BETA


2007/2004(INI) Public finances in EMU 2006

Progress: Procedure completed

RoleCommitteeRapporteurShadows
Lead ECON LAUK Kurt Joachim (icon: PPE-DE PPE-DE)
Committee Opinion BUDG
Lead committee dossier:
Legal Basis:
RoP 52

Events

2007/07/10
   CSL - Debate in Council
Details

The Council took note of the presentation by the Commission of an annual report on developments in Member State public finances within the framework set by the EU’s stability and growth pact. It held an exchange of views, focused on the means for improving the effectiveness of the pact's preventive arm.

The Commission formulates proposals aimed at strengthening the functioning of the preventive arm of the stability and growth pact. The Council recognised the need to improve the effectiveness of the preventive arm. It called on the economic and financial committee to examine the Commission's proposals and to prepare draft conclusions for adoption by the Council at its meeting on 9 October 2007.

Documents
2007/07/10
   CSL - Council Meeting
2007/06/21
   EC - Commission response to text adopted in plenary
Documents
2007/06/05
   CSL - Resolution/conclusions adopted by Council
2007/06/05
   CSL - Council Meeting
2007/05/31
   EC - Commission response to text adopted in plenary
Documents
2007/04/26
   EP - Results of vote in Parliament
2007/04/26
   EP - Decision by Parliament, 1st reading/single reading
Details

The European Parliament adopted a resolution based on the own-initiative report by Kurt Joachim Lauk (EPP-ED, DE) on public finances in EMU in 2006. The report was adopted by 277 votes in favour to 142 against with 130 amendments. Parliament felt that the rule regarding budget deficits below 3% had been regularly flouted. The average debt ratio for the euro area was 70.6% in 2005 and around 69.4% in 2006 and is projected to fall to 68% in 2007. These figures are still much higher than the reference value of 60% for the debt-GDP ratio, one of the two pillars of the stability and Growth Pact (SGP).

Experiences with the revised SGP: Parliament welcomed the fact that many Member States had made a considerable effort in trying to meet their obligations with regard to the SGP, but pointed out that it was still too early to evaluate the results obtained following the coming into force of the revised SGP. It shared the Commission's concerns regarding the implementation of the preventive arm of the SGP, especially with regard to those Member States which had not yet managed to balance their public finances. The revised SGP, in particular its corrective arm, entails a risk of high public debt if enforced leniently. Parliament stressed that the attitude of the Member States towards the revised SGP would ultimately decide the success or failure of the SGP.

It was concerned that the different spreads among the Member States in the fields of deficit, debt and growth might widen, which could have the effect of undermining the single currency, stifling economic growth and reducing employment prospects. Parliament was also concerned about the slow pace of public debt reduction in some Member States. It opposed never-ending and inconclusive deficit procedures and urged the Council and the Commission to act in a swift and decisive manner. The credibility of the excessive deficit procedure should be maintained and Member States should continue to be judged according to the same single standard.

Violations of the SGP could ultimately undermine the common monetary policy and add to the pressure to increase interest rates. Accordingly, there was an urgent need for the Member States to adapt their fiscal policies to the requirements of the common Economic and Monetary Policy. Parliament welcomed the fact that the revised SGP allowed for reform programmes to be developed that have realistic deadlines and medium-term budgetary targets, and agreed that tailor-made reform programmes adapted to Member States' needs should allow for better implementation of the preventive arm of the SGP.

Challenges ahead: Parliament was alarmed by the Commission's projections showing a dramatic increase in age-related expenditure whilst long-term growth prospects showed a future decline. This will inevitably put enormous pressure on the sustainability of the Member States' public finances. It was concerned that six Member States were considered to be exposed to a high risk as regards the long-term sustainability of their public finances as a result of the budgetary impact of ageing populations, while ten other Member States were regarded to be facing a medium risk, and only nine Member States a low risk.

Parliament urged that such a major EU budgetary challenge be addressed. The reduction of public debt should be accelerated during periods of economic upturn whilst avoiding pro-cyclical measures. Structural and tax reforms must be implemented to improve the economic performance of Member States. Member States must use the current upswing in the economy to conduct necessary reforms in the labour market, services sector and reduce administrative burdens on business.

Parliament went on to urge Member States to avoid unsubstantiated budgetary projections and to refrain from one-off measures and creative accounting. The Council should ensure that Member States running an unsustainable public debt render new public debt either unconstitutional or unlawful by 2015, thus drawing on the best practices of certain Member States and regions in the EU. Welcoming the recent agreements of the Eurogroup to discuss budgetary projections in order to determine ex ante the appropriate fiscal strategy for the respective following year, Parliament was convinced that a public debate on those projections should take place in the European Parliament together with representatives of national parliaments.

Parliament warned Member States to report statistics that were of a high standard to the Commission in order to ensure that public deficit and debt could be compared. The Commission should check vigorously the quality of statistics reported by Member States.

Lastly, Parliament deplored the lack of policy coordination in the euro-zone, and drew attention to the divergence in fiscal policies of the Member States in the euro-zone. It expressed concern about possible antagonistic effects of such a lack of coordination. Parliament encouraged further research into the different kinds of structural and macroeconomic reform and their interaction and mutual impact at different phases of the economic cycle in order to identify the best possible means of strengthening public finances while at the same time achieving the Lisbon Strategy.

