and 50% of SMEs have the state as its only client? Now, a rescue package has been put forward but the reality is that most of the countries supposed to contribute to it do not have money to do so, such as is the case of the UK.
In any case, the EU always takes the opportunity ...
(The President cut off the speaker)
Andreas Mölzer
(DE) Mr President, too rapid centralisation and Europeanisation, possibly also in relation to the introduction of a European currency, are part of the cause of the current problems. The fact is that the European currency simply cannot be a hard currency in the long term, because it has brought together very different national economies, some of which are in a weak position, under the same umbrella of monetary policy.
Now the call is for a common, centrally managed economic policy to accompany the single currency, which amounts almost to European economic governance. It is undoubtedly true that weak national economies must be subjected to strict controls on their budgets and their debt management strategy if they want to remain in the euro area. However, the sort of centralisation which takes the form of Brussels exerting budgetary authority over all the Member States would, in my opinion, be a massive and improper intervention in the sovereignty of the Member States. This would really just mean going from bad to worse.
The crisis must not be used as an excuse to introduce more EU centralisation, which is something that many people have wanted since before the Treaty of Lisbon came into force. If we really want to learn lessons from the current crisis, we may have to find a quite different structure for European monetary policy. This may be something like a European hard currency union in a core Europe, in which the national economies that do not meet the convergence criteria would exclude themselves from the euro area.
We know that austerity programmes will soon be the order of the day throughout Europe. One thing is clear: if the Member States and the citizens of Europe have to introduce savings, then the European Union must do the same, perhaps by investigating the overlapping areas of authority and duplication of effort among its forest of agencies and sorting out its budgetary controls. We in Parliament will also have to consider whether, by increasing our staffing budget and raising the secretarial allowance, we are sending out the right signal at a time when savings are being introduced across the board.
Werner Langen
(DE) Mr President, on the day that we celebrated the 60th anniversary of the Schuman plan, on 9 May 2010, the Council formally laid the Monnet method to rest, with the help of the Commission. For example, a legal basis for the financial aid has been chosen which prevents Parliament from becoming involved, namely Article 122(2). The Commission has tolerated all of this. I would like to join in Mr Verhofstadt's criticism. It is not a crisis in the system or in the euro, but a crisis in government. When I see the Spanish President-in-Office of the Council here, I have to ask myself what the Spanish Presidency has actually achieved. It has not come up with any ideas or any incentives. While we are discussing the most difficult problem faced by Europe, you are organising splendid summits in Madrid - we will not begrudge you that - but it does require us to be here.
The Commission has accepted everything that has been thrown at it. It has allowed itself to be given the run around by the Council and following severe labour pains, it has given birth to a communication which does not contain a single concrete proposal. I can only agree with Mr Bullmann in this respect. Where are the concrete proposals? Will we once again be given a basis for discussion for the next two or three years? That is simply not enough. We want the Commission to have the courage to take the initiative on the Monnet method, on the Community method and on common institutions and proposals.
Everyone here knows that the cooperation of the Member States on economic and financial issues is long overdue. That is the cause of this crisis. It is caused by the level of debt in the Member States and the fact that they have lost control of it. The diversionary tactics aimed at areas of the financial market represent the wrong approach. Mr Schulz has not spoken as if he were suited to more than simply being the leader of his party, but he is right on one point and I would like to tell him so. We also regretted the fact that our Greek colleagues in this group did not support this package in the Greek Parliament. I think this is irresponsible. However, we should also point out that all the states in crisis in Europe, all of those which blocked the new moves, including Great Britain, Hungary, Portugal and Spain, have socialist governments.
Juan Fernando López Aguilar
(ES) Mr President, the current session of the European Parliament began a year ago, and there has not been a single plenary sitting in which we have not discussed the crisis. It is true that there is nothing more important for us to talk about than a crisis that has destroyed 20 million jobs in Europe. It is very important, however, that we define our object correctly, because an equation that is poorly expressed is impossible to solve.
The crisis is not the 'euro crisis in Greece'. It is a crisis that has demonstrated three intolerable asymmetries that must be overcome.
The first is the asymmetry between the real economy and the financial economy.
The second is the asymmetry between the monetary union and the lack of a fiscal, budgetary and economic-policy union that is in step with the monetary union.
The third is the virulence of the crisis and its challenges and, despite this, the exasperating slowness of the response and decision-making mechanisms that are typical of the European Union.
We are therefore behind in responding to all those millions of unemployed people who are looking to us, and we are raising difficulties that are not arising in other countries that are tackling the crisis with greater decision-making capacity.
We have seen extraordinary decisions at the same time: the communication from the Commission, the extraordinary decisions of the Council of Ministers last week and, of course, the 2020 strategy.
However, these extraordinary measures do not come free of charge: they are accompanied by major requirements, restrictions and threats of penalties for countries that are not capable of restricting spending, and which could therefore also compromise growth.
Yesterday, we were talking here in Parliament about the European Convention on Human Rights and the Action Plan for the Stockholm Programme. We had the opportunity to recall that Europe cannot be built solely with an internal market and monetary union. Europe is not principally built on those things, but on citizenship. It is therefore the time to recall once again that those millions of Europeans are expressing their discontent with the Europe that we are offering them, with the Europe that is expressing more threats and penalties for countries that do not comply than incentives for a model of growth that is capable of restoring employment and social cohesion and assisting in the fight against poverty.
Without that citizens' Europe, this crisis will be impossible to resolve.
Sylvie Goulard
(FR) Mr President, I would firstly like to thank the Commissioner and the Spanish Presidency for everything that has been achieved recently, albeit late. Sailing a ship through a storm is not easy.
You have broken down more barriers in a fortnight than in all the previous years put together, and I want to encourage you to continue along the same lines. I have a message for each of you. I should firstly like to say to the Spanish Presidency that in June, you are going to be responsible for the adoption of the Europe 2020 strategy. Do not put your name to this mockery. The Lisbon Strategy has not worked; some of the problems faced by southern Europe are due to a lack of competitiveness. As Mr Verhofstadt said, we need another way. We also need financial supervision. It has just been explained to us that Parliament is going too far. I am rapporteur for the European Systemic Risk Board. I note that during the course of the most turbulent weekend of the last few weeks, the word 'systemic' was uttered several times. Your presidency is responsible for this package. Be ambitious! You have our support. Do not listen to those in the Council who capitalise on the lack of regulation.
My second message is addressed to Mr Rehn, whose courage I salute; I fully support the Commission's proposal for national parliaments to work far more upstream with the EU. However, this must be approached very carefully or it will provide all the populists and all Europe's critics with a golden opportunity. You have our support, but let us try to have a more inclusive approach with the national parliaments, rather than giving the impression that 'Brussels' is dictating everything. I note that it is those same national parliaments that claim to be the protectors of democracy that have put Europe in its current situation by voting, year in year out, for deficit budgets.
Kay Swinburne
Mr President, we are in a situation of our own governments' making; it is not as though rules were not there to prevent these crises happening in the first place. If rules such as the Stability and Growth Pact and the Maastricht criteria had been adhered to, we would not have the level of debt crisis that we currently have in many Member States. I find myself in the very strange situation of drawing parallels between the behaviour and financial skills of our Member States' governments and those of our investment banks.
We sit on the Committee for Economic and Monetary Affairs every week discussing the inappropriate behaviour of our banks, saying they have not obeyed the rules or they have applied them flexibly with financially engineered accounting measures. This is exactly what our governments have also been doing. We demand responsible corporate governance and yet the level of off-balance-sheet finance vehicles, special-purpose vehicles and undeclared contingent liabilities that our governments are engaged in does not show how to conduct responsible governance.
In the UK, we have been shocked at the difference between the declared deficit of the outgoing government and what we have actually found once the books have been opened up. New leadership in the UK gives us a clear mandate to reassess the true state of finances. I really do hope that the rest of Europe can also do the same; restate their finances and find a way forwards.
Cornelis de Jong
(NL) Mr President, we need a coordinated European policy to address the consequences of the crisis; but Europe will have to stop being led by large companies, not forgetting the large financial institutions.
Governments have twice had to bail out our financial institutions, without these institutions footing even part of the bill themselves. In the past two years, the aid to these institutions from the Netherlands alone has led to a EUR 2.5 billion increase in interest expenditure. In the same period, the largest Dutch pension fund, ABP, spent EUR 1 billion on Greek government bonds in order to achieve a somewhat higher rate of interest. In other words, speculation is continuing as before, and soon we may have to rescue the pension funds too.
EU 2020 should lay the bill at the right door. Rather than by making extreme cutbacks to essential public services, the cost should be covered by the top earners and speculators, by means of partial debt relief for countries such as Greece and of a tax on banks, for example. This way, we preserve the European social model.
