Mr President, I would like to start by explaining exactly what we are discussing. We are dealing with the economic guidelines, and in my view, there are three novel aspects to them. Firstly, they are economic guidelines for three years, not just for one year. Secondly, they will be discussed alongside the employment guidelines. Thirdly, we are holding these discussions at a time of recession. We have learnt this morning that the most powerful economy in the European Union has entered into recession. These are therefore no ordinary economic guidelines. Given these circumstances the Committee on Economic and Monetary Affairs and myself in particular, were requested to draft a report promptly to allow the Commission and the Council to study it. We were asked to try and arrive at the broadest possible consensus. We have achieved this. All the groups had to make compromises but we did manage to reach an agreement. I should like to take this opportunity of highlighting the splendid work of the spokespersons for the various groups. Othmar Karas spoke on behalf of my group, Robert Goebbels spoke on behalf of the Group of the and Carles-Alfred Gasòliba i Böhm spoke on behalf of the Group of the European Liberal, Democrat and Reform Party. I would also like to say to the Commission that whenever Parliament has been invited to respond, the response has invariably been helpful. As suggested in the Poem of the Cid, a servant will always respond well to a good master. I urge you to bear this in mind and to involve Parliament in the discussion of these economic guidelines. Amongst other things, this discussion will serve to put pressure on the Member States lagging furthest behind. I shall now outline the key points of my report. Firstly, we want to know whether the current coordination mechanisms are adequate, or whether further measures are needed. We understand that the Treaty states that national policies, supply policies and short-term policies are policies of common interest and should be coordinated. We are now three years behind with the implementation of the Lisbon strategy. Whenever the Commissioner appears before us, he states that the delay is due to lack of application and due diligence on the part of the Member States We wish to do more than simply wring our hands. We would like to suggest appropriate action to remedy these failures concerning implementation. We have two proposals in this regard. We would ask the Commission once and for all to draw up a list detailing the rigidities hindering implementation of the internal market and structural change. This list should also detail priorities, measures required and the calendar for meeting the Lisbon objectives by 2010. Assuming that lack of due diligence on the part of the Member States is the reason for this delay, we call upon the Commission to explain to us what it could do to remedy the situation. Once upon a time there was a Spanish constitution stating that Spaniards should be fair and charitable. Unfortunately this constitution did not contain any provisions detailing how such a transformation was to be achieved. Subsequently, Spain endured three civil wars during the nineteenth century. We call for coordination to guarantee that all economic policies are going in the same direction. That is what coordination is about. Secondly, I would like to stress that I believe wholeheartedly in maintaining balanced budgetary positions. There is no need to change things that are working well just because other things are not. Monetary policy has worked well during this period. This policy is aimed at achieving price stability. It is managed through an independent bank and a Stability Pact that has maintained only a certain degree of discipline in the Member States. I stress that there has only been a certain degree of discipline. Some States have gone significantly astray. I would therefore like to reiterate my conviction that budgetary balance must remain the objective. As the Commission stated, those extravagant countries will have to reduce their structural deficit by half a percent of GDP. Thirdly, convergence programs should be assessed differently, as the Commission itself highlighted. The Commission has to verify that budgets are balanced. It also has to check carefully to ensure Member States do not exceed the 3% limit. In future, the Commission ought to take account of each Member State’s starting point. It ought to take account of each country’s debt and of how it plans to use resources obtained. It ought also to take account of the country’s anticipated future commitments. Take the case of a country which is not in debt, which plans to allocate money to public finances, notably to measures promoting the Lisbon strategy, and which does not have significant commitments for the future. The case of a country where these circumstances do not apply is entirely different. We call upon the Commission to ensure that Member States build up a budgetary reserve when times are good, or, to use a Biblical image, when the cows are fat. Such a reserve could be drawn on in bad times. We stress that countries should also reduce taxes whenever possible. In particular, we advocate a reduction in taxes increasing labour costs, as this would stimulate employment. Countries that cannot afford to reduce taxes should introduce supplementary measures. They should reduce public spending or increase income in other ways. It is impossible to maintain a balanced budget and reduce taxes at the same time. You cannot have your cake and eat it. As regards the policy on wages, we advocate keeping wages in line with the Retail Price Index. We believe actual wages should be in line with productivity. We advocate increasing labour mobility. In addition, we call on the Commission to speed up work on eliminating the fiscal barriers hindering the transfer of employment pensions. We further call on the Commission to establish an appropriate fiscal policy to complement the agreement reached on pensions. We appeal for social dialogue. Allow me to reiterate that we would like to see fiscal incentives for employment. We call for a reduction of the burdens that make employers unwilling to take on staff, especially those on the lowest wages. With regard to policies on investment, we are aware it has frequently been said we are lagging behind the United States because of lack of investment, especially in technology. We are also aware that we are more or less on a par with the United States in terms of public investment. Under investment occurs in the private sector. We therefore call for a benchmarking exercise to pinpoint the various needs, inadequacies and shortcomings of those companies. This is particularly relevant if small and medium-sized companies, with less than nine employees, are to access new technologies. Resources can only be allocated efficiently if the full picture is clear. We just need to know how things stand. We would like the Commission to report on this promptly. After all, to paraphrase a Spanish poet, there is no such thing as a favourable wind for a sailor who has not yet set his course. All we are requesting is a report to identify inadequacies and deficiencies in SMEs. It would then be possible to establish how best to proceed. I would like to end by thanking all the groups and their spokespersons for their efforts. Once again, the Commission can be assured that Parliament is ready, willing and able to help overcome the difficult situation we find ourselves in.

Political group: PPE-DE