Documents
2007/04/26
   EP - End of procedure in Parliament
2007/04/25
   EP - Debate in Parliament
2007/03/26
   EP - Committee report tabled for plenary, single reading
Documents
2007/03/26
   EP - Committee report tabled for plenary, single reading
Documents
2007/03/21
   EP - Vote in committee, 1st reading/single reading
2007/03/05
   EP - Amendments tabled in committee
Documents
2007/02/06
   EP - Committee draft report
Documents
2007/01/18
   EP - Committee referral announced in Parliament, 1st reading/single reading
2006/07/04
   EP - LAUK Kurt Joachim (PPE-DE) appointed as rapporteur in ECON
2006/06/13
   EC - Non-legislative basic document published
Details

PURPOSE: to review implementation of the revised Stability and Growth Pact.

BACKGROUND: in 2005, the EU Heads of Government endorsed a revised Stability and Growth Pact (SGP) by approving:

- Council Regulation 1055/2005/EC amending Regulation 1466/97/EC on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies (for a summary see SYN/2005/0064 ) and

- Council Regulation 1056/2005/EC on amending Regulation 1467/97/EC (see CNS/2005/0061 )

The 2005 SGP reform confirmed the fundamental rules and principles of the Treaty and re-established the consensus for sound fiscal policies. The 3% and 60% ceilings for government deficit and debt remain the same. The changes that have been made, however, are as follows:

- the early identification, and prompt correction of, excessive deficits;

- increased flexibility;

- the implementation of structural policies that enhance growth potential and the long-term sustainability of government finances in line with the Lisbon strategy for growth and jobs;

- the strengthening of budgetary consolidation efforts in times of economic growth;

- setting a clearer link to country-specific situations;

- making decisions in relation to the “excessive deficit procedure” based on an overall economic analysis; and

- increasing focus on structural fiscal consolidation rather than on short-term national results.

This new framework entered into force in summer 2005. One year on and the Commission has prepared this Communication in order to review the implementation of the revised SGP.

CONTENT: in its report, the Commission finds that experience, thus far, is positive. Overall, the budgetary adjustments have resumed and there has been a smooth and consistent implementation of the SGP procedures. Some concerns are emerging regarding the implementation of the preventative arm of the Pact and it remains unclear whether fiscal consolidation needs to be stepped up in line with upbeat growth prospects. Success will be measured on Member States’ ability to achieve fiscal adjustment in the years ahead.

Since March 2005 the Commission has had to prepare only three reports on Member States whose deficit exceeds 3% of GDP. Further, co-operation between the Commission and the Council has improved. Experience shows that by introducing more room for economic judgement in the fiscal surveillance process, the reform has stimulated a constructive and transparent economic policy dialogue at an EU level on the individual country cases. As a result peer support has been strengthened.

However, in spite of clear improvements, the Commission notes that questions remain vis-à-vis the credibility of the medium-term budgetary adjustments planned by the Member States. Experience with the original SGP highlighted, that to be credible, medium-term budgetary plans needed to be based on realistic and cautious macroeconomic forecasts and underpinned by permanent measures and structural reforms. On this point, the Commission’s assessment is mixed.

An encouraging feature of the last round of Stability and Convergence Programmes is that medium-term budgetary projections are, in almost all cases, based on realistic macroeconomic assumptions. This constitutes a major improvement on previous years when budgetary forecasts were typically based on overly optimistic macroeconomic forecasts.

A further positive departure is that recourse to one-off and other temporary measures within a medium-term planning has vanished. Such measures represent less than 0.1% of the EU GDP in 2006 and are negligible in 2007 and 2008. In a number of cases, however, the measures underlying the envisaged consolidation are not sufficiently specified. The combination, in some programmes, of a back-loaded fiscal adjustment with a lack of specification of measures underlying the projected consolidation is a source of concern.

The future challenges identified by the Commission, in the years ahead, include:

- ensuring that the spirit of the reforms are followed through during good times;

- focusing on the sustainability of government finances;

- improving statistical governance;

- offering improved synergies between fiscal policy and growth; and

- supporting fiscal rules and institutions at national level.

To conclude, the one year experience with the revised SGP indicates that the EU’s fiscal framework is gaining in credibility. It has permitted an enhanced economic rationale of the rules; it has increased Member State involvement in the framework; and it has introduced a more co-operative relationship amongst the participants. These developments warrant some optimism regarding future implementation plans.

Documents

Votes

Rapport Lauk A6-0076/2007 - am. 12

2007/04/26 Outcome: -: 344, +: 204, 0: 42
MT AT PT FR ES BG DK EE LU CY SI FI NL BE LT SK SE IE EL LV CZ HU RO DE IT GB PL
Total
4
15
18
63
39
10
9
6
5
1
6
11
26
21
7
12
16
7
14
9
16
20
30
82
45
49
49
icon: PSE PSE
171

Estonia PSE

3

Luxembourg PSE

For (1)

1

Slovenia PSE

For (1)

1

Lithuania PSE

2

Sweden PSE

Abstain (1)

4

Ireland PSE

1

Czechia PSE

2
icon: Verts/ALE Verts/ALE
34

Austria Verts/ALE

2

Spain Verts/ALE

2

Luxembourg Verts/ALE

For (1)

1

Finland Verts/ALE

For (1)

1

Belgium Verts/ALE

2

Sweden Verts/ALE

For (1)

1

Latvia Verts/ALE

1

Italy Verts/ALE

2

United Kingdom Verts/ALE

2
icon: NI NI
6

Austria NI

Abstain (1)

