Brussels, 29/09/2011 (Agence Europe) - The European Trade Union Confederation says that the new package of economic governance measures known as the six-pack, endorsed by the European Parliament on Wednesday 28 September, runs the risk of generating unemployment and poverty in the member states as a result of its severe budget austerity and lower wages.
The six items of legislation to back the Stability and Growth Pact (a key eurozone policy) are “seriously flawed”, explains the ETUC in a press release published on 28 September, describing it as “governance of austerity and wage repression”.
The ETUC says that the justification for the six-pack illustrates the wrong approach to the crisis because by tackling the symptoms (public debt and budget deficits), the measures will do nothing about the true causes, namely financial deregulation and speculation. This gives rise to concerns on two fronts. Firstly, the solutions currently being suggested will not solve the problems, which are structural, and therefore risk making everything worse and causing more damage to the economic and social fabric of society. Secondly, focusing on member states' budgets will damage economic recovery and could send eurozone economies into deflation
“For the ETUC, this package is flawed. If, during the 2009 recessions, governments had been forced to follow the public finance criteria the economic governance package is now trying to impose, European economies would have been pushed into full-blown depression. Increases in precarious work and downwards pressure on wages contributed to generating the imbalances currently distorting the single currency”, explained Bernadette Ségol, the ETUC secretary general, after the EP's vote.
The ETUC says it stands for a “governance of recovery and fairness”, and to this end recommends: - the introduction of eurobonds and a European Bank for Sovereign Debt to ensure true solidarity in Europe; -a European investment plan to boost the economy; - a crackdown on precarious work contracts; - a tax on financial transactions and uniform corporation tax throughout the EU; - an end to tax havens and tax evasion; - fair taxation systems. (JK/transl.fl)