Nikolaos Salavrakos
(EL) Mr President, I should like to say that, in theory, I absolutely support the proposals made by Mr Olli Rehn, whom I am bold enough to consider the political head of Europe and the person who deserves our special respect.
However, what I want to say and point out is that a raging fever is as dangerous as hypothermia, both in the human body and in the economy. We must not jump from the slow adaptation of Maastricht, through which the entire economy of Europe passed for many years, to forced and sudden adaptation which will prolong the recession. The rich will get richer and the poor will get poorer. That is why I should like to point out that the continuing global economic disorder is due mainly to the creation of large unwanted reserves at global level and should be combated by efforts to stimulate growth at European level, so that we can address this crisis rationally.
Mario Mauro
(IT) Mr President, ladies and gentlemen, Mr Verhofstadt complained that nationalist and Marxist rhetoric are not enough to lead us out of the crisis. I will make an attempt with Europeanist rhetoric. Just a few weeks ago here in this House, many of us pledged our solidarity with Greece. Indeed, of what use is Europe if not to support Member States in need?
However, of what use are the euro and the Eurogroup if they do not promote a culture of responsibility and stability? What will happen if solidarity becomes synonymous with a European Union that, in violation of the treaties, is reduced to footing the bill for those countries which sacrifice their responsibility for their citizens' future for the fleeting consensus of a season?
Commissioner, is it Europeanist rhetoric if we ask the European Commission to be independent and authoritative and not to have regard for governments that cook the books? Is it Europeanist rhetoric if we request new regulations for the financial markets? Is it Europeanist rhetoric if we complain of errors in the construction of the euro, for which there are still no common fiscal and pension policies?
We are in the middle of a crisis, it is true, but this crisis was not produced by surplus or too much Europe, but by a shortage or not enough of it. Europe must strongly reprimand the States to be responsible, stable and serve the future generations. All this is not rhetoric if the initiatives we are talking about are simply created and implemented, and form part of a political strategy that is a step ahead of events so that we are not forced to run behind them.
David-Maria Sassoli
(IT) Mr President, ladies and gentlemen, a Europe of the people and not a Europe of the States. The crisis we are experiencing is the crisis of European policy's inability to govern the market. In order to save the euro, political institutions need to be strengthened and intergovernmental logic needs to be left behind to allow for European governance.
This is not rhetoric because a few minutes ago in Berlin, German Chancellor, Angela Merkel, sounded the alarm stating that the euro is in danger. Voicing alarm without indicating strong and convincing measures risks further weakening the single currency for investors and the market and making all of Europe weaker. Imagine the response of the markets in the coming hours, considering that just minutes ago, the euro collapsed again.
When we exit the House, Mr President, we may find ourselves poorer and more insecure. New European governance alone will allow us to defend the single currency, promote growth, employment and social inclusion. We must discard the old approach of coordinating national policies and equip ourselves with strong decision-making instruments.
New European governance must assure three levels of intervention: a policy for growth, suitable financial instruments and emergency management. The EUR 750 billion rescue package was important but we have realised that it is not enough. Today, we need a strong political initiative that can guide the market to allow for greater mobility of the resources. The monetary and budget policies have proven inadequate in assuring productivity and competitiveness. We must not be afraid to invest, above all, in Community interest projects such as infrastructure, energy, the environment, knowledge and human capital.
Mr President, Parliament has a great responsibility: to reinforce the capacity of Member States to leave intergovernmental policy behind and launch European spirit anew through its own independence.
Wolf Klinz
(DE) Mr President, ladies and gentlemen, the European governments are being driven by the markets. At last they are reacting, but they are reacting after the event and not in advance. It is scandalous that the governments and the Commission only react when the real weaknesses appear in the markets.
They should have identified these weaknesses themselves at an early stage. When the euro was introduced, we knew that we would not have a single monetary and fiscal policy, as is normally the case in individual states. For this reason, we have taken measures to find a substitute for this, but we have not adhered closely to these measures. The rules were broken very quickly and right at the start, even by the larger Member States. We need another effective set of rules with sanction mechanisms, including a name and shame policy, the loss of voting rights and suspension of payments from the European funds until the fines have been paid.
Secondly, it has become clear that there are internal tensions within the euro area which are on the verge of putting its strength to the test and which take the form of differences in competitiveness. The Commission must take action in this area. It must investigate the budgets of the individual Member States to determine whether they represent a risk for the euro area.
Of course, we know that the right to draw up a budget is a central right of the national parliaments. However, that is no reason for failing to develop a common European approach. This is urgently needed. We need more Europe and not less Europe. This may well be our last chance. If the Commission and the Council do not negotiate with Parliament, I am afraid that the result will be a major disaster at some point in the future.
Janusz Wojciechowski
(PL) I agree with Mr Mauro that in the fight against the crises, there has not been enough action from the European Union. In recent years, we have concentrated on political integration - we have been taken up with the Treaty of Lisbon and strengthening the competences of political institutions - but we have neglected cooperation on combating the crises. I am thinking of a variety of crises which require cooperation and solidarity. I am not thinking just of financial crises here.
As we hold this debate, several countries of the European Union, including my own country of Poland, have been hit by a huge flood. People have been killed, and there have been heavy material losses. People expect that in such situations, the European Union will come and help them, but there has not been much of this help. The European Union is weak because its budget is too small, and it does not have enough money for specific measures. Political strengthening is not being followed by the appropriate financial strengthening. I hope that as a result of this crisis, the tendency to reduce the budget will not increase still further, because then we will be even weaker and more helpless.
Jean-Pierre Audy
(FR) Mr President, the moment has now arrived in this crisis, which is not only European but also global, when we must have truth and clear-headedness and when responsibility must be taken.
Global governance is being established. What influence will Europeans have? How are we going to influence this global governance if we are incapable of establishing our own European governance? Nobody could have failed to see that, after 50 years of integration, increasing national selfishness was putting us at risk of 50 years of disintegration. Nobody could have failed to see that we were trying to create citizenship without the citizens, to conduct politics without the voters, to establish faith in the ideal of a rule of law without complying with it.
After the fall of the Berlin Wall, we reunified our continent with a belief in our strength but we were too proud to see our weaknesses. And what is happening now? The crisis is hitting us full in the face at a time when our European integration is fragile and comprises poorly governed and, in some cases, corrupt States. The chain of solidarity in the Union is currently being tested, and we all know that the strength of a chain is that of its weakest link. We are right to save the weakest, because the time has come, and it will be our strength that saves them. It is not EU regulations that are inadequate but their implementation by Member States and the European Commission, which has not adequately monitored the States, which has been defective.
It is not less Europe that we need, it is more Europe, but a Europe of truth, clear-headedness and responsibility. Of course, we have to respect the Stability and Growth Pact, which must be reformed. Yet the task facing us now is to regain the trust of our citizens, which means ensuring growth and jobs. Growth means investment. If the public sector does not invest, we cannot expect the private sector to do so.
In addition to a crucially important industrial policy, I propose, for the 10 years of the EU 2020 strategy, a major EUR 1 000 billion European investment plan aimed at making the EU territory the most competitive in the world in terms of trans-European networks, infrastructure, interconnections, high-speed trains, broadband services, motorways, water, space, research, health, energy, and education, and achieved through a reform of our budgetary support measures, in cooperation with all the public stakeholders and, in particular, the EIB.
Elisa Ferreira
(PT) Mr President, Commissioner, when the economic and monetary union turned 10 years old, the Commission thought that the euro was the Union's greatest success. It would now be difficult for us to make that statement without qualifying it, because the crisis has shown that the economic and monetary union is an unfinished project.
The minimum measures needed to save it were taken in a climate of emergency, but let us not delude ourselves: the pressurised conditions, the direct interests of the main Member States, and the painful and slow nature of the decisions have led to the precarious image that the public and the world have of the euro and the European Union.
We must face the facts. The European Union and the euro are a process of integration, not just inter-country cooperation: they are an unfinished process that must either be reinforced now or run a serious risk of disappearing. There are three issues that must be tackled. First, it is important to consolidate the instruments that have been created in this climate of emergency: a European monetary fund must be created; progress must be made with Eurobonds; progress must be made with the European supervisory and regulatory architecture, and progress must be made with a European dimension for managing the banking crises.
Second, it is important to understand that there is no strong currency if the economy is weak: the forecast of 1% growth for the European Union is unsustainable both in terms of its demographic makeup and in terms of fighting unemployment; and the 2020 strategy is nothing more than a collection of good ideas if there are no means for realising it.
Third, Mr Rehn, fiscal consolidation is important, but it cannot coexist with growing divergence between the Member States that make up the Union: convergence policy must be urgently reviewed.