1

Slovakia NI

1

Italy NI

1

United Kingdom NI

Against (1)

Abstain (1)

2

Poland NI

Abstain (1)

1
icon: GUE/NGL GUE/NGL
28

Portugal GUE/NGL

3

France GUE/NGL

2

Spain GUE/NGL

Abstain (1)

1

Denmark GUE/NGL

1

Finland GUE/NGL

Abstain (1)

1

Netherlands GUE/NGL

2

Sweden GUE/NGL

2

Greece GUE/NGL

Against (1)

2
icon: IND/DEM IND/DEM
16

France IND/DEM

2

Denmark IND/DEM

Against (1)

1

Netherlands IND/DEM

2

Sweden IND/DEM

2

Greece IND/DEM

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1

Czechia IND/DEM

Against (1)

1

United Kingdom IND/DEM

4

Poland IND/DEM

3
icon: ITS ITS
19

Austria ITS

Against (1)

1

Belgium ITS

2

Italy ITS

2

United Kingdom ITS

Against (1)

1
icon: UEN UEN
29

Lithuania UEN

Against (1)

1

Ireland UEN

3
icon: ALDE ALDE
71

Austria ALDE

Against (1)

1
2

Bulgaria ALDE

3

Denmark ALDE

Against (2)

2

Estonia ALDE

Against (2)

2

Slovenia ALDE

Against (1)

2

Finland ALDE

2

Sweden ALDE

Against (1)

1

Latvia ALDE

Against (1)

1

Hungary ALDE

2
icon: PPE-DE PPE-DE
216

Malta PPE-DE

Against (1)

1
4

Bulgaria PPE-DE

2

Denmark PPE-DE

Against (1)

1

Estonia PPE-DE

Against (1)

1

Luxembourg PPE-DE

3

Cyprus PPE-DE

Against (1)

1

Slovenia PPE-DE

3

Lithuania PPE-DE

1

Ireland PPE-DE

3

Latvia PPE-DE

3

Rapport Lauk A6-0076/2007 - ams. 8+14

2007/04/26 Outcome: -: 283, +: 278, 0: 7
GB FR IT SE AT ES PT DK BE MT RO IE EE FI BG LU NL PL CY CZ EL SK LT SI LV DE HU
Total
46
58
42
16
15
38
18
9
21
5
31
8
6
11
9
5
25
38
2
15
14
13
7
6
9
80
21
icon: PSE PSE
163

Ireland PSE

1

Estonia PSE

3

Luxembourg PSE

For (1)

1

Czechia PSE

2

Lithuania PSE

2

Slovenia PSE

For (1)

1
icon: Verts/ALE Verts/ALE
33

United Kingdom Verts/ALE

2

Italy Verts/ALE

2

Sweden Verts/ALE

For (1)

1

Austria Verts/ALE

2

Spain Verts/ALE

2

Belgium Verts/ALE

2

Finland Verts/ALE

For (1)

1

Luxembourg Verts/ALE

For (1)

1

Latvia Verts/ALE

1
icon: GUE/NGL GUE/NGL
26

France GUE/NGL

2

Sweden GUE/NGL

2

Spain GUE/NGL

For (1)

1

Portugal GUE/NGL

2

Denmark GUE/NGL

1

Finland GUE/NGL

For (1)

1

Netherlands GUE/NGL

2

Greece GUE/NGL

2
icon: ITS ITS
17

United Kingdom ITS

Against (1)

1
2

Austria ITS

For (1)

1

Belgium ITS

2
icon: UEN UEN
21

Italy UEN

Abstain (1)

3

Lithuania UEN

Against (1)

1
icon: NI NI
6

United Kingdom NI

For (1)

1

Italy NI

1

Austria NI

Abstain (1)

1

Poland NI

Against (1)

1

Slovakia NI

2
icon: IND/DEM IND/DEM
16

United Kingdom IND/DEM

4

France IND/DEM

2

Sweden IND/DEM

2

Denmark IND/DEM

Abstain (1)

1

Netherlands IND/DEM

2

Poland IND/DEM

3

Czechia IND/DEM

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1

Greece IND/DEM

Abstain (1)

1
icon: ALDE ALDE
70

Sweden ALDE

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1

Austria ALDE

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1

Spain ALDE

2

Denmark ALDE

Against (2)

2

Estonia ALDE

Against (2)

2

Finland ALDE

2

Bulgaria ALDE

3

Cyprus ALDE

Against (1)

1

Slovenia ALDE

2

Latvia ALDE

Against (1)

1

Hungary ALDE

2
icon: PPE-DE PPE-DE
216
4

Denmark PPE-DE

Against (1)

1

Malta PPE-DE

Against (2)

2
4

Estonia PPE-DE

Against (1)

1

Bulgaria PPE-DE

2

Luxembourg PPE-DE

3

Cyprus PPE-DE

Against (1)

1

Lithuania PPE-DE

1

Slovenia PPE-DE

3

Latvia PPE-DE

3

Rapport Lauk A6-0076/2007 - am. 1

2007/04/26 Outcome: -: 335, +: 212, 0: 35
SK HU LV CZ EL DE LU ES SI CY MT SE FI LT NL PT BG EE DK AT PL IE RO BE IT GB FR
Total
13
21
9
15
14
80
5
40
6
2
5
16
11
7
25
20
10
6
9
15
39
8
31
21
41
49
64
icon: PPE-DE PPE-DE
218

