The Presidency is hopeful that the compromise version of the package of six legislative proposals aimed at strengthening economic governance will be acceptable to the European Parliament (EP), Minister of National Economy, György Matolcsy said in the press conference, following the 20 June 2011 meeting of the Economic and Financial Affairs Council, acknowledging the cooperation of EP and the Commission.
We are very close to the final agreement, said Matolcsy, referring to the package of six legislative proposals. He recalled that one of the main priorities of the Hungarian Presidency agenda was to strengthen the coordination of economic policy in the European Union, and to promote the acceptance of the relevant five regulations and one directive. "We did it. We have managed to work out an acceptable compromise proposal,” he concluded. He expressed his hope that the Parliament would also endorse the compromise. So, “We can send the right signal to the international money market, and verify the old adage that we stand united.” He acknowledged both the Commission and the EP, for their cooperation with the Council in a spirit, which is open to compromise.
The Council's seven concessions
Responding to a journalist's question, Mr. Matolcsy presented in detail the concessions the Council made to the EP on seven points compared to its first negotiating position, which were developed in March. The Presidency proposal 1) involves the EP in the European Semester through the whole economic cycle; 2) institutionalises the economic dialogue among European Institutions, including the EP and the Council and individual Member States; 3) involves the EP in the establishment and functioning of the macro-economic scoreboard, a kind of early warning system for macro-economic imbalances; 4) enhances the independence of statistical authorities and introduces a fine for Member States who falsify their fiscal statistics; 5) expands the application of reverse qualified majority voting, reinforces the already existing comply or explain procedure by making it public; 6) introduces additional sanctions for Member States in the Excessive Imbalance Procedure; 7) invites the Commission to regularly review the effective function of the regulation and the progress in ensuring closer coordination of economic policies, and to report on the issue of Euro-securities.
Rejection of reverse majority voting
The Minister said the Council will continue to disagree with the expansion of reverse majority voting on the prevention part of the Stability and Growth Pact, which the Parliament would like to see; on that issue, the position of the Council has not changed since March. Nevertheless, he said in his opinion, he was optimistic, that the Council has made so many concessions on other areas that the EP will ultimately endorse the package, which was submitted by the Presidency.
Rehn cautions EP on irresponsibility
European Commissioner for Economic and Monetary Policy, Olli Rehn expressed his opinion, first in the meeting of the Council then in the press conference, that the agreement is 99.9 percent accepted. He called on the Parliament to act responsibly, because we are at a critical moment and the package is too important to fail, Rehn encouraged the Council and the EP to “cover the last centimetre.”
He pointed out that serious consequences may follow if the EP votes against the package on 23 June, or even in the case of a delay in the adoption. The reason is because these legislations would provide the EU with the tools to strengthen economic governance, improve budgetary discipline and prevent the development of macro-economic imbalances; all that is assisted by an efficient coercive mechanism.
Barnier praises Presidency for proactivity
Commissioner Rehn has acknowledged the work of the Internal Markets and Services Presidency team. Commissioner Michel Barnier did the same in the press conference, and praised the Presidency for its proactive approach in the field of the revised regulation of financial services. As he noted, the Hungarian Presidency has contributed with its activity to the establishment of the three pillars of trust: governance, regulation and growth.
The road to compromise
The Council has accepted a general approach on the six legislative proposals on 15 March. After the competent EP committee approved the rapporteurs' reports, a three-party inter-institutional discussion, a “trialogue” began among the Council, EP and Commission on 20 April, in order to ensure the creation of such texts by the end of June, that both co-legislators are ready to adopt as early as in the first reading. The February meeting of the European Council, the organisation of EU heads of state and government, called on the Council to reach an agreement with the Parliament by the end of June.
Since the end of April, meetings have been held by delegations of the three institutes almost daily, and they have gradually managed to reduce the number of unresolved issues. A total of about two thousand motions of amendment were submitted by the EP, on the reports that were prepared about the legislative proposals, which differed from the preliminary position accepted by Member States on several significant points. In the 17 May ECOFIN meeting, the Presidency has asked for the opinions of Member States on the major debated matters, then with the mandates that were received from the Council, it continued with the negotiations and submitted its compromise proposals to the June 20 meeting of ministers, for final approval.
Matolcsy: EU credibility at stake
In the public debate of the Council meeting, György Matolcsy emphasised that the “compromise achieved in all six texts presents a balanced compromise between the EP and the Council. It is for the EP to act in a responsible manner and to approve the texts,” the minister said. In the light of the recent events still affecting the eurozone, I do not have to stress how important it would be to have an agreement on these six legislative proposals, he added in the Council meeting. According to the Minister, the credibility of the EU depends on the timely delivery of the various elements of the comprehensive response, of which the economic governance package is a cornerstone.
Country-specific recommendations also adopted
The Ministers for Economic and Financial Affairs adopted the economic part of the country-specific recommendations, which were prepared by the Commission in the framework of the European semester. The Ministers only made, as Mr. Rehn put it,“relatively minor modifications.” In the opinion of the Commissioner, the first integrated assessment of the national reform programmes and stability and convergence programmes of the Member States has been concluded with it. He pointed out that the implementation of the first European Semester has been a great step forward in the field of macroeconomic surveillance; but he termed it important that the guidelines included in the country-specific recommendations be broken down into specific actions. Mr. Matolcsy stressed that with the completion of the European Semester, the other main economic priority of the Presidency has been delivered.
The last ECOFIN meeting during the Hungarian Presidency’s term will take place on 20 June 2011, in Luxembourg.
Location: European Congress Center - Luxemburg
Address: Luxemburg 1499 Luxembourg, Quartier Européen Sud, place de l'Europe 4.
The ECOFIN meeting’s preliminary draft agenda adopted the package of six legislative proposals on economic governance as a key item. The trialogues have resulted in remarkable progress in most of the debated issues, which gives us a good chance to reach a final agreement by the European Council’s meeting on 24 June 2011 and to close a high priority dossier during the Hungarian Presidency’s term. The target deadline of the final agreement is the European Parliament’s plenary session on 23 June 2011, which is planned to be preceded by an ECON voting on 21 June.
The Council meeting’s agenda will also include the issue of the European Semester, which aims to adopt Council recommendations on the basis of member states’ national reform programmes and stability and convergence programmes.
In the field of financial regulation, the ministers’ discussion topics will include the regulation of over-the-counter derivatives, central counterparties and trade repositories (EMIR), as well as the revision of the Directive on Deposit Guarantee Schemes.
Further issues of the ECOFIN meeting will include quality management of European statistics, and a draft decision on the EU’s guarantee to the European Investment Bank (EIB) against losses under credits and guarantees for non-EU projects.