A4-0304/98

Resolution on the communication from the Commission on the impact of the changeover to the euro on Community policies, institutions and legislation (COM(97)0560 - C4-0591/97)

The European Parliament,

- having regard to the communication from the Commission, COM(97)0560 - C4-0591/97,

- having regard to its earlier resolutions on the internal impact of the euro on the Community,

- having regard to the Council resolution of 7 July 1997 on the legal framework for the introduction of the euro ((OJ C 236, 2.8.1997, p. 7)),

- having regard to the conclusions of the Luxembourg European Council of December 1997,

- having regard to the report of the Committee on Economic and Monetary Affairs and Industrial Policy and the opinions of the Committee on Agriculture and Rural Development, the Committee on Budgets, the Committee on External Economic Relations, the Committee on Legal Affairs and Citizens' Rights, the Committee on Regional Policy and the Committee on Culture, Youth, Education and the Media (A4-0304/98),

A. whereas the effects of the changeover to the euro on Community policies, institutions and legislation will be very diverse and complex, and whereas the Community itself must clarify in good time what these effects will be,

B. whereas the legal framework for the changeover to the euro is governed by the two basic regulations, Regulation (EC) 1103/97 of 17 June 1997 ((OJ L 162, 19.6.1997, p. 1.)) (on the basis of Article 235 of the EC Treaty) on certain provisions relating to the introduction of the euro, and the forthcoming Council Regulation (on the basis of Article 109l(4) of the EC Treaty) on the introduction of the euro,

C. whereas on 2 May 1998 the decision on the eleven States which are to participate in the launch of the common European currency as of 1 January 1999 was reached unanimously and only Britain, Denmark, Sweden and Greece will not participate from the start,

D. whereas the services of the Commission and of the other Community institutions were involved in the preparatory work; whereas it is essential to look in detail particularly at the practical consequences for Community policy, and whereas other Community bodies must be involved alongside the Commission in order to issue specific legal acts,

E. whereas in some fields it is necessary to examine the compatibility of the euro with Community law, and where necessary to create such compatibility, and whereas some of the work to this end must begin before the third stage,

F. whereas the technical and practical impact of the euro in terms of information technology, administrative adjustments and the information and training of staff must be examined in good time and solutions offered, and a wide-ranging information campaign must be launched as soon as possible in order to inform Community staff of changes to pay and pensions,

G. whereas the Commission's communication is also intended to help the Member States in concluding their own internal preparations,

H. whereas there is a need for adaptation at national level in the Member States in the majority of the policy areas referred to in the communication,

I. whereas the three most important EU areas affected by the introduction of the euro are the Community budget, agricultural policy and administration,

J. whereas, although the Community budget is drawn up in ECU, both revenue and expenditure are wholly or partly paid on the basis of national currencies,

K. whereas the fact that payment transactions have hitherto been in national currencies rather than ECU has meant that the exchange rate risk resulting from fluctuations in national currencies was a charge on the Community budget,

L. whereas, in the past, currency revaluations within the European Union resulted in a considerable drop in the agricultural conversion rate and it was often difficult to find temporary financial support to provide adequate compensation for farmers' loss of income,

M. whereas the expenditure of the Community institutions and bodies totals nearly ECU 3 bn, by far the greatest part of which goes on the salaries and pensions of staff,

N. whereas salaries are calculated and paid in the currency of the country in which the staff member works, with purchasing power equivalence being created by adjustments to the salaries of those staff members who are not working in Brussels or Luxembourg,

O. whereas some 90% of the total of nearly 30 000 EU officials work for the various bodies in Brussels or Luxembourg; whereas a majority of pensioners also live in Belgium or Luxembourg; whereas therefore the participation of these two countries with effect from 1 January 1999 will mean that the euro will have a special impact on the administrative tasks of the Community,

1. Welcomes the Commission communication on the impact of the changeover to the Euro on Community policies, institutions and legislation and the practical steps already proposed with a view to making the concomitant amendments to the Staff Regulations of officials and other servants of the European Communities and the agri-monetary scheme;

2. Welcomes the fact that in preparing this Commission communication a wide-ranging dialogue took place within the Commission and with other Community institutions;

3. Welcomes the fact that with the introduction of the euro the participant Member States will have the same currency as that in which the Community budget will also be drawn up, and that these states will thus no longer be affected by exchange rate fluctuations;

4. Calls for a sensible and practical transitional system for the countries which are not members of the euro zone at the outset (the Pre-Ins) and calls on the Commission to present a modified and simplified system for the Pre-Ins, which will continue to need conversion rates;

5. Welcomes the fact that the agricultural exchange rates, which have necessitated significant compensation payments between the Member States, will in future be superfluous in the countries participating in monetary union;

