The other is a challenge of the future. Let me start with the failure of the past. During the last 25 years, we have had slow employment growth and strong growth in our working age population. This has led to a declining employment rate and a high unemployment rate, around 10 per cent, at present about 17 million people. You are all very familiar with this depressing situation and you know what it means for our pension systems.
Unemployment means less revenue and more public expenditure.
The deep downturn at the beginning of the 90s aggravated the situation and led to a severe crisis in public finances and a deficit of more than 6 per cent. This crisis in the public finances was a real threat to social protection systems in general and one that that forced the EU and the Member States to make tough decisions about putting public finances onto a more sustainable path. Today, we know that the convergence process and the growth in our economies are helping to ease the situation. There is lower public borrowing, lower interest rates and more incentive to invest. Perhaps history books of the future will teach us that EMU helped us to secure the European model of social protection.