Today in Strasbourg, S&D Euro MP Neena Gill led a cross party majority in the European Parliament on a new EU law to protect taxpayers against having to bailout corporations when times get tough.
The legislation creates new regulations for Money Market Funds (MMFs) which represent a one trillion euro industry. The funds are used as a cash management tool by a variety of different organisations from small charities to large multi-nationals. They are used by many as a safe and reliable place to store cash until the next payroll as they offer a low-risk, low-return short-term investments. They are also important for holding short-term debts for banks, local authorities and central government – helping to make the European economy less reliant on bank funding.
Speaking after the vote Neena Gill added:
"The S&D Group has had a strong position from the outset which it has maintained and achieved greater transparency with stronger liquidity, diversification and reporting requirements plus the inclusion of a sunset clause on the newly added Low Volatility Net Asset Value.
"I strongly believe we have a sound and stable agreement that will address the concerns raised by these funds, as the result of the financial crisis in 2008.
"I am deeply disappointed by the position taken by the Greens and GUE, despite us taking on board many of their concerns, they appear to still be taking a fundamentalist point of view; it is their position or nothing. Broken down it means supporting one part of the industry at the expense of any other; disregarding the fact that this approach means continuation of the status quo and thus an unregulated MMFs industry.
"We have taken sufficient action against the vulnerabilities of MMFs through stricter liquidity, diversification requirements, a ban on sponsor support and a strong sunset clause. It is important that we get this regulation on the statute books, sooner rather later".