Mirosław Piotrowski
(PL) For the third time now, the European Parliament is giving its attention to a centrally prepared 10-year plan entitled Europe 2020. The plan has engendered antipathy among many Members, not only because of the associations it evokes with historically outmoded political systems, but also because of the spectacular fiasco of its predecessor, the Lisbon Strategy.
Jaime Mayor Oreja
(ES) Mr President, I believe that the worst crisis that we could suffer is not only the one that we are currently suffering, but the one that we will suffer if we are not capable of learning the right political lessons regarding what is happening.
We have been living beyond our means, especially in some countries. We have moved away from the real economy and embraced the fictional economy, in our public accounts and, at the same time, in our family and private lives.
We have not been capable of understanding that, as is the case for any living organism, growing is not the same thing as getting fat. Growth requires effort and proportion, while the process of getting fat involves a lack of proportion and balance in comparison with the work that we do and the welfare that we enjoy.
This crisis does not remain static. The picture of the crisis a few months ago was a different one, a completely different one, to the picture that we have today. The picture of the crisis in a few months is going to be a different one to the picture that we have today.
This crisis was economic and financial, and will have a growing social dimension involving social conflict. This means that while we are in this phase, before the conflict becomes a social one, those of us involved in politics need to be aware that our main crisis is a crisis of confidence. It is not only a crisis of the euro.
Let us analyse all the political and electoral processes in recent months. There is a crisis of confidence, and that means that what we need to ask ourselves is how we need to change, how our attitude needs to change: our political, institutional and personal attitude. In this respect, instead of thinking about other institutions, the question that Parliament needs to ask itself is what contribution it can make to a change of institutional and political attitude in this House.
I dare say that today, having heard many reasons for the crisis - bureaucracy, agencies, governments - there are two issues on which we need to change. Firstly, Europe requires a minimum level of cohesion from Parliament: it cannot bleed itself dry in such a profound debate on two concepts of European society. Secondly, we need to dare to tell the truth about what is happening to us.
Anni Podimata
(EL) First of all, I should like to take ten seconds out of the proceedings to restore the truth. Mr Langen, who is not in the House, said that it was unacceptable that Greek members had voted against the three-year stabilisation programme in the Greek Parliament. I should like to point out that it would be a good idea for Mr Langen to repeat his recommendations at the next meeting of the Group of the European People's Party (Christian Democrats), because those members, who happened to be responsible for governing the country until a few months ago, belong to the PPE.
To return to the more general issue, it is a fact that the current crisis has highlighted chronic sicknesses and weaknesses in terms of the economic coordination of the euro area and in terms of the global system of economic governance and, as a result, huge, uncontrolled power has been amassed in the globalised financial system. So, today, we have, first and foremost, a question of democracy to address and Europe, if it wants to respect its values and history, needs to take a leading role here.
The decision to establish a euro area stability support mechanism is an important step, there can be no doubt about that. However, a crisis management mechanism is not enough; we need to tackle the causes at the root, not only at national, but also at European level. We are making a mistake and undermining our common future and the future of subsequent generations by putting the sole emphasis on immediate financial recovery and underestimating the impact of growth, employment and the basic structures of the welfare state which have been several decades in the making.
Commissioner, the proposals to strengthen economic cooperation which you presented on 12 May may help to construct a more cohesive Europe, with fewer macro-economic imbalances, subject to two preconditions: firstly, that they will not be limited to the inflexible application of the Stability and Growth Pact and, secondly, that they will fully incorporate specialised targets for viable growth and employment within the framework of the 2020 strategy.
Paulo Rangel
(PT) Mr President, several colleagues from the Group of the European People's Party (Christian Democrats) have already drawn a very complete picture of the situation. I think that what is needed now is mention of the role of the Member States.
The fact is that the national government of each Member State also has a role here as regards imposing the requirements and conditions for strengthening the single currency, and moving this project of monetary and economic integration forward. I would like to say here that our party - the party linked to the PPE Group, which is the Portuguese Social Democratic Party (PSD) - is supporting the government's austerity measures, because we believe that the mistakes that have been made during 15 years of socialist government in Portugal, which are now unfortunately visible for all to see, must be remedied; the PSD will support measures to remedy them.
Nevertheless, while we are supporting the austerity measures, we would also criticise the Portuguese Government - and this is a good example to others in similar situations - because it is not cutting spending. To reduce the deficit, it is essential not just to increase taxes, but also to cut spending and the government must have the courage to take measures to reduce spending, reduce the deficit and pay off some public debt.
This is true for Portugal and it is also true for other Member States that are in difficult situations. We, as MEPs, are also responsible for defending in our countries the measures that are necessary in order for the euro to come out stronger, and for this integrated area and this dream - the dream of the PPE Group and the dream we all share - to become a reality. That is why we are critical of governments that do not have the courage to take the necessary measures in their countries.
Göran Färm
(SV) Mr President, in some key points, this more communal economic policy also has an impact on the EU budget. We are talking about the funding of the strategic flagship project Europe 2020. We are talking about some costs, guarantees and so on for the loan mechanism and control of the financial markets. We are talking, not least, about a series of new duties that result from the Treaty of Lisbon. In the European Parliament, we are highly conscious of the fact that many Member States currently find themselves in an extremely tricky economic situation, often with difficult national budget problems.
On the other hand, it is clear that, in this situation, the EU can help by taking measures that are important for the economic recovery of the Member States and that will give a new boost to growth and job creation. The EU budget should therefore focus on areas where the EU can provide added value - European added value - and where the budgets of Member States and of the EU can complement and support one another. That also means, however, that the Member States cannot give the EU significant additional responsibilities without providing the necessary resources.
I am thinking of research policy, flagship projects and education and infrastructure investments that are required if we are to have a better economic future. I therefore think it is incredibly important that the spirit of this increasingly communal economic policy should also be reflected in a constructive attitude in the negotiations on the EU budget for 2011, in the mid-term review of the long-term budget and in the debate on the new financial framework after 2013. Otherwise, we will not be able to move forwards and put in place common measures to promote growth and jobs.
Theodoros Skylakakis
(EL) Mr President, as a Greek member of the European Parliament, I should like to repeat in the House something which I have said in public in Greece from the outset and to express my gratitude for the help which my country has received from the European support mechanism which, in conjunction with harsh but mostly unavoidable measures, has prevented the Greek economy from immediate collapse.
It would be useful if the mechanism for Greece had been adopted with the speed at which the support mechanism proceeded for other economies, when Europe finally realised the risk which we were all running. Today is the first time that I have seen real determination, both in Parliament and in the other European institutions, to look directly and realistically at the real economic impasses in Europe. Why are we in this situation? The main reason is that we have spent beyond our means and run up credit. We spent when there was no crisis, we spent during the crisis, we are spending now on our way out of the crisis. Anyone who wants to learn what happens when you consistently spend more than you have just needs to come to Greece.
The European Monetary Fund and the other institutions proposed in the resolution under negotiation are moving in the right direction. However, if it is to provide real incentives, the Fund needs to take account not only of the absolute size of the debt and deficit, but also of the speed of reduction of the debt and the deficit. Our real problem, and I say this to the left wing, is that 4 billion people in the developing world living on EUR 200 a month have discovered capitalism and are claiming global resources and markets from us, the rich, who live on EUR 2 000 a month. We in the West do not have a monopoly on the capitalism on which the old European model was built. If we do not change, if we do not hurry up with structural changes, competitiveness and innovation, we shall simply live more poorly.
Danuta Maria Hübner
Mr President, there is little doubt about the seriousness of the current crisis and the 'cost of use' of unprecedented policy methods is very high. The task of regulators and policy makers is to undertake actions that make it possible both to restore the equilibrium shattered by market failure and to correct failed government policies. This is being done, but it has still to be seen how fast, and through what policy measures, European Union Member States will return to their path of growth.
More regulation is not a guarantee against the risks of the current crisis. As we have chosen the path of more regulation, it should go hand in hand with increased simplicity and reduce the complexity of financial markets. What is also clear is that fiscal and monetary policies are not substitutes for structural reforms. Structural reforms have to address the underlying weaknesses of the European Union economy: sharply growing debts and deficits, ageing, the highly probable new surge of inflation, risks generated by climate-change policies, low productivity and lack of competitiveness.
With less public money, more will have to be done; hence, public money, both European and national, will have to be used more efficiently. A business friendly regulatory environment, efficient government, non-distortionary taxes, high labour participation rates, especially among women, a good education system, research and innovation - all that constitutes a minimum core package of measures to bring growth, jobs and competitiveness. Without doubt, the European winning strategy has to be based on fiscal tightening, but its focus should be on innovation, the only way to boost productivity and growth in a sustainable way.
The European Commission and the European Parliament should regain their strategic role and go for brave European solutions. Both citizens and markets need more Europe.