Luxembourg PPE-DE

3

Slovenia PPE-DE

3

Cyprus PPE-DE

1

Malta PPE-DE

2

Lithuania PPE-DE

1

Bulgaria PPE-DE

2

Estonia PPE-DE

For (1)

1

Denmark PPE-DE

For (1)

1
4
icon: NI NI
7

Slovakia NI

Abstain (1)

2

Austria NI

Abstain (1)

1

Poland NI

1

Italy NI

1

United Kingdom NI

Abstain (2)

2
icon: IND/DEM IND/DEM
16

Czechia IND/DEM

Abstain (1)

1

Greece IND/DEM

Against (1)

1

Sweden IND/DEM

2

Netherlands IND/DEM

2

Denmark IND/DEM

Abstain (1)

1

United Kingdom IND/DEM

4

France IND/DEM

2
icon: UEN UEN
22

Lithuania UEN

1

Ireland UEN

3
icon: ITS ITS
19

Austria ITS

Against (1)

1

Belgium ITS

2

Italy ITS

2

United Kingdom ITS

Abstain (1)

1
icon: GUE/NGL GUE/NGL
28
4

Greece GUE/NGL

2

Spain GUE/NGL

Against (1)

1

Sweden GUE/NGL

2

Finland GUE/NGL

Abstain (1)

1

Netherlands GUE/NGL

2

Portugal GUE/NGL

3

Denmark GUE/NGL

1

France GUE/NGL

2
icon: Verts/ALE Verts/ALE
34

Latvia Verts/ALE

Against (1)

1

Luxembourg Verts/ALE

Against (1)

1

Spain Verts/ALE

2

Sweden Verts/ALE

Against (1)

1

Finland Verts/ALE

Against (1)

1

Austria Verts/ALE

2

Belgium Verts/ALE

2

Italy Verts/ALE

2

United Kingdom Verts/ALE

2
icon: ALDE ALDE
72

Hungary ALDE

2

Latvia ALDE

Against (1)

1

Spain ALDE

2

Slovenia ALDE

2

Cyprus ALDE

Against (1)

1

Sweden ALDE

Against (1)

1

Finland ALDE

2

Bulgaria ALDE

3

Estonia ALDE

Against (2)

2

Denmark ALDE

Against (2)

2

Austria ALDE

Against (1)

1
icon: PSE PSE
166

Slovakia PSE

3

Czechia PSE

2

Luxembourg PSE

Against (1)

1

Slovenia PSE

Against (1)

1

Finland PSE

3

Lithuania PSE

2

Estonia PSE

3

Ireland PSE

Against (1)

1

Rapport Lauk A6-0076/2007 - résolution

2007/04/26 Outcome: +: 277, -: 142, 0: 130
DE ES HU RO IT GB PL NL SK LV SI BG LT FI EL EE CY AT PT LU IE DK BE MT SE CZ FR
Total
80
36
20
30
44
45
38
26
11
7
5
10
7
9
12
4
2
14
17
5
7
8
18
3
14
13
64
icon: PPE-DE PPE-DE
205

Slovenia PPE-DE

3

Bulgaria PPE-DE

2

Lithuania PPE-DE

1

Estonia PPE-DE

For (1)

1

Cyprus PPE-DE

1

Luxembourg PPE-DE

3

Ireland PPE-DE

Against (2)

3

Denmark PPE-DE

For (1)

1

Malta PPE-DE

For (1)

1
icon: ALDE ALDE
72
2

Latvia ALDE

1

Slovenia ALDE

2

Finland ALDE

2

Estonia ALDE

2

Cyprus ALDE

For (1)

1

Austria ALDE

1

Denmark ALDE

2

Sweden ALDE

For (1)

1
icon: UEN UEN
20

Latvia UEN

2

Lithuania UEN

1
icon: NI NI
4

Italy NI

1

Poland NI

Against (1)

1

Slovakia NI

Abstain (1)

1

Austria NI

Against (1)

1
icon: IND/DEM IND/DEM
14

United Kingdom IND/DEM

4

Poland IND/DEM

3

Netherlands IND/DEM

2

Sweden IND/DEM

2

Czechia IND/DEM

Against (1)

1

France IND/DEM

2
icon: ITS ITS
18

Italy ITS

2

Austria ITS

Against (1)

1

Belgium ITS

2
icon: PSE PSE
159

Slovakia PSE

3

Lithuania PSE

Against (1)

2

Finland PSE

For (1)

Abstain (1)

2

Greece PSE

Against (1)

3

Estonia PSE

Abstain (1)

1

Luxembourg PSE

Abstain (1)

1

Ireland PSE

Abstain (1)

1

Malta PSE

2

Sweden PSE

Against (1)

4

Czechia PSE

2
icon: GUE/NGL GUE/NGL
25

Spain GUE/NGL

Against (1)

1

Netherlands GUE/NGL

2

Finland GUE/NGL

Against (1)

1

Greece GUE/NGL

2

Portugal GUE/NGL

2

Denmark GUE/NGL

1

Sweden GUE/NGL

2

Czechia GUE/NGL

2

France GUE/NGL

2
icon: Verts/ALE Verts/ALE
32

Spain Verts/ALE

2

Italy Verts/ALE

2

United Kingdom Verts/ALE

Against (1)

1

Latvia Verts/ALE

Against (1)

1

Finland Verts/ALE

Against (1)

1

Austria Verts/ALE

Against (1)

1

Luxembourg Verts/ALE

Against (1)

