On Thursday 8 July, the European Parliament adopted by a large majority (461 votes in favour, 94 against and 133 abstentions) the report by Margarida Marques (S&D, Portugal) which sets out a political framework for future discussions on the reform of the European economic governance framework and, in particular, the Stability and Growth Pact, taking into account the experience of the Covid-19 pandemic (see EUROPE 12745/9).
Solutions must be sought to ensure “a functional and credible economic governance framework with solid economic foundations”, said the Portuguese Socialist MEP the previous evening during the plenary session debate. For Ms Marques, the deadline for activating the general escape clause of the Pact, which runs until the end of 2022, should be used to reform the current “complex, opaque and inefficient” European fiscal rules.
In particular, MEPs rely on the European Fiscal Board’s recommendations for a differentiated treatment of public debt, which has exploded with the pandemic (see EUROPE 12585/22). They consider that an expenditure rule with a ceiling on nominal public expenditure when a country’s public debt exceeds a certain threshold can provide more transparent fiscal rules within the EU
On behalf of the EPP group, the Czech Luděk Niedermayer stressed the importance of counter-cyclical rules whereby expansionary policies would be possible in times of crisis, while being counterbalanced by budgetary savings in times of growth.
MEPs rejected three amendments from the Greens/EFA group. According to French MEP Karima Delli, they called for the exclusion of “green and social investments” from the calculation of the public deficit and for the inclusion of the European Stability Mechanism, the euro area’s permanent rescue fund, in the EU’s legal order.
See the report: https://bit.ly/3dVYagB (Original version in French by Mathieu Bion)