Gay Mitchell
Mr President, I take it as a given that sovereign states must be held to account for commitments made and be required to meet agreed objectives, so I start from there. But it is also time to look around and see what other actions are contributing to the recent turmoil. In the 1930s, the gold standard and protectionism contributed to a deepening of the recession. By contrast, within the European Union, we have had solidarity and the institutional capacity, via the European Central Bank and the Commission, to learn from past mistakes.
The work of the institutions has been impressive, given that there are 27 EU Member States, including 16 euro members. Furthermore, our institutions have cooperated with the US Federal Reserve, the Bank of England, the Japanese Central Bank and others. Despite this, the markets - the so-called markets - have, in effect, moved to take a negative view of almost every step taken. Now I am all for free markets; protectionism does not work. But are our markets free? The markets were well-massaged and influenced towards getting us into the crisis in the first place. Is there not by now a reasonable suspicion that powerful interests have a capacity to take on sovereign states and win, and that some - for whatever objectives - are using this power to advance their own agenda, using the markets for their own ends?
A political agenda could include concerns that the euro could, in future, replace the dollar as the pricing currency for oil, for example; a business and economic interest agenda could include simply amassing greater power and wealth by destroying sovereign rights, including shared sovereign rights, within the European Union. It is time for political leaders to reflect on just what is happening. I repeat: Member States must be disciplined, including the Member State I come from. Of course that must happen. But we are putting all the emphasis on Member States and very little on what is behind some market activity.
I would like to hear from the Presidency of the Council and from the Commissioner. What is being done to police this? When we did not police these people in the past, look where they led us. So do not have just one prong on your fork: it is time to have two prongs.
Alajos Mészáros
(HU) The Europe 2020 strategy is a very important strategy, especially now, at a time of growing financial and economic crisis. This crisis has spotlighted such fundamental questions and negative processes that if we do not integrate these into our strategy, this may jeopardise the success of our economic policy.
We must not allow the prestige of the euro to be damaged, but must do all we can for the sustainability of monetary union. I represent the last country to join the euro area. Slovakia's citizens consider the introduction of the euro a success story and therefore it is contributing as well to the protection of the euro with every means available.
We must raise awareness that the monetary crisis may have serious political consequences. These may include increased euroscepticism and uncertainty among those countries that are preparing to enter the euro area. We need to help and encourage those countries that have not yet introduced the single currency.
In devising the EU 2020 strategy, policies that guarantee sustainable development must be given a major role. Although work on energy diversification solutions in Central Europe is in progress, there must also be increased use of alternative energy sources in order to reduce climate change. We must also make people aware that the capacity of current alternative energy sources is finite. From the perspective of our long-term energy security, nuclear energy is the solution that can guarantee a sufficient amount of energy with the lowest levels of carbon dioxide emissions and, therefore, we must place great emphasis on the related question of the safe storage and production of fuel. Providing impetus for further research into modern energy technologies, such as the innovation involving fusion-based reactors, is also indispensable. Many important questions arise that we wish to incorporate into our strategy, and we are faced with the major task of improving the coordination and integration of various areas. It is only by doing this that we can ensure that, in addition to a monetary union, the all important economic union will also be achieved.
Marian-Jean Marinescu
(RO) I very warmly welcome the measures put forward by the Commission and Council. If these measures had been adopted some time ago, we could have avoided a large number of the effects of the crisis we are going through. A lack of economic governance led to decisions being taken under pressure and without any consultation with the European Parliament. In addition, there are no mechanisms in place for monitoring the measures adopted.
Last year, large sums of money were injected into banks. This was a necessary measure, but saving the banks has not helped mitigate the crisis later on. The crisis has continued. The Growth and Stability Pact has not been adhered to. Unacceptable deficits have been run up. States have taken different measures in similar situations. Some have decided to tell their citizens the truth and adopt austerity measures. The lack of common rules is having different effects on Europe's citizens, even though all Member States have helped trigger the crisis. We cannot consume more than we produce, nor can we spend more than we can collect.
We need financial stability. This is why the proposals for creating a new financial stability mechanism or European monetary fund are an absolute necessity. However, these measures need to be backed up by a coherent economic recovery strategy and by control and sanction mechanisms. This will allow us to say that we are going to establish real, effective economic governance for the benefit of all Member States.
Mairead McGuinness
Mr President, I will abide by your rule. I welcome the Spanish Presidency's comments about productive systems and a focus on competitiveness. I think we need a little bit more of that conversation in this Parliament, in Council and in the Commission.
In relation to your comments about the slow response, we need to look at that because there is the problem of a lethargy in the European system in terms of response. Member States could have reacted more swiftly when the banking crisis hit. We are capable of doing it but we seem not to have done it in this particular instance.
Finally, the Commission is looking for four pillars of a new strategy. I think the Commission needs to examine its own role in this crisis. I believe that the monitoring of the rules of the Growth and Stability Pact were on the basis of a 'soft' power approach which did not work. Had we all, as others have said, abided by the rules, we would not have this problem. Giving you more power will only work if you actually use the power you already have.
Elena Băsescu
(RO) During the current economic crisis, the Europe 2020 strategy seems to be posing a real challenge. On the other hand, it provides an opportunity as well. It can give an important fillip in terms of supporting the economic and social reforms required long term. Solidarity and adaptability must be the principles on which it is founded.
I believe that the allocations for the Cohesion Funds must be kept as they play a fundamental role in reducing the disparities in economic development between the EU's regions. On the other hand, it goes without saying that the objectives adopted at European Union level cannot automatically become national objectives. They must be adapted according to the possibilities of each country. The Romanian Government has set up a high-level working group which will set national objectives. At the same time, it will help coordinate the drafting of the National Reform Plan.
Antigoni Papadopoulou
(EL) The behaviour of the markets and of the banks is like a pack of wolves, as the Swedish Finance Minister called them, a pack of wolves ready to tear the economically weak countries apart. The first victim was Greece, followed by Spain and Portugal. In the case of Greece, we saw speculators hit it mercilessly, on the one hand, and Community solidarity which was very late coming and which came on very harsh terms, forcing the Greek people to make very unpleasant sacrifices and embark on justified strikes, on the other. It would appear that the protagonists of the international economic crisis are now the states, not the banks.
We need to learn from this adversity. The European Union needs more Community solidarity, better supervision of the financial system, stronger national compliance with the Stability Pact, more coordinated financial policy and measures to prevent competitive imbalances. The people of Europe want a more humane Europe, with fewer inequalities between the Member States. The time has come for a more realistic and people friendly programme for the European Union of 2020 which listens to the challenges of the times.
Olle Schmidt
(SV) Mr President, Europe needs more cooperation and more solidarity - not protectionism and nationalism. We know that - history has taught us.
I find it hard to understand the fear that the finance ministers evidently feel when faced with this proposal for prior examination of the Member States' budgets. In recent months, even hardened finance ministers were, and should have been, afraid. A vein of national self-assertion can certainly be detected here. By all means scrutinise other countries, but not mine. Scrutinise Greece, Spain and Portugal, but not my country. Noli me tangere - touch me not!
Our mutual dependence requires openness and trust. The Swedish and Finnish governments both have experience from the 1990s of serious crises, and they should both whole-heartedly support Commissioner Rehn's proposals.
Jaroslav Paška
(SK) A responsible budget policy in all countries of the European Union is only the first step towards solving the current situation. The next step, which is surely more difficult to implement, should be to strive for a measured change to our workforce structure. A large proportion of EU citizens, that is to say, are employed in non-productive sectors, especially public administration, and the productive sphere is not capable of supporting such a large number of bureaucrats, who only complicate life by dreaming up ever more regulations and restrictions.
Take a look at Asia, Commissioner. They do not have such a high percentage of educated people there or as many universities as we do. However, they do have a small public administration and an uncomplicated entrepreneurial environment, allowing them to develop the natural competitiveness which many people possess. An uncomplicated, transparent entrepreneurial environment, less administration and more room for the independent, entrepreneurial and creative activities of our citizens: that is the best way out of the current problems.
Andrew Henry William Brons
Mr President, the economic crisis is not a temporary illness from which EU Members will soon recover to full economic health. There are systemic flaws in the approach to economic policy of the EU and its Member States. The goal of a single currency, eventually for 27 plus countries, is based on the false assumption that one currency can be appropriate for many very different economies. The value of a currency must reflect the state of health of the economy it serves.
However, there are other distinct problems. The embrace of globalisation by the EU and its individual Member States is a recipe for disaster. We cannot allow goods and workers from low-wage countries to flood into Europe. We cannot compete with their goods without reducing our wage rates to their levels. Legal minimum wage levels will not prevent our workers being undercut covertly by migrant workers, the outsourcing of the work of our peoples or by moving our manufacturing to the Third World.