1

Belgium Verts/ALE

2

Sweden Verts/ALE

Against (1)

1

History

(these mark the time of scraping, not the official date of the change)

committees/0
type
Responsible Committee
body
EP
associated
False
committee_full
Economic and Monetary Affairs
committee
ECON
rapporteur
name: LAUK Kurt Joachim date: 2006-07-04T00:00:00 group: European People's Party (Christian Democrats) and European Democrats abbr: PPE-DE
committees/0
type
Responsible Committee
body
EP
associated
False
committee_full
Economic and Monetary Affairs
committee
ECON
date
2006-07-04T00:00:00
rapporteur
name: LAUK Kurt Joachim group: European People's Party (Christian Democrats) and European Democrats abbr: PPE-DE
docs/2/docs/0/url
Old
http://www.europarl.europa.eu/sides/getDoc.do?type=REPORT&mode=XML&reference=A6-2007-76&language=EN
New
http://www.europarl.europa.eu/doceo/document/A-6-2007-0076_EN.html
docs/3/body
EC
docs/4/body
EC
events/0/docs/0/url
Old
http://www.europarl.europa.eu/RegData/docs_autres_institutions/commission_europeenne/com/2006/0304/COM_COM(2006)0304_EN.pdf
New
http://www.europarl.europa.eu/registre/docs_autres_institutions/commission_europeenne/com/2006/0304/COM_COM(2006)0304_EN.pdf
events/3/docs/0/url
Old
http://www.europarl.europa.eu/sides/getDoc.do?type=REPORT&mode=XML&reference=A6-2007-76&language=EN
New
http://www.europarl.europa.eu/doceo/document/A-6-2007-0076_EN.html
events/6/docs/0/url
Old
http://www.europarl.europa.eu/sides/getDoc.do?type=TA&language=EN&reference=P6-TA-2007-168
New
http://www.europarl.europa.eu/doceo/document/TA-6-2007-0168_EN.html
activities
  • date: 2006-06-13T00:00:00 docs: url: http://www.europarl.europa.eu/RegData/docs_autres_institutions/commission_europeenne/com/2006/0304/COM_COM(2006)0304_EN.pdf title: COM(2006)0304 type: Non-legislative basic document published celexid: CELEX:52006DC0304:EN body: EC commission: DG: url: http://ec.europa.eu/dgs/economy_finance/index_en.htm title: Economic and Financial Affairs Commissioner: ALMUNIA Joaquín type: Non-legislative basic document published
  • date: 2007-01-18T00:00:00 body: EP type: Committee referral announced in Parliament, 1st reading/single reading committees: body: EP responsible: False committee_full: Budgets committee: BUDG body: EP responsible: True committee: ECON date: 2006-07-04T00:00:00 committee_full: Economic and Monetary Affairs rapporteur: group: PPE-DE name: LAUK Kurt Joachim
  • date: 2007-03-21T00:00:00 body: EP type: Vote in committee, 1st reading/single reading committees: body: EP responsible: False committee_full: Budgets committee: BUDG body: EP responsible: True committee: ECON date: 2006-07-04T00:00:00 committee_full: Economic and Monetary Affairs rapporteur: group: PPE-DE name: LAUK Kurt Joachim
  • date: 2007-03-26T00:00:00 docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=REPORT&mode=XML&reference=A6-2007-76&language=EN type: Committee report tabled for plenary, single reading title: A6-0076/2007 body: EP type: Committee report tabled for plenary, single reading
  • date: 2007-04-25T00:00:00 docs: url: http://www.europarl.europa.eu/sides/getDoc.do?secondRef=TOC&language=EN&reference=20070425&type=CRE type: Debate in Parliament title: Debate in Parliament body: EP type: Debate in Parliament
  • date: 2007-04-26T00:00:00 docs: url: http://www.europarl.europa.eu/oeil/popups/sda.do?id=13440&l=en type: Results of vote in Parliament title: Results of vote in Parliament url: http://www.europarl.europa.eu/sides/getDoc.do?type=TA&language=EN&reference=P6-TA-2007-168 type: Decision by Parliament, 1st reading/single reading title: T6-0168/2007 body: EP type: Results of vote in Parliament
  • date: 2007-06-05T00:00:00 body: CSL type: Council Meeting council: Economic and Financial Affairs ECOFIN meeting_id: 2804
  • body: CSL meeting_id: 2813 docs: url: http://register.consilium.europa.eu/content/out?lang=EN&typ=SET&i=SMPL&ROWSPP=25&RESULTSET=1&NRROWS=500&DOC_LANCD=EN&ORDERBY=DOC_DATE+DESC&CONTENTS=2813*&MEET_DATE=10/07/2007 type: Debate in Council title: 2813 council: Economic and Financial Affairs ECOFIN date: 2007-07-10T00:00:00 type: Council Meeting
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  • body: EC dg: Economic and Financial Affairs commissioner: ALMUNIA Joaquín
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  • body: CSL type: Council Meeting council: Economic and Financial Affairs ECOFIN meeting_id: 2813 url: http://register.consilium.europa.eu/content/out?lang=EN&typ=SET&i=SMPL&ROWSPP=25&RESULTSET=1&NRROWS=500&DOC_LANCD=EN&ORDERBY=DOC_DATE+DESC&CONTENTS=2813*&MEET_DATE=10/07/2007 date: 2007-07-10T00:00:00
  • body: CSL type: Council Meeting council: Economic and Financial Affairs ECOFIN meeting_id: 2804 url: http://register.consilium.europa.eu/content/out?lang=EN&typ=SET&i=SMPL&ROWSPP=25&RESULTSET=1&NRROWS=500&DOC_LANCD=EN&ORDERBY=DOC_DATE+DESC&CONTENTS=2804*&MEET_DATE=05/06/2007 date: 2007-06-05T00:00:00
docs
  • date: 2007-02-06T00:00:00 docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=COMPARL&mode=XML&language=EN&reference=PE382.460 title: PE382.460 type: Committee draft report body: EP
  • date: 2007-03-05T00:00:00 docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=COMPARL&mode=XML&language=EN&reference=PE384.510 title: PE384.510 type: Amendments tabled in committee body: EP
  • date: 2007-03-26T00:00:00 docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=REPORT&mode=XML&reference=A6-2007-76&language=EN title: A6-0076/2007 type: Committee report tabled for plenary, single reading body: EP
  • date: 2007-05-31T00:00:00 docs: url: /oeil/spdoc.do?i=13440&j=1&l=en title: SP(2007)2625/2 type: Commission response to text adopted in plenary
  • date: 2007-06-21T00:00:00 docs: url: /oeil/spdoc.do?i=13440&j=0&l=en title: SP(2007)3180 type: Commission response to text adopted in plenary
