Brussels, 07/02/2011 (Agence Europe) - The main political groups at the European Parliament have reacted differently to the outcome of Friday's European Council (see EUROPE 10309) with the right welcoming the Franco-German idea of a “Competitiveness Pact” and the left rejecting it. Both sides of the political spectrum were united in their warnings of the danger of wriggling round the “Community Method”.
In a press release, the chair of the EPP, Joseph Daul (France) points out that the economic crisis had taught a hard lesson - that social legislation and taxation should be more closely aligned and that such convergence must be achieved with awareness of everyone's views and only the Community Method has proved its worth. The chair of the European People's Party, Belgium's Wilfried Martens, said: “Specifically, the EPP fully supports the initiative to reinforce economic coordination in order to improve European Union competitiveness and in this respect I welcome the extraordinary eurozone summit, which will take place in March”.
The leader of the ALDE, Belgium's Guy Verhofstadt, wants stronger economic governance although there is “the danger of constantly reinventing the wheel. However, we strongly object to the method being suggested. A purely intergovernmental system, outside of the Treaty structures will not have the desired effect. Discipline will only be effectively ensured through the application of the Community Method and through the empowerment of the Commission. The sidelining of the European Commission is unacceptable. Member states must accept that real automaticity in the application of the Stability Pact be introduced”. Verhofstadt, the former Belgian prime minister, said the member states would have to accept genuinely automatic implementation of the Stability and Growth Pact, particularly when it comes to sanctions against countries that break the rules. British Liberal MEP Sharon Bowles, who chairs the EP's Economic and Monetary Affairs Committee, echoed these words saying effort should focus on the legislative package on economic governance and ensuring that the Commission is at the heart of the system and fully reports back to the European Parliament. Bowles said this was the only way to avoid political horse trading and back-scratching among member states.
A very different spirit reigns on the left of the political scene, where the chair of the European Socialist Party, Denmark's Poul Nyrup Rasmussen said: “This Competitiveness Pact is an insult to millions of Europeans working hard to get out of this crisis - yet again the burden falls on them. With the Annual Growth Survey as his instruction manual, Barroso has been reduced to a bumbling mechanic for this juggernaut”. He continued. “How are ordinary people to be expected to make yet more sacrifices on retirement, on wages, and on social benefits, when they are yet to see any tough measures taken to control the financial sector, or even have that sector pay a fair share?” Welcoming the opposition to the Competitiveness Pact from defenders of the Community Method, Rasmussen, a former prime minister of Denmark, pointed out that the Socialists had come up with a Progressive Pact for Jobs and Growth that recommends upwards convergence based on solidarity and the creation of eurobonds.
“This pact fails to address the full spectrum of economic imbalances in the eurozone by putting the blame on weaker member states only. It ignores crucial imbalances, such as Germany's low-wage policy and its surplus, which also damage the eurozone. The Greens welcome the proposals to push ahead with a common consolidated tax base however. Tackling tax dumping must play a central role in any governance package”, explained co-chair of the Greens/EFA, Germany's Rebecca Harms, who says the “Competitiveness Pact” would damage European interests. (M.B./transl.fl)