Tunne Kelam
Mr President, I would like to thank Commissioner Rehn for his kind words and confidence in the efforts of Estonia joining the eurozone, and I can assure you that, with the present financial burden at 7.5% of GDP, Estonia will not contribute to the increase of the average EU debt level. I trust also that eurozone colleagues will be able to accept Estonia as a positive example; that would send an encouraging signal also to Latvia and Lithuania convincing their people that it makes sense to make efforts and that all the applicants will be treated according to their merits.
Joining the eurozone at this moment is not just a privilege. It means taking solidarity commitments and making our contribution to the Consolidation Pact from the beginning, but I am convinced that this is a right decision; we shall see the EU not only as an opportunity to receive but, first and foremost, as a chance to contribute to advance our common cause.
Danuta Jazłowiecka
(PL) Today's debate on economic governance in the European Union is a fundamental discussion, because it concerns the matter of continuing to strengthen European integration. In view of their advanced economic links, Member States should all feel an equal responsibility for a European stabilisation mechanism and for the entire economic situation in Europe.
I do not think any of us should be in any doubt that accurate monitoring of public liabilities and expenses (the President interrupted the speaker), coordination of the process of creating budgets and plans for reform in Member States at an early stage and a mechanism for aid in times of crisis are measures which are heading in the right direction. Conscientious implementation of the principles of the Stability and Growth Pact should be a priority. This is a key to ensuring budgetary and macro-economic stability in the European Union. While a set of punishments and the principle of naming and shaming are essential for disciplining Member States in introducing the principles of the pact and essential reforms, I am reserved about financial penalties. For these penalties, used in the case of Member States which are already in a difficult financial situation, could have the opposite effect, an adverse effect on the economies of these countries ...
(The President interrupted the speaker)
Therefore, I would ask that we plan the future of Europe responsibly.
Liisa Jaakonsaari
(FI) Mr President, when there is a crisis the psychological reaction is either to curl up in a ball, blame others, look for enemies or try to find solutions. Europe is now witnessing this threeway approach: on the one hand, nationalism and protectionism are on the rise in many countries; on the other, new solutions are being sought, as is the case with the Commission. We have to appreciate them dearly. The stronger the political system is in the European Union and at national level, the better we can tame market forces. Otherwise, it will go badly.
I think there is one thing we could stop doing, and that is ridiculing Greece. The Greek nation, Prime Minister and politicians now deserve our respect, since they are taking some very difficult decisions. As Mr Schmidt said, Finland and Sweden were Greece in the early 1990s. We had to take decisions that were just as hard, but we succeeded.
President
I am sorry to interrupt you. You will notice in the Chamber that, although she was saying very nice things about Greece, I did interrupt her at exactly one minute, so I am trying to be as objective as I can be here.
Michael Theurer
(DE) Mr President, ladies and gentlemen, in the current debate on a functioning system of European economic governance, the long-term perspective is being neglected, in my opinion. Now is the right time to incorporate the short-term stabilisation measures into a long-term strategy. We need a vision of a market economy. The fundamental principle of the social market economy is already laid down in the Treaty of Lisbon. We must now bring it to life.
The social market economy was the successful model behind Germany's economic miracle. Walter Eugen, the guiding light of the economic miracle, remarked as early as 1950 that the economic activity of the state should focus on designing the regulatory systems for the economy and not on managing the economic processes. Therefore, I am calling for a regulatory approach, in other words, measures taken by the state to influence the basic conditions of economic activity by means of general legislation. It is not the state which creates jobs, but it must create a regulatory framework for job creation and this is what we need to focus on. Competitiveness is not the start but the result of economic activity.
Franz Obermayr
(DE) Mr President, in the Europe 2020 strategy, we must tackle the roots of the current crisis. Would it be sensible to introduce a monetary union along American lines without the necessary central controls on financial policy? The answer is 'no'. The euro must not be allowed to turn the EU into a huge redistribution mechanism based on mandatory solidarity. If we are to have a monetary union, it must be a hard monetary union.
In addition, the free financial markets must not be regarded as being separate from the real economy in future. Therefore, we need clear rules in the Europe 2020 strategy to deal with speculators and hedge funds. The route proposed by Austria and yesterday by Germany, towards a financial transaction tax, which involves the taxation of profits made by the banks and the financial sector, is definitely the right approach. Let us set an example to taxpayers and remind the financial sector of its obligations at last. We also need to be braver in applying the rules to the Member States. Any state which deliberately falsifies its figures must quite simply be ejected from the euro area. Countries which commit fraud must leave.
Paul Rübig
(DE) Mr President, Mr Rehn, ladies and gentlemen, the Europe 2020 strategy presents us with a specific challenge. Overall, we must focus on the small and medium-sized enterprises (SMEs). We should make sure that by 2020, small and medium-sized companies have an average minimum capital quota of 20%.
We need strong SMEs in Europe, because they employ two thirds of the workforce, produce 50% of the gross national product and pay 80% of the taxes. The Commission has simply forgotten to include objectives to strengthen small and medium-sized companies in this programme.
Mr Rehn, I am calling on you specifically to take action on behalf of SMEs and to draw up objectives to strengthen the position of these companies and their employees.
Milan Zver
(SL) Today's has been one of the better debates we have had on the financial and economic crisis, especially on how it has played out in Greece, and most of the contributions have essentially centred on the issue of how we should govern the European Union in the future. However, I would also agree with what those speakers who seek to apportion blame for this situation have pointed out. In my view, that is the right way forward and it is important that we take that route. We need to ask questions about the responsibility of some European institutions, and not just the collective responsibility of the institutions but who exactly is responsible for what.
Might I therefore suggest that we call to task Mr Almunia, the ex-Commissioner for Economic and Monetary Affairs, for example, as he was quite critical towards some countries during his term of office and then the Greek issue came up. I call on him to clarify his role in this story and, if he fails to do so, he should resign.
Seán Kelly
Mr President, firstly, the last few weeks have seen us put measures in place to deal with a financial crisis that has already occurred - a financial crisis caused by a lack of regulation, a lack of supervision and a lack of governance. Today's measures see us trying to anticipate these situations so that they will not occur in the future, and they are to be welcomed.
We all perform better when there is somebody looking over our shoulder. That applies to governments as well as to individuals. So I appreciate what has been done here today and I think that, from today on, we should also move on to dealing with the financial terrorists of the rating agencies and the speculators who are playing havoc with people's lives and trying to bring down sovereign governments. By taking that twin approach - dealing with governance at political level and dealing with the financial terrorists - we might be able to look forward to a better future.
Karin Kadenbach
(DE) Mr President, Mr Rehn, Mr López Garrido, we are talking today about common European economic governance. I believe it is time for us to realise that the market does not have an independent value and that the citizens of Europe do not have to serve the market, but instead, that the market is there to serve the people, the 500 million Europeans.
I am convinced that we need consolidation and growth, but both terms are always connected with another aspect, in other words, socially responsible consolidation on the one hand and sustainable growth on the other. We need confidence to achieve this and the people of Europe need perspectives. However, we will only be able to offer them these perspectives if we can promise them that they will live in a Europe where they can share in the prosperity or put measures in place to ensure that this is the case. In the Europe of the future, growth should not only benefit the few.
Rachida Dati
(FR) Mr President, first of all, it is true that the sudden emergence and the depth of the Greek crisis have created a great deal of fear amongst our fellow citizens, fear which I think is legitimate. Once again, this does not mean, as a Member has just said, that we should point the finger at Greece. However, it is important, it is urgent - as we have been saying for some time now - to learn the necessary lessons so that we can build a more political Europe and move towards economic governance. Economic governance should now be proposed as a matter of urgency.
I understand that the Commission is proposing to scrutinise the national budgets in advance. Personally, I do not think we should switch horses. What is fundamentally and urgently needed is European economic governance and not prior scrutiny of the national budgets by the Commission. I think that this proposal would not only reveal constitutional inconsistencies but also create delays and complexity, which is definitely not what Europe needs at the moment. What is urgently needed is European economic governance and not prior scrutiny of the national budgets.
Vasilica Viorica Dăncilă
(RO) We all know that the Europe 2020 strategy was launched with the aim of helping the European Union emerge from the current economic crisis and prepare its economy for the new decade. However, it is a serious matter that the Europe 2020 strategy does not even provide clear guidance on revising one of the most important common policies, namely, the reform of the common agricultural policy.
What makes this even more serious is that the reference to agriculture as a vital political instrument for achieving the EU 2020 strategy objectives was only made at the last minute. This is why we are not even surprised that there is too little mention of agricultural policies in this document. In this regard, the EU 2020 strategy includes some ideas about the future CAP. However, it fails to assign it a key strategic role as part of a wider, global approach, taking into account the huge challenges posed by the prospects of a twofold increase in the global demand for food and of climate change.
