The draft 2023 annual report on the European Central Bank (ECB), presented by Johan Van Overtveldt (ECR, Belgian), will be debated at the plenary session of the European Parliament on Monday 26 February in the presence of ECB President Christine Lagarde. The report will be put to a plenary vote on Tuesday 27 February.
The text naturally refers to the recent inflation phenomenon and stresses that the objective of price stability is far from being achieved. On this matter, the ECB is also invited to better define the notion of “medium term” and to explore the possibility of a more qualitative approach to price stability.
The explanatory statement included in the draft report goes further and states that the 2% norm is rather utopian and that there needs to be a reassessment of the models (notably inflation projections) and the role they play in policy-making.
The ECB is also called upon to provide more information on the monitoring and setting of the neutral interest rate.
In addition, the text returns to the issue of the digital euro project (see EUROPE 13211/11), taking the view that it should respect competition in the digital banking and payments sector and not threaten financial stability. The draft report also states that a potential digital euro should not replace cash and should respect the privacy of citizens and businesses.
It is on the ECB’s secondary mandate that the proponents of the amendments will clash and, in particular, the consideration of environmental and climate challenges in monetary policy and in the macroprudential aspect. Article 127(1) of the Treaty on the Functioning of the EU states that the European System of Central Banks shall, without prejudice to the objective of price stability, support the general economic policies in the Union with a view to contributing to the achievement of the objectives (environment, social, etc.) of the EU.
In an amendment, Sven Simon (EPP, German), on behalf of his group, expressed serious concern about “political bias within the ECB regarding greening policies”.
In contrast, an amendment proposed by Bas Eickhout (Greens/EFA, Dutch) calls for the introduction of “differentiated” rates to provide preferential support for activities aligned with the objectives of the green transition. The introduction of such a mechanism echoes an open letter initiated by Positive Money Europe and supported by a coalition of European civil society organisations and academics (see EUROPE 13318/17).
Link to the draft report: https://aeur.eu/f/azh
Link to the amendments tabled: https://aeur.eu/f/azb (Original version in French by Émilie Vanderhulst)