6. Believes it is essential to ensure that the new agri-monetary regime, and any transitional arrangements needed, do not create new distortions or scope for discrimination between countries participating in the single currency and those not participating or joining later, including the accession countries;

7. Welcomes the practical proposals made by the Commission firstly concerning the agri-monetary scheme after the introduction of the euro and secondly concerning the transitional measures for the introduction of the euro in the common agricultural policy;

8. Regards the Commission's practical proposals concerning the two Regulations on the future of the agri-monetary schemes as a worthwhile and necessary contribution, with a view firstly to minimizing the losses of farmers due to past currency fluctuations when changing over to the euro and secondly to maintaining a modified agri-monetary scheme for the Member States of the European Union which do not join the Economic and Monetary Union on 1 January 1999;

9. Believes that the issue of the elimination of the disparities between the euro rate and the green rate must be carefully considered and may give rise to compensation for farmers;

10. Points out that the risk of serious moves of a currency out of alignment with the euro will still exist and believes that a mechanism like the present freeze of the gap at 11.5% should be envisaged after 1 January 1999;

11. Recommends that maximum flexibility be applied and compensatory mechanisms or mid-term revision of parities implemented in the case of operations where there is still a need for conversion into national currencies in the context of cultural programmes (amounts for subsidies, thresholds, etc.);

12. Congratulates the Commission for creating the preconditions to enable salaries and pensions to be paid in euro not just from the end of the transitional period on 31 December 2001 but as from 1 January 1999 and calls on the Council to adopt the necessary amendments to the Staff Regulations after participation by staff representatives and by the European Parliament;

13. Is convinced, in view of the political importance and symbolic value of Community staff salaries, and with a view to the preparations in the Member States, that it would be advisable for all amounts in the Staff Regulations to be expressed in euros with effect from the third stage of Economic and Monetary Union on 1 January 1999, achieving this immediate changeover to the euro by means of a provision expressed in general terms;

14. Calls on the Commission to launch its planned large-scale, well prepared information campaign for Community staff as soon as possible, and in any case before the end of 1998, in agreement with the unions;

15. Welcomes the Commission's guidelines on the legal changeover of monetary references;

16. Welcomes the fact that the general effect of introducing the euro on the Community budget will be beneficial to both the revenue and the expenditure sides, and that the conversion rate risk borne by the Community budget will be considerably reduced and currency management significantly simplified;

17. Regards it as a major benefit that, in treasury and financial management, the use of the currencies of the net contributor states to purchase ECU on the open market will largely cease;

18. Welcomes the Commission's intention of exploiting the currency and accounts management benefits of the introduction of the euro in the interests of the European Union's accounts management in the period before 1 January 2002, and calls on it to make preparations for the use of the euro from 1 January 1999;

19. Underscores the need for a tracking and early warning mechanism to coordinate and dovetail the legislative and budgetary timetables, so as to permit the budgetary impact of the changeover to the euro to be controlled and ultimately quantified, which would also enable the headings concerned to be endowed, under the budgetary procedure, on the basis of real needs;

20. Believes that the budgetary aspect of this changeover to the euro must involve more than simply an accounting exercise; rather, the budget must also be used as a tool for applying and managing Community policies so as to have some influence over the objectives set by the legislative timetable;

21. Regards it as essential for the Commission to clearly incorporate the 'action and timing' announced in its annual legislative programme so as to identify where timing has been complied with and, if necessary, where there have been any delays, and why, so that the necessary budget-related conclusions can be drawn;

22. Supports the intention of Eurostat to re-scale the time-series for primary statistics and thus to guarantee the continuity of statistical information and series, and calls for priority to be given to a common conversion policy for the whole European statistical system;

23. Welcomes the fact that the Commission has set up a specific working group 'Euro/year 2000' in order to support the efforts of the different services in preparing their systems for both these events, and assumes that this working group's conclusions will be published as soon as possible;

24. Welcomes the fact that concerning payments from the Structural Funds the exchange risk borne by the Member States will be substantially reduced for the countries participating in the euro area; insists that the 'pre-in¨ countries should not be penalized for not participating in the euro area;

25. States that the changeover to the euro will have a considerable impact on statistics and informatics of both the Commission and the Member States; draws attention to the fact that most of the Structural Funds budgetary reports are still sent to the Commission on paper; believes that the situation should be taken as an opportunity to create a European cooperation network for administration in the field of informatics and statistics in order to guarantee coherent systems not only for routine follow-up financial information but also for background information needed in decision-making;

26. Supports the Commission's intention to simplify considerably certain areas of policy, and to tackle in particular the complex and expensive agri-monetary system as a prime example;

27. Notes that around 4000 Community acts will be affected by the changeover to the euro and considers that, for the