Brussels, 23/06/2015 (Agence Europe) - Hot off the press, several European Parliament political parties have already reacted to the report unveiled by the 'five presidents' on Monday 22 June and its roadmap for completing economic and monetary union (EMU).
The S&D approves of the political signal sent by the presidents of the European Commission, European Council, ECB and Eurogroup for a boosting of economic and monetary union (see EUROPE 11340), but Portuguese MEP Maria Joao Rodrigues said: “The report neglects the need for a new social pact, stopping the current downgrading of social standards and reinforced by an anti-shock fiscal capacity.” She points out that member states are being asked to commit to a reform agenda restricted to questions related to the labour market, but neglecting innovation, education and energy efficiency as sources of productivity. Pervenche Berès (S&D, France) hoped the European Parliament would be able on Wednesday 24 June to “demand substantial improvements in the prevention of macroeconomic imbalances to foster convergence and much stronger democratic accountability” in the eurozone (see EUROPE 11336).
On behalf of the ALDE group, Belgium's Guy Verhofstadt was pleased that liberal ideas had been included in the report, such as establishing a 'European treasury' and the creation of an economic convergence code whereby upper and lower objectives would be set for certain policies. He recommended that the Commission speed up the publication of draft legislation based on the Community Method, particularly legislation to complete Banking Union through a European deposit guarantee mechanism. The liberals regret the absence, however, of any reference to completion of the Single Market and the creation of a redemption fund to jointly manage debt of above 60% of GDP for each eurozone member state. They fear that the 2017 elections in France and Germany will slow down the announced greater integration process.
The Greens/EFA group criticises the report as “weak” and simply calling for a boosting of the existing system, such as the European Semester budget process or the macroeconomic imbalances procedure. The group's chair, Belgium's Philippe Lamberts, said the five presidents' report is stuck in a worrying denial of reality because monetary union cannot be viable without financial solidarity mechanisms, which require social unity - a common budget nourished by common fiscality - and/or a social union - an embryo of common social security, “both of which require robust democratic legitimacy”. He criticised the narrow outlook of a report based on competitiveness in the narrowest meaning of the term because it aims to achieve it solely by reducing the direct and indirect costs of labour. Likewise for the abandoning of any ambitions towards the pooling of public debt.
Warnings from the trade unions. The European Trade Union Confederation (ETUC) rejects en masse the idea of creating national competitiveness authorities to analyse pay policy in the member states. ETUC secretary general Bernadette Ségol said there was no way that trade unions would agree to a body independent of the social partners giving its opinion on pay negotiations as this would open the door to major conflict. It is the social partners' job to set pay rates, she warned, pointing out that such bodies already exist in Belgium and the Netherlands, formed by employers and trade unions. She said it spoke volumes that eight years after a crisis caused by the financial sector, councils on workers' pay are seen as the solution, yet there is no mention of the pay of company managers, zero hours contracts, social dumping or tax avoidance by multinationals. (Mathieu Bion)