Ahead of the June meeting of EU heads of state and governments, S&D Euro MPs today set out the short and longer term reforms that are necessary to complete and rebalance the economic and monetary union.
They are included in a document unveiled today, entitled: "Completing and rebalancing economic and monetary union - A democratic call".
S&D Group vice-president responsible for economic and monetary affairs Maria João Rodrigues stated:
"The euro has survived the most serious crisis it has faced since its introduction. Today the Eurozone is at risks of fragmentation due to the growing imbalances between member states. The Socialists and Democrats are convinced that without completing the economic and monetary union, Europe won't survive the next financial crisis.
"The Eurozone cannot afford to wait for the next crisis to act and to complete its reforms.
"Flaws in the initial design of the single currency have made the effects of the global economic crisis deeper and longer, generating huge economic costs, social suffering and political tensions within and between member states.
"We are calling on the heads of state and government, who will address this issue in their meeting in June, not to turn a blind eye to the challenges ahead and to set a roadmap to finish the job.
"Ultimately, the monetary union must be completed with a strong economic, fiscal and banking union. This progress must go hand in hand with a stronger democratic legitimacy."
Key proposals made by the Socialists and Democrats Group include:
• A major qualitative leap in democratic decision-making processes;
• Closer economic policy coordination and the development of an EMU economic policy based on a truly joint approach regarding the Eurozone's aggregate fiscal stance - in particular, to take proper account of the impact of aggregate EMU fiscal policy on the Eurozone’s domestic demand and its financial resources - regarded as a necessary condition for an improved macroeconomic policy mix, to allow for proper aggregate demand management and clear measures to reduce social and gender inequalities;
• Balanced monitoring of national current accounts in order to address both deficits and surpluses through country-specific recommendations in a way that supports structural convergence
• A progressive growth agenda combining much higher investment and socially balanced structural reforms;
• Common fundamental social standards and a common consolidated corporate tax base to prevent a social and a fiscal race-to-the-bottom between countries;
• An EMU fiscal capacity, encompassing own resources and a borrowing facility with two main aims:
- Providing a tailored instrument to improve the absorption of country-specific economic shocks;
- Boosting social investment, helping to restore structural convergence between Eurozone members during the crisis exit phase