events
  • date: 2006-06-13T00:00:00 type: Non-legislative basic document published body: EC docs: url: http://www.europarl.europa.eu/RegData/docs_autres_institutions/commission_europeenne/com/2006/0304/COM_COM(2006)0304_EN.pdf title: COM(2006)0304 url: https://eur-lex.europa.eu/smartapi/cgi/sga_doc?smartapi!celexplus!prod!DocNumber&lg=EN&type_doc=COMfinal&an_doc=2006&nu_doc=304 title: EUR-Lex summary: PURPOSE: to review implementation of the revised Stability and Growth Pact. BACKGROUND: in 2005, the EU Heads of Government endorsed a revised Stability and Growth Pact (SGP) by approving: - Council Regulation 1055/2005/EC amending Regulation 1466/97/EC on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies (for a summary see SYN/2005/0064 ) and - Council Regulation 1056/2005/EC on amending Regulation 1467/97/EC (see CNS/2005/0061 ) The 2005 SGP reform confirmed the fundamental rules and principles of the Treaty and re-established the consensus for sound fiscal policies. The 3% and 60% ceilings for government deficit and debt remain the same. The changes that have been made, however, are as follows: - the early identification, and prompt correction of, excessive deficits; - increased flexibility; - the implementation of structural policies that enhance growth potential and the long-term sustainability of government finances in line with the Lisbon strategy for growth and jobs; - the strengthening of budgetary consolidation efforts in times of economic growth; - setting a clearer link to country-specific situations; - making decisions in relation to the “excessive deficit procedure” based on an overall economic analysis; and - increasing focus on structural fiscal consolidation rather than on short-term national results. This new framework entered into force in summer 2005. One year on and the Commission has prepared this Communication in order to review the implementation of the revised SGP. CONTENT: in its report, the Commission finds that experience, thus far, is positive. Overall, the budgetary adjustments have resumed and there has been a smooth and consistent implementation of the SGP procedures. Some concerns are emerging regarding the implementation of the preventative arm of the Pact and it remains unclear whether fiscal consolidation needs to be stepped up in line with upbeat growth prospects. Success will be measured on Member States’ ability to achieve fiscal adjustment in the years ahead. Since March 2005 the Commission has had to prepare only three reports on Member States whose deficit exceeds 3% of GDP. Further, co-operation between the Commission and the Council has improved. Experience shows that by introducing more room for economic judgement in the fiscal surveillance process, the reform has stimulated a constructive and transparent economic policy dialogue at an EU level on the individual country cases. As a result peer support has been strengthened. However, in spite of clear improvements, the Commission notes that questions remain vis-à-vis the credibility of the medium-term budgetary adjustments planned by the Member States. Experience with the original SGP highlighted, that to be credible, medium-term budgetary plans needed to be based on realistic and cautious macroeconomic forecasts and underpinned by permanent measures and structural reforms. On this point, the Commission’s assessment is mixed. An encouraging feature of the last round of Stability and Convergence Programmes is that medium-term budgetary projections are, in almost all cases, based on realistic macroeconomic assumptions. This constitutes a major improvement on previous years when budgetary forecasts were typically based on overly optimistic macroeconomic forecasts. A further positive departure is that recourse to one-off and other temporary measures within a medium-term planning has vanished. Such measures represent less than 0.1% of the EU GDP in 2006 and are negligible in 2007 and 2008. In a number of cases, however, the measures underlying the envisaged consolidation are not sufficiently specified. The combination, in some programmes, of a back-loaded fiscal adjustment with a lack of specification of measures underlying the projected consolidation is a source of concern. The future challenges identified by the Commission, in the years ahead, include: - ensuring that the spirit of the reforms are followed through during good times; - focusing on the sustainability of government finances; - improving statistical governance; - offering improved synergies between fiscal policy and growth; and - supporting fiscal rules and institutions at national level. To conclude, the one year experience with the revised SGP indicates that the EU’s fiscal framework is gaining in credibility. It has permitted an enhanced economic rationale of the rules; it has increased Member State involvement in the framework; and it has introduced a more co-operative relationship amongst the participants. These developments warrant some optimism regarding future implementation plans.
  • date: 2007-01-18T00:00:00 type: Committee referral announced in Parliament, 1st reading/single reading body: EP
  • date: 2007-03-21T00:00:00 type: Vote in committee, 1st reading/single reading body: EP
  • date: 2007-03-26T00:00:00 type: Committee report tabled for plenary, single reading body: EP docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=REPORT&mode=XML&reference=A6-2007-76&language=EN title: A6-0076/2007
  • date: 2007-04-25T00:00:00 type: Debate in Parliament body: EP docs: url: http://www.europarl.europa.eu/sides/getDoc.do?secondRef=TOC&language=EN&reference=20070425&type=CRE title: Debate in Parliament
  • date: 2007-04-26T00:00:00 type: Results of vote in Parliament body: EP docs: url: https://oeil.secure.europarl.europa.eu/oeil/popups/sda.do?id=13440&l=en title: Results of vote in Parliament
