MEPs on Tuesday 22 November in Strasbourg largely welcomed the European Commission’s recent proposals to reform the European economic governance framework (see EUROPE 13060/1).
Several of them questioned European Commissioners Valdis Dombrovskis and Paolo Gentiloni on how to boost investment to support the climate and digital transitions.
Margarida Marques (S&D, Portuguese) wanted to know which European instruments would take over from the NextGenerationEU recovery plan after 2026. And Irene Tinagli (S&D, Italian) asked whether the Commission planned to extend the Stability and Growth Pact’s ‘investment’ clause, introduced in 2015, which allows for privileged treatment of national public co-financing for European projects.
It is necessary to “find the right balance” between boosting investment and reducing public debt, Mr Dombrovskis noted. This is why, he added, the Commission advocates giving Member States more margin to adjust their debt reduction trajectory, provided this is done in a way that promotes reform and investment. And “investments which correspond to EU priorities are covered to the possibility to be given more leeway”, he stressed.
However, the EU institution is not proposing a European fiscal capacity, although, according to Mr Dombrovskis, “this debate will not die down”.
Responding to Rosa D'Amato (Greens/EFA, Italian), who argued for a ‘golden rule’ to exclude certain investments from the calculation of public deficit, Mr Gentiloni said that the proposal on the table - to give a country more time to consolidate its public finances in exchange for investments and reforms - was “a different way of achieving the same objective”.
What incentives will there be for Member States to better comply with future EU fiscal rules? - asked Eva Maria Poptcheva (Renew Europe, Spanish). By simplifying the rules around a single indicator of net primary expenditure and facilitating Member States’ ownership of their debt reduction trajectory, it will be possible to better enforce the regulatory framework, notably through reduced and more credible sanctions, Mr Gentiloni said.
Mr Dombrovskis also argued that it will be possible for the Commission to deal with “cumulative deviation” cases where, year after year, a Member State deviates slightly from the budgetary path set, whereas the current rules would allow it to avoid a sanction. (Original version in French by Mathieu Bion)