Europe cannot afford to procrastinate but needs to deliver on reforming the eurozone, say S&Ds

Europe cannot afford to procrastinate but needs to deliver on reforming eurozone, say S&Ds

S&D Euro MPs today welcomed the European Commission’s proposals to reform the eurozone and urged the EU member states to take action without delay.

In a contribution, the S&D Group sets out key priorities for reform, based on a strong social dimension, a proper budget, an ambitious sustainable investment strategy and the completion of the banking and the capital markets union. These reforms should be supported by a stronger role for the European Parliament and national parliaments and the appointment of a Commission vice-president as finance minister.

S&D Group vice-president responsible for the economic and social model Udo Bullmann MEP said:

"The Commission has done a good job analysing the weaknesses of the economic and monetary union and has drawn convincing conclusions that should be acted upon. We welcome that the Commission seems to have understood how inequalities and social divergence are tearing the euro apart. Brushing aside such social concerns and focusing on fiscal and monetary aspects would make the overhaul of the euro a failure from the start. We are pleased that the Commission has avoided this mistake and is proposing a viable and balanced approach to eurozone reform.

"Years of blind austerity have created disillusion and mistrust. To regain the trust of our citizens, we need to see a stronger and more resilient economic and monetary union (EMU). The eurozone has to become much more effective in reaching the goal of full, quality employment everywhere in the Union.

"We also need a change of spirit. In recent years, Europe has been perceived as the bogeyman handing out mainly bad marks to naughty kids. To fight this perception, the euro must deliver on its promise of improving people’s lives by fostering sustainable growth and upward social convergence. Today, the Commission has presented proposals that have the power to deliver on citizen’s expectations.

"It is now on the member states to answer this call. We urge them to take responsibility and to complete the EMU with the necessary social, fiscal and budgetary policy capabilities.

"There is no room for complacency at a time of a rising populism on both sides of the Atlantic."

S&D Group spokesperson for economic and monetary affairs Pervenche Berès MEP added:

"We are pleased that the European Commission support the European Parliament’s call in favour of a budget for the eurozone. This is one of the key reforms we need in order to stabilise the euro area in the long term. However, the euro area must be fixed now and its reform cannot be postponed until after 2019.

"We need the fiscal capacity to increase incentive for convergence without punishment between euro area members and to counter-asymmetric or symmetric economic shocks.  A transformation of the European Stability Mechanism into a European Monetary Fund would not be enough.

"Any further step towards a deepening of the EMU must go hand in hand with stronger democratic controls. To this end, the role of the European Parliament and national parliaments must be strengthened.

"Like the Commission, we also believe that the positions of the president of the Eurogroup and the Commissioner of economic and financial affairs should be merged, following the model of the high representative for foreign affairs and security policy.

"He or she should be democratically accountable and should be in charge of the fiscal capacity. This is the way forward."

The S&D Group's key priorities on the reform of the EMU include:

  • A new policy framework, comprising a revised set of rules governing macro-economic – as well as macro-social – imbalances and budgetary surveillance to meet the multiple challenges of achieving full quality employment, economic and social cohesion, efficient and fair taxation, and fiscal soundness, as well as environmental sustainability.
  • A Convergence Code, to be adopted under the ordinary legislative procedure for a five-year period to guide the euro area towards further economic, social and environmental convergence, and to ensure a more sustainable and cohesive Europe.
  • A new agenda of future-oriented reforms, in which the economic, environmental, and social dimensions of sustainable development are treated as indivisible and equal.
  • A comprehensive and ambitious sustainable investment strategy combining existing and new instruments and resources.
  • A fiscal capacity to support upward convergence and counter-asymmetric and symmetric economic shocks.
  • The completion of the banking union, including support for an accelerated clean-up of bank balance sheets to improve growth prospects, a credible European deposit-insurance scheme and a common fiscal backstop for the Single Resolution Fund.
  • Reinforced democratic ownership, legitimacy, accountability and control, based on the community method, with both a significantly reinforced role for the European Parliament at European level and of national parliaments at member state level.
  • An improved European Semester process, including the formalisation of the euro area aggregate fiscal stance as a key tool for policy formulation and implementation across the EMU.
  • A Common Corporate Consolidated Tax Base to ensure that profits are taxed where the economic value is created and to set up a fairer corporate tax system in Europe.

 

Read the full text of the S&Ds' priorities for the deepening of the economic and monetary union

Related documents 
S&Ds' priorities for the deepening of the economic and monetary union
18/05/2017