Czesław Adam Siekierski
(PL) Ladies and gentlemen, we do not have detailed analyses of the causes of the crisis in the euro area and the economic collapse in Greece, or of the dangers which are facing other countries. Is the global financial crisis, which turned into the economic crisis, the cause of this situation, or are we dealing, here, with our own mistakes, neglect and lack of action?
Let us say clearly and honestly that there was no coordination of financial policy in our Union. The Stability and Growth Pact was not adhered to, and financial discipline was not maintained. National budgets were often detached from reality: high costs, low incomes and lack of responsibility in governing the state. I would like to ask: where was the European Central Bank? Where was the Commission?
Let us say honestly that the problem lies in the fact that the Member States do not allow monitoring, evaluation and analysis of their budgets by EU institutions. In recent years, we have concentrated mainly on the Treaty of Lisbon, and we have devoted less attention to economic union, and especially monetary union.
Diego López Garrido
Mr President, we can really say that the European Union is facing a situation that is similar to others in its painful history that have been resolved favourably. Europe is at a crossroads, just as it was after the Second World War, which resulted in the birth of what was not then known as the European Union. It is what happened when the Berlin wall fell, when Europe was reunified, when there was, incidentally, a crisis in the European monetary system. The response was to move forward and adopt a new treaty. That is what we have done at the start of this century with the Treaty of Lisbon, and that is the only way out of a difficult situation such as the one that we are in.
The other alternatives, of course, are clearly populism or protectionism, and they are not an option. The clear choice is to move towards a Europe that resolves its shortcomings, which were demonstrated when this extremely serious crisis arose, the like of which those of us here in this House have never known.
Therefore, the way to respond to the situation of deregulated markets; a lack of competitiveness in the production system, which is having serious effects, with a social impact in terms of unemployment; the deficit problem, with 20 countries out of the 27 having begun excessive debt proceedings; and to an obvious lack of economic governance in the European Union, is not with less Europe but with more Europe. That is the way to respond to this situation right now.
It should be said that there has been a reaction, that the European Union has reacted, and I refer to the previous speeches made by Commissioner Rehn and by me, in which we set out how the European Union has reacted. At the moment, however, times are moving even faster, and I think that we need to be quicker in our response, which must help to resolve the fundamental problems that still exist in the European Union and have been put to the test as a result of this crisis.
I therefore want to propose that the European Union institutions and, of course, Parliament, cooperate on what I believe are the five aspects on which we need to move more quickly. We need to speed up, round off or complete the task that was planned and begun in the correct way.
The first aspect is solidarity. We need to deepen solidarity in the euro area, which is why the aid to Greece was so right and why the decision was so right to create this EUR 750 million fund - for a three-year period, so it is not yet completely permanent - to prevent possible difficult situations with public accounts or imbalances in public accounts. I think that this is a fundamental element, and that it was right for the Council to propose it and adopt it on 9 May. Alongside this there has been the action of the European Central Bank, which is intervening even now, buying debt from the Member States through the channels permitted by the Treaty of Lisbon.
Secondly, just today, Parliament has been examining a financial supervision package. We have, to some extent, had a foretaste of this with the adoption of the regulation of hedge funds in the Economic and Financial Affairs (Ecofin) Council yesterday. Therefore we can do it, of course we can do it. This regulation has been produced, but we need to conclude the negotiations between the Council and Parliament on the whole financial supervision package as soon as possible. This package also, incidentally, regulates the rating agencies, because - in relation to one of the suggestions or questions put forward by Members - the rating agencies are going to be subject to supervision by the European authority.
Thirdly, we need to commit to competitiveness. It is therefore very important for the 2020 strategy to be adopted and launched in the European Council in June, and that it quantifies the targets, including on poverty and social inclusion, which have not yet been quantified. It should be a strategy that establishes its own governance, and that governance should be much more demanding than the practically inexistent governance of the Treaty of Lisbon, as Mr Verhofstadt was saying earlier. It should also use positive incentives to ensure that the targets are reached, such as using European funds or the Structural Funds.
The fourth important element is the package on the coordination of economic policies presented by Commissioner Rehn on 12 May, which was examined yesterday in the Ecofin Council. It is absolutely essential that we comply with the Treaty of Lisbon when it states in Article 5 of the Treaty on the Functioning of the European Union (TFEU) that the Member States are obliged - not that it is better or desirable, they are obliged - to coordinate their economic policies and employment policies, and may also coordinate their social policies. Along these lines, we think that the implementation of Article 136 of the TFEU, established by this Commission proposal, is very important, and we also need to speed up putting it into practice.
Finally, I also believe that we must speed up the debate or the decision, which I think must be raised at the G20, on a tax on international financial transactions.
I would ask Parliament to support these very significant and very important points, which would be a step forwards towards what is being described as the economic governance or government of the Union, so that a decision can be made on it as soon as possible. We cannot wait much longer for this.
I believe that unity in the EU has never been as essential as it is now, and I am not just talking about unity between the EU Member States, but also between the institutions. Parliament is a European institution, the Commission is a European institution and the Council is also a European institution. The institutions need to work together at this time so that the move towards government of the Union and resolving the fundamental problems that have emerged can be consolidated. Let this be an expression of our commitment to beginning a new political phase in the EU that is beneficial to citizens, who are expecting us to do so. Do not expect anything else; expect us to do precisely that.
Olli Rehn
Member of the Commission. - Mr President, thank you to the Members for a very serious and substantive debate reflecting the serious situation we are now facing in Europe. Let me first say that I highly appreciate the broad support given by the European Parliament for reinforcing economic governance. I also listened very carefully to Minister López Garrido and I thank the Spanish Presidency for their support and for the excellent cooperation on this issue as well as on other issues.
I strongly agree with those of you who have called for an economic union to complement the monetary one. This is the way forward, and this is the critical lesson we must learn from the crisis. We have to work on three strengths. First of all, we need vigilance for the immediate resolution of the crisis in Greece and elsewhere in Europe. We have avoided another Lehman Brothers happening on European soil, but we are certainly not out of the woods yet, and therefore we must continue with vigilance and determination to safeguard financial stability in Europe and thus protect the still-fragile economic recovery of our continent.
Secondly, we need to speed up, intensify and complete the regulatory reform of financial markets, bank levies, short selling and credit agencies. It is much better to act at a European level and to do it as soon as possible.
We need to create a framework to correct the systemic errors of the financial markets and on this, I very much agree with Mrs Jaakonsaari and Mr Swoboda. The market can be a good servant but it is a bad master and, as Mr Theurer said, we need to work for the basic idea of a social market economy in order to create a credible legal framework for financial markets through completing the regulatory reform.
Thirdly, we need to move on to decisions concerning reinforcing economic governance in Europe; we need to strengthen the Stability and Growth Pact through preventive fiscal surveillance; we must put in place workable sanctions and they must be rules-based, as Mr Kallas said, and we need to get audit powers for Eurostat ...
(The President cut off the speaker)
President
Colleagues, this is the round-up of a very important debate. I kindly ask you to try to keep your conversations to a minimum in this Chamber and respect the Commissioner's final remarks. The Commissioner has the floor.
Olli Rehn
Member of the Commission. - Mr President, I am quite used to this but I would appreciate it if there were some interest in the House in what I am going to say.
Immediate crisis resolution, complete financial market reform and reinforcing economic governance: these are the three main tasks that we have to work on as soon as possible now.
I agree with Mr Marinescu, who referred to the Commission's communication, and it is indeed more than anyone would have thought even half a year ago. Please read those 10 pages of the communication on reinforcing economic governance in Europe. Ten pages sounds short, but it is full of concrete initiatives. This is heavy stuff, which is what we need in Europe. I will come up with concrete proposals, legislative proposals, shortly.
We have taken the initiative and we shall move on. Mr Verhofstadt said that we should not wait for the task force. Well, we contribute actively and constructively to the work of the task force presided over by President Herman Van Rompuy but, yes, we shall use our right of initiative and we shall soon put forward concrete legislative proposals on reinforcing economic governance.
That is the essence of the Community method and that is what you have also been calling for today, and rightly so. We do not have the luxury of time. Instead, we must act without delay. It is now absolutely essential to move on with these initiatives.
I therefore want to conclude by saying that we need an alliance of institutions to pursue these objectives. The European Union has always produced the best results by an alliance of the Parliament and the Commission, so I count on your support in this regard. It is also important that we bring the national parliaments on board by taking an inclusive approach, as Mrs Goulard has suggested.
But, most importantly, please recall that the European Parliament can help all of us in the European Union to act more quickly and with determination. So please convince your constituencies and help us convince the Member States, and not only the Spanish Presidency, which is very convinced. I trust you can, and will, make your voices heard, and I count on you taking a very strong and determined position in the Europe 2020 resolution in the course of this session week of the Parliament.
