Brussels, 12/06/2012 (Agence Europe) - Olli Rehn, the commissioner in charge of the euro, urged MEPs, on Tuesday 12 June, the eve of the plenary session vote on the two legislative texts (see EUROPE 10630), to move quickly so that the two regulations (the “two pack”) complementing the revised stability and growth pact are in place before the fiscal compact comes into force. If the European Stability Mechanism (ESM) comes into effect before the “two pack”, a legal “grey area” will result and some serious legal difficulties will have to be faced, he said. A situation like that would be very bad for the credibility of the Community method, he added, while acknowledging that the democratic process in the European Parliament (EP) was longer than in the Council of the EU.
The two regulations seek to bring increased budgetary and macroeconomic supervision of the countries of the eurozone, especially those subject to adjustment programmes, into European legislation. They set a date - mid-October - by which countries must submit their draft budgets for the following year. The legislative package incorporates provisions of the fiscal compact into EU law. Rehn, indeed, described it as the first step in transferring the budget treaty into Community law.
Danish Economy Minister Margrethe Vestager argued that ensuring healthy public finances and promoting growth were “two sides of the same coin”. Jean-Paul Gauzès (EPP, France), one of the EP rapporteurs, said that “preventive action taken at an early stage is better than corrective measures coming late in the day, maybe even too late”. He said the text went further than the initial proposal since it strengthens the power of the Commission in recommending that corrective measures be put in place or in demanding new debt reduction plans. He drew attention to the large majority that backed his proposal that a protection provision be introduced for countries in difficulty. Speaking on behalf of the S&D Group, Hannes Swoboda (Austria) argued that, along with the discipline, there has to be targeted investment. The Social Democrats have put down only one amendment ahead of the plenary session vote. This amendment calls on the Commission to identify investment outlay within the framework of its supervision of states' budgetary situation. Sylvie Goulard (ALDE, France) said that the most important alteration brought by the EP is the creation of a debt redemption fund which will pool the excessive debt of all the countries of the eurozone. One cannot just say discipline right now and all the rest (such as pooling of debts, budgetary convergence and targeted investment) will follow on later, said Philippe Lamberts (Greens/EFA, Belgium). (MB/transl.rt)