  • date: 2007-04-26T00:00:00 type: Decision by Parliament, 1st reading/single reading body: EP docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=TA&language=EN&reference=P6-TA-2007-168 title: T6-0168/2007 summary: The European Parliament adopted a resolution based on the own-initiative report by Kurt Joachim Lauk (EPP-ED, DE) on public finances in EMU in 2006. The report was adopted by 277 votes in favour to 142 against with 130 amendments. Parliament felt that the rule regarding budget deficits below 3% had been regularly flouted. The average debt ratio for the euro area was 70.6% in 2005 and around 69.4% in 2006 and is projected to fall to 68% in 2007. These figures are still much higher than the reference value of 60% for the debt-GDP ratio, one of the two pillars of the stability and Growth Pact (SGP). Experiences with the revised SGP: Parliament welcomed the fact that many Member States had made a considerable effort in trying to meet their obligations with regard to the SGP, but pointed out that it was still too early to evaluate the results obtained following the coming into force of the revised SGP. It shared the Commission's concerns regarding the implementation of the preventive arm of the SGP, especially with regard to those Member States which had not yet managed to balance their public finances. The revised SGP, in particular its corrective arm, entails a risk of high public debt if enforced leniently. Parliament stressed that the attitude of the Member States towards the revised SGP would ultimately decide the success or failure of the SGP. It was concerned that the different spreads among the Member States in the fields of deficit, debt and growth might widen, which could have the effect of undermining the single currency, stifling economic growth and reducing employment prospects. Parliament was also concerned about the slow pace of public debt reduction in some Member States. It opposed never-ending and inconclusive deficit procedures and urged the Council and the Commission to act in a swift and decisive manner. The credibility of the excessive deficit procedure should be maintained and Member States should continue to be judged according to the same single standard. Violations of the SGP could ultimately undermine the common monetary policy and add to the pressure to increase interest rates. Accordingly, there was an urgent need for the Member States to adapt their fiscal policies to the requirements of the common Economic and Monetary Policy. Parliament welcomed the fact that the revised SGP allowed for reform programmes to be developed that have realistic deadlines and medium-term budgetary targets, and agreed that tailor-made reform programmes adapted to Member States' needs should allow for better implementation of the preventive arm of the SGP. Challenges ahead: Parliament was alarmed by the Commission's projections showing a dramatic increase in age-related expenditure whilst long-term growth prospects showed a future decline. This will inevitably put enormous pressure on the sustainability of the Member States' public finances. It was concerned that six Member States were considered to be exposed to a high risk as regards the long-term sustainability of their public finances as a result of the budgetary impact of ageing populations, while ten other Member States were regarded to be facing a medium risk, and only nine Member States a low risk. Parliament urged that such a major EU budgetary challenge be addressed. The reduction of public debt should be accelerated during periods of economic upturn whilst avoiding pro-cyclical measures. Structural and tax reforms must be implemented to improve the economic performance of Member States. Member States must use the current upswing in the economy to conduct necessary reforms in the labour market, services sector and reduce administrative burdens on business. Parliament went on to urge Member States to avoid unsubstantiated budgetary projections and to refrain from one-off measures and creative accounting. The Council should ensure that Member States running an unsustainable public debt render new public debt either unconstitutional or unlawful by 2015, thus drawing on the best practices of certain Member States and regions in the EU. Welcoming the recent agreements of the Eurogroup to discuss budgetary projections in order to determine ex ante the appropriate fiscal strategy for the respective following year, Parliament was convinced that a public debate on those projections should take place in the European Parliament together with representatives of national parliaments. Parliament warned Member States to report statistics that were of a high standard to the Commission in order to ensure that public deficit and debt could be compared. The Commission should check vigorously the quality of statistics reported by Member States. Lastly, Parliament deplored the lack of policy coordination in the euro-zone, and drew attention to the divergence in fiscal policies of the Member States in the euro-zone. It expressed concern about possible antagonistic effects of such a lack of coordination. Parliament encouraged further research into the different kinds of structural and macroeconomic reform and their interaction and mutual impact at different phases of the economic cycle in order to identify the best possible means of strengthening public finances while at the same time achieving the Lisbon Strategy.
  • date: 2007-04-26T00:00:00 type: End of procedure in Parliament body: EP
  • date: 2007-06-05T00:00:00 type: Resolution/conclusions adopted by Council body: CSL