Dear friends, we need nothing more than full steam ahead to reinforce economic governance in Europe.
President
The debate is closed.
Written statements (Rule 149)
George Sabin Cutaş  
If there is any lesson worth learning from the current economic crisis, it must be solidarity. The fact that we are living in a globalised world where states' economies are interdependent is nothing new. However, countries have failed to abandon their isolationist logic where solutions to economic challenges are applied at national level, without any consideration of their impact on a wider scale.
The Lisbon Strategy failed due to a lack of political commitment on the part of Member States to take the lead in meeting its objectives. In order to ensure that the EU 2020 strategy succeeds where the Lisbon Strategy failed, national reform programmes need to be monitored more effectively at European level. Social inclusion must also be the main aim of good economic governance and state providers must learn to put people first before financial profit.
João Ferreira  
Little more than a decade after the creation of the euro, the warnings that we made at the time are being borne out. The integration of economies at very different stages of development, with nominal convergence criteria, and individual monetary and exchange rate policies - all done to meet the needs of the great powers - has made the divergence crisis in the EU worse, leading to a situation whereby the peripheral economies are being called into question.
Faced with the crisis that they created, speculative financial capital's decision-making centres - as well as their institutional extensions in the EU's institutions and in governments - have just launched a new and different attack on the people and workers of Europe. The lords of the EU have decided to usurp the budgetary powers of the Member States and they have done this not in the name of solidarity, which is a concept that is increasingly alien to them, but in the name of the stability that the great powers demand for the euro; this is an intolerable affront to democracy and the sovereignty of the peoples. This affront is accompanied by measures that are pure social terrorism, to which the national governments have meekly submitted. The response to the so-called 'European economic government' and to the increasingly antidemocratic nature of the integration process under way is being given by struggling workers all over Europe. The necessary change will grow out of this struggle and its drive towards progress.
Ilda Figueiredo  
It is regrettable that the European Council and Commission have come here to state that they are taking measures to resolve financial and productive problems in a framework of budgetary discipline, and that they are presenting the creation of the task force as the ace in the hole for long-term measures.
Despite acknowledging the delays to the hesitant measures that they have taken, what the representatives of the Spanish Presidency of the EU and the Commission have reaffirmed here was that they are going to continue down the same path of capitalist integration and go further with it; they are running around like headless chickens. They prefer to ignore that the so-called 'temporary stabilisation measure' and related fund will be nothing more than means of easing the pain of the financial crisis, used to conceal the fact that only a break with current policies and a change of course can bring social progress. To this end, it is vital to prioritise production, quality public services, the creation of jobs with rights, salaries, living pensions, social inclusion, and the fair division and distribution of income.
However, all this requires true economic and social cohesion, with a clear strengthening of the Union budget, solidarity, more public policies and monitoring of the essential sectors of the economy by the state.
Edit Herczog  
The way out of the economic crisis is a bumpy one and, in addition, the fiscal problems in Greece and other Member States have rocked the euro area. These problems have raised the question as to whether Europe is capable of competing with the economic strength of the United States or China. With its EU 2020 strategy, the European Union must, therefore, give an effective response to the economic and financial crisis and ensure that the economic capacity of this bloc of 500 million people remains competitive, in other words, that the EU27 do not fall behind their economic and political rivals. The complexity of today's challenges requires an integrated set of political instruments. The EU must give primary importance to research and innovation in tackling challenges such as climate change and finding solutions to increasing global competition. Since, in the period after the crisis, providing stimulus to growth and to job creation through research and innovation has become more important than ever, I suggest that this be set as the prime objective of the EU 2020 strategy. We are justified in our concern, however, that the current budget does not adequately cover the monetary needs to meet the challenges of the 21st century. As a member of the Committee on Budgets, I ask the European Commission to propose a new budget model that is bold and ambitious but also practicable, in order to guarantee the success of the EU 2020 strategy.
Anneli Jäätteenmäki  
It is excellent that the Europe 2020 strategy should take account of young people. It does not, however, go far enough. The content is limited and pessimistic. There are not enough concrete objectives and more of them are needed. The figures for youth unemployment are alarming. It is more than double than what it is in other unemployment categories. Almost half of young people are unemployed in Latvia and Spain. The longer people remain unemployed, the greater the risk, not just of poverty, but of exclusion. Young people with just a little work experience are in a worse off position in the labour market, especially when it comes to staff cuts. Predictions suggest that there will be a shortage of workers. We cannot take it for granted, however, that the young people who are unemployed now will be able to meet this future need for workers. It is not necessarily such a straightforward procedure to integrate long-term unemployed young people back into society. We need concrete measures. The young need jobs, not promises. It is very important that we take responsibility for the future, and that children and young people remain at the core of all our plans.
Lívia Járóka  
Launching the EU 2020 strategy intended to harmonise the Member States' economic and employment policies in accordance with common principles is perhaps the most important task facing us. I welcome the fact that, in addition to the aspects concerning a sustainable social market economy, environmental protection and innovation, the strategy also places great emphasis on the fight against poverty and exclusion, in other words, on strengthening social cohesion, a prerequisite for the abovementioned aims and one of the basic pillars of the Spanish-Belgian-Hungarian Trio Presidency's programme. I consider it an important step forward that the European Commission has, in the second half of its integrated guidelines on the strategy, set out ambitious, quantitative targets in this regard. Two of these targets are that 75% of the working-age population should be employed and that the number of people living below the national poverty line should be reduced by 25%. For the purposes of monitoring and verifying progress in meeting these targets and an assessment of the struggle against social exclusion, it is worth considering the 'Laeken indicators' adopted by the 2001 European Council at Laeken, along with their components that have, in the meantime, been expanded and defined in greater detail. The Laeken indicators provide a detailed, reliable image of the position occupied by various social groups in certain segments of public life. They have been used successfully in the past few years by numerous EU institutions, including Eurostat.
Danuta Jazłowiecka  
The main objective of the Europe 2020 strategy we are discussing should be to ensure economic growth in the European Union and to increase employment. The measures we take should aim to increase economic activity and, in this way, to achieve sustained economic growth in the long term. The indicators proposed by the Commission should be supplemented with an indicator of infrastructure saturation in the areas of teleinformatics, transport, energy, environment and social matters. A well-developed infrastructure is the basis for the efficient functioning of the internal market which, consequently, leads to a growth in internal demand and economic activity. In addition, a well-developed infrastructure is necessary to reduce differences in development between regions, leading to higher competitiveness and stronger economic, social and territorial cohesion. Furthermore, I would like to refer to the employment indicator, which should be treated as a priority. The steps we take should concentrate not only on structural reforms, but also on better preparation and use of the EU's workforce and intellectual capital. I suppose none of us is in any doubt that, along with implementation of the EU 2020 strategy, we will need stronger leadership and greater political responsibility from Member States, and also the European Commission, in the area of undertaking structural reforms. In this context, it would be helpful to make a thorough evaluation of the EU 2020 strategy around five years after its introduction, in other words, at the end of the mandate of the current European Commission. This would allow political responsibility to be strengthened and actions to be correlated with results.
Sandra Kalniete  
in writing. - The implementation of the EU 2020 strategy should emphasise economic cohesion, meaning that it is still crucial to reduce economic disparities between EU regions which lag behind and those which are more prosperous. I believe that the EU's attention should be still largely paid to the principle of solidarity and instruments for levelling out the income disparities. The focus should be kept on the EU regions which have suffered the most from the economic and financial crisis, and the specific situation of each of these regions should be assessed and appropriate reaction to the corresponding challenges should be taken.
In the Europe 2020 strategy, the agricultural sector is regarded like any other sector in our modern economy, and I welcome that. I am a strong supporter of a Common Agricultural Policy which secures a level playing field for all Member States. Fair competition in the internal market is a key to the competitiveness of European agriculture in the global marketplace. There has to be a synergy between the 2020 strategy and reform of the CAP post-2013 - both have to focus on promoting intelligent green growth.
Filip Kaczmarek  
The Polish Minister for Culture and National Heritage, Bogdan Zdrojewski, has pointed out that one aspect which should be included in the Europe 2020 strategy is culture. I must admit that the Minister's argument is convincing. For what he wants to do is to 'stress the need to make full use of the potential of culture and the creative industries - Europe's intellectual and social capital'.
The creative industries can be treated as something which will allow Europe to build a competitive advantage. The Europe 2020 strategy was discussed at an informal meeting of Ministers for Culture in March this year. As a result of that discussion, the Spanish Presidency called on 'the Council to recognise and use the creative potential of Europe through culture and its related industries in the 2020 strategy' and on 'Member States and the Commission to work in their respective fields to achieve the objectives ... through representative initiatives related to innovation, competitiveness, the digital agenda and social inclusion.'
I hope these appeals will be heard and put into practice.
