The European economic governance framework must be reformed to facilitate investment in the climate and social transition, says the Greens/EFA group in the European Parliament in a position adopted on Monday 17 October by Spanish MEP Ernest Urtasun and members of the group in the Committee on Economic and Monetary Affairs.
From a green perspective, moving away from a carbon-intensive, productivist growth model requires that investments considered sustainable receive favourable treatment under EU fiscal rules.
The environmentalists are not advocating the outright exclusion of these investments from the Stability and Growth Pact, which is currently frozen until the end of 2023. They suggest the creation of a ‘green golden rule’ that would allow ‘green’ and social investments to be amortised by spreading the cost of these investments over their entire life cycle, rather than accounting for the entire expenditure in the year it is made.
On the issue of debt reduction, the group rejects the application of the 1/20th rule to all Member States, which could lead to unrealistic consolidation paths for some highly indebted countries. It is therefore in favour of differentiating these trajectories on the basis of factors such as the relationship between interest rates and the level of growth, initial debt levels and the composition of public debt (e.g. the share held by European institutional creditors).
Building on the experience of the NextGenerationEU Recovery Plan, the Greens/EFA group believes that Member States should come up with European level investment and reform plans. In order to improve the ownership of future European rules at national level, the multi-annual budgetary cycle taken into account would be that of an electoral mandate of a national government.
The vision reflected in our group’s position must allow “the much needed investments in the ecological transition”, said French MEPs Karima Delli and Claude Gruffat in a statement. They hoped “very much” that the Commission would take this message into account in the proposals it is expected to present by the end of October.
See the position of the Greens/EFA group: https://aeur.eu/f/3nj (Original version in French by Mathieu Bion)