  • date: 2007-07-10T00:00:00 type: Debate in Council body: CSL docs: url: http://register.consilium.europa.eu/content/out?lang=EN&typ=SET&i=SMPL&ROWSPP=25&RESULTSET=1&NRROWS=500&DOC_LANCD=EN&ORDERBY=DOC_DATE+DESC&CONTENTS=2813*&MEET_DATE=10/07/2007 title: 2813 summary: The Council took note of the presentation by the Commission of an annual report on developments in Member State public finances within the framework set by the EU’s stability and growth pact. It held an exchange of views, focused on the means for improving the effectiveness of the pact's preventive arm. The Commission formulates proposals aimed at strengthening the functioning of the preventive arm of the stability and growth pact. The Council recognised the need to improve the effectiveness of the preventive arm. It called on the economic and financial committee to examine the Commission's proposals and to prepare draft conclusions for adoption by the Council at its meeting on 9 October 2007.
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  • body: CSL type: Council Meeting council: Former Council configuration
  • body: EC dg: url: http://ec.europa.eu/dgs/economy_finance/index_en.htm title: Economic and Financial Affairs commissioner: ALMUNIA Joaquín
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ECON/6/42503
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  • ECON/6/42503
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Rules of Procedure EP 52
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Rules of Procedure of the European Parliament EP 052
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Old
  • 5.10 Economic union
  • 5.10.01 Convergence of economic policies, public deficit, interest rates
  • 5.20 Monetary union
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5.20.01
Coordination of monetary policies, European Monetary Institute (EMI), Economic and Monetary Union (EMU)
procedure/title
Old
Public Finances in EMU 2006
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Public finances in EMU 2006
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http://www.europarl.europa.eu/registre/docs_autres_institutions/commission_europeenne/com/2006/0304/COM_COM(2006)0304_EN.pdf
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http://www.europarl.europa.eu/RegData/docs_autres_institutions/commission_europeenne/com/2006/0304/COM_COM(2006)0304_EN.pdf
activities
  • date: 2006-06-13T00:00:00 docs: url: http://www.europarl.europa.eu/registre/docs_autres_institutions/commission_europeenne/com/2006/0304/COM_COM(2006)0304_EN.pdf celexid: CELEX:52006DC0304:EN type: Non-legislative basic document published title: COM(2006)0304 type: Non-legislative basic document published body: EC commission: DG: url: http://ec.europa.eu/dgs/economy_finance/index_en.htm title: Economic and Financial Affairs Commissioner: ALMUNIA Joaquín
  • date: 2007-01-18T00:00:00 body: EP type: Committee referral announced in Parliament, 1st reading/single reading committees: body: EP responsible: False committee_full: Budgets committee: BUDG body: EP responsible: True committee: ECON date: 2006-07-04T00:00:00 committee_full: Economic and Monetary Affairs rapporteur: group: PPE-DE name: LAUK Kurt Joachim
  • date: 2007-03-21T00:00:00 body: EP type: Vote in committee, 1st reading/single reading committees: body: EP responsible: False committee_full: Budgets committee: BUDG body: EP responsible: True committee: ECON date: 2006-07-04T00:00:00 committee_full: Economic and Monetary Affairs rapporteur: group: PPE-DE name: LAUK Kurt Joachim
  • date: 2007-03-26T00:00:00 docs: url: http://www.europarl.europa.eu/sides/getDoc.do?type=REPORT&mode=XML&reference=A6-2007-76&language=EN type: Committee report tabled for plenary, single reading title: A6-0076/2007 body: EP type: Committee report tabled for plenary, single reading
  • date: 2007-04-25T00:00:00 docs: url: http://www.europarl.europa.eu/sides/getDoc.do?secondRef=TOC&language=EN&reference=20070425&type=CRE type: Debate in Parliament title: Debate in Parliament body: EP type: Debate in Parliament
  • date: 2007-04-26T00:00:00 docs: url: http://www.europarl.europa.eu/oeil/popups/sda.do?id=13440&l=en type: Results of vote in Parliament title: Results of vote in Parliament url: http://www.europarl.europa.eu/sides/getDoc.do?type=TA&language=EN&reference=P6-TA-2007-168 type: Decision by Parliament, 1st reading/single reading title: T6-0168/2007 body: EP type: Results of vote in Parliament
  • date: 2007-06-05T00:00:00 body: CSL type: Council Meeting council: Economic and Financial Affairs ECOFIN meeting_id: 2804
  • body: CSL meeting_id: 2813 docs: url: http://register.consilium.europa.eu/content/out?lang=EN&typ=SET&i=SMPL&ROWSPP=25&RESULTSET=1&NRROWS=500&DOC_LANCD=EN&ORDERBY=DOC_DATE+DESC&CONTENTS=2813*&MEET_DATE=10/07/2007 type: Debate in Council title: 2813 council: Economic and Financial Affairs ECOFIN date: 2007-07-10T00:00:00 type: Council Meeting
committees
  • body: EP responsible: False committee_full: Budgets committee: BUDG
  • body: EP responsible: True committee: ECON date: 2006-07-04T00:00:00 committee_full: Economic and Monetary Affairs rapporteur: group: PPE-DE name: LAUK Kurt Joachim
links
other
  • body: CSL type: Council Meeting council: Former Council configuration
  • body: EC dg: url: http://ec.europa.eu/dgs/economy_finance/index_en.htm title: Economic and Financial Affairs commissioner: ALMUNIA Joaquín
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ECON/6/42503
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2007/2004(INI)
title
Public Finances in EMU 2006
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Rules of Procedure of the European Parliament EP 052
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Procedure completed
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Annual report
type
INI - Own-initiative procedure
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