Brussels, 22/06/2010 (Agence Europe) - “It is of the essence that the surveillance of budgetary policies be strengthened”, argued the president of the European Central Bank (ECB), Jean-Claude Trichet, on Monday 21 June, adding: “The ECB believes that a true quantum leap is needed in the framework for surveillance and adjustment of fiscal policies”. Trichet was speaking at his routine meeting with MEPs on the European Parliament's economic and monetary affairs committee. “At the level of the EU27, and in particular within the euro area, we must have effective instruments to prevent - and where necessary, correct - excessive deficits and debt levels. A more stringent implementation of rules and procedures is essential, among other things by increasing the automaticity and speed of procedural steps. The initiation of sanctions also needs to be quasi-automatic.” He said that the ECB believed that it was necessary to go as far as secondary legislation will allow, aware that it will be neither quick nor easy to change the EU treaties. He said: “The Commission should have greater responsibility by making proposals, which only modified with unanimity in the Council, rather than mere recommendations under the Stability and Growth Pact.” He regretted that the Stability and Growth Pact had not been properly implemented in the past and this was having a negative impact on the current situation. In an interview with German newspaper Welt am Sonntag on 20 June 2010, Trichet argued that France and Germany bore responsibility for the current eurozone crisis because they had engineered relaxation of the Stability and Growth Pact in 2004.
Overall, he said the eurozone's economic situation was far from brilliant but recent data suggested that the economy was continuing to pick up in the first half of 2010. He said the ECB's earlier forecasts of moderate growth in the eurozone economy this year and next were still on track.
Asked about the idea of setting up an indecent budget surveillance body in the EU with the power to scrutinise member states' budgets, Trichet commented that such an agency would have to be part of the European Commission. He said the ECB believed there were bodies within the Commission for certain domains that could become independent. Germany has suggested giving an independent body or the ECB economic scrutiny powers, but Trichet said it was important not to weaken the Commission. He said the ECB had made it clear that it did not intend to reduce the Commission's powers in terms of its warnings, recommendations and proposals but was very keen on the idea of an independent body within the Commission itself. (A.B./transl.fl)