Iosif Matula  
The large-scale economic crisis of the last few years has contributed to the failure of the objectives set by the EU at the start of this century. This is the reason why it is important for us to identify the shortcomings of the Lisbon Agenda and focus on the positive results that have been achieved, as well as avoid the mistakes made in the past. I believe that it is important for us now to be able to learn the lesson from the Lisbon Strategy's failure and also to have the ability to take action to mitigate the impact of this in future. I think that we have the great advantage of knowing the reasons for failure and of successfully avoiding them as part of the new EU 2020 strategy. I would particularly like to focus at this point on strengthening multi-level governance. We must involve local and regional authorities, as well as civil society, in the governance process since, according to EU statistics, local and regional authorities enjoy the highest level of trust among ordinary citizens. At the same time, reinforcing the regional aspect is included on the list of the EU 2020 strategy's priorities. In this respect, I feel that the role of the future Cohesion policy is to identify and utilise specific local potential.
Rareş-Lucian Niculescu  
The report spells out exactly the important contribution made by the Structural and Cohesion Funds to Europe's economic life and in achieving the objectives which have been presented to us as part of the EU 2020 Agenda. Some ideas are worth highlighting: the key role played by cities in achieving these objectives and the role of research and education.
At the same time, I would like to express my dismay that the report is not more comprehensive, by including the role played by the rural development funds. By revitalising rural economic life, modernising agriculture in Europe, helping to set up young farmers and spreading best practice, the rural development funds themselves make an important and welcome contribution to general economic advancement across the European Union.
Kristiina Ojuland  
Mr President, when outlining the Europe 2020 strategy, the Commission certainly managed to express many of the things we would wish for, yet they seem to have forgotten the present reality. Several Member States, including Estonia, have made large cutbacks in the interests of balancing the national budget. While fulfilling the Maastricht criteria for the euro area, Estonia has been able to stabilise its own budget. At the same time, the consequences of the irresponsible budgetary policy which has operated hitherto in several Member States will obviously remain to haunt the European Union for some years to come. Taking into account the current complicated economic situation, it remains unclear how the Commission's strategy and the large projects incorporated in it intend to deal with this. We could learn from our mistakes so that, unlike with the failed Lisbon Strategy, we would have a clear understanding of how we will achieve the objectives set, what kinds of financial resources we will be able to use, and whether our resources will enable us to achieve any of the objectives. We do not need grand words at the European Union level; every Member State, too, must strive to balance its budget and achieve economic growth. While noting the structural changes taking place in the world economy, mainly the tightening of competition, and also the demographic changes in Europe, we must, instead of lofty but empty-worded ideas, focus on radically reforming the entire economic and social system of the European Union. There is no other way to escape today from a welfare society which, although still comfortable, is quickly becoming uncompetitive and is therefore deteriorating. We necessarily face some unpopular decisions, but by making these decisions today, we will adapt much more quickly to the new reality.
Sirpa Pietikäinen  
The economic crisis we are seeing is made up of a continuum of three crises that are linked to one another. These are the financial crisis, the crisis in the real economy that followed it, and the crisis in the public economies that now comes from them.
These crises reveal the problems of European and global control and supervision: the economic crisis is largely a matter of a crisis in the system that once prevailed and in policy. Both the world of finance and economic activity no longer know their limits. It is not possible to manage activity that goes beyond its limits merely by resorting to national tools: we need regional and global rules.
As Mr Monti's report, which appeared last week, states, a single ad hoc solution to each crisis is no longer enough for Europe. We need predictive and longterm solutions and tools to help us manage future crises better than we do now. Crucial here are the willingness and ability of the Member States to cooperate, and that still leaves a lot to be desired. The Council deserves praise for its decisive action in its solution to the crisis that has threatened the whole of the Union, but not for its very prompt action: real action on the part of the Member States only followed because it had to. The dawdling probably caused the situation to escalate.
One of the most obvious forms of action in the future is the need to reform the EU's budget and ensure that national budgets are more closely in line with common objectives. Financial controls and regulation are already being made more effective, but we still need more measures to ensure that all financial products are brought within the scope of effective and viable regulation.
Rovana Plumb  
Achieving a minimum 25% reduction in the EU poverty level by 2020 is a target closely linked to the growth of employment among the population, which is a priority of the social inclusion policy. This is the reason why an ambitious long-term strategy is required to combat poverty, with large-scale poverty reduction targets, whose 'key points' must include an increase in the employment rate and in good quality jobs, including for women, young people, the elderly and poor workers.
This strategy must include measures aimed at achieving a work-life balance and greater involvement in an open labour market, which also means lifting access restrictions for Romanian and Bulgarian workers. Another objective for reducing poverty is to establish a minimum income of at least 60% of national median equalised income, a minimum salary of at least 60% of the average salary in the relevant sectors at national level, along with a coordinated housing strategy in Europe. All these measures must be accompanied by a clear timetable which is easy to implement and monitor.
Joanna Katarzyna Skrzydlewska  
One of the targets of the Europe 2020 strategy is to raise the employment rate among people aged 20-64 to 75%. Another is to fight poverty, which is intended to improve the situation of 20 million people. These effects are much to be desired and very ambitious. Our objective is a modernised labour market with a highly specialised, precisely oriented and very efficient workforce. However, I think this will be difficult to achieve. At present, 15% of young people do not complete a full secondary education. Over 30% complete tertiary education but, in spite of this, do not find work because the qualifications they have gained do not meet the needs of the market. The lifelong learning programme does not take account of the particular situation of people who do not possess a university education. If, however, we are talking about the phenomenon of poverty, the same social groups are most at risk from it: the unemployed, the poorly educated and the elderly. Such high unemployment is undoubtedly an effect of the crisis, which has caused, among other things, a drop in industrial production to the level of 20 years ago. I support the Commission in its consistent efforts towards making the EU economy competitive in relation to the United States and Japan, but I suggest a more realistic approach in the exceptionally difficult financial situation.
Csaba Sógor  
The economic and financial crisis has made it necessary in many Member States to introduce cost-saving measures and to reform existing structures. It has, once again, proven to be the case that a crisis can speed up the introduction of major changes and reforms. The European Union must also consider in which direction it needs to move in order to meet the new challenges and enhance competitiveness, and whether it will be able to harmonise the interests of Member States more successfully and thereby strengthen internal cohesion. I think that increased scrutiny of the particular situation in the new Member States during the process of implementing reforms is of crucial importance, not only for the success of the Europe 2020 strategy, but for the future of the Union itself. I ask the Council to pay closer attention to this matter, especially with regard to structural changes in the areas of the common agricultural policy and the Cohesion policy.
Nuno Teixeira  
Various aspects of the Lisbon Strategy in which there was little success can be identified. Few of the established objectives were achieved, owing to various factors: amongst others, the lack of political will and of instruments - not least financial ones. Local and regional authorities have also been pointing out that they were not involved enough, in either defining or implementing the strategy, and that European and national objectives did not match up well.
All this tarred the Lisbon Strategy's programme with a credibility deficit, which is also a result of the fact that, while it was defined in great detail, the way in which it was executed was not responsible enough. At a time of economic uncertainty, fragile public finances and high unemployment, the new 2020 strategy must be seen as an opportunity for reflection on the direction that the public wants for the European Union. Nevertheless, it will be difficult to all be headed in the same direction while the Member States and their regions - particularly the outermost regions - remain as unequal as they currently are.
Perhaps it is also time for us to develop new types of economic, financial and even budgetary links, particularly in the euro area. I am convinced that such links can make a decisive contribution to achieving the goals that are currently being set, particularly those relating to territorial cohesion.
Jarosław Leszek Wałęsa  
In March, the European Commission presented a new economic development plan for Europe. After the Lisbon Strategy, Europe 2020 is the next attempt at reviving the European economy. However, this time the challenge is more difficult, because the plan has to be put into effect in a situation of economic crisis. Smart growth, sustainable growth and inclusive growth are the priorities proposed in the new strategy, and they define where the EU wants to be by 2020.
However, before we begin to act upon these priorities, we must draw some lessons from the economic collapse, which has spread permanently across the world. The economies of Europe are strongly linked. None of the Member States is able to mount effective resistance to global threats on its own. When we act together, we are stronger, and therefore, to emerge successfully from the crisis and put the principles of Europe 2020 into effect, we need close coordination of the economic policies of all the countries of the European Union. Not doing this may lead to another lost decade, a lasting halt to growth and mass unemployment.
The new strategy is based on very ambitious ideas. In relation to this, we must make every effort so that this attempt to develop another economic strategy for Europe does not turn out to be just wishful thinking and does not end up like the Lisbon Strategy, which was supposed to transform the European Union into the most dynamic knowledge-based economy in the world by 2010, but which was a spectacular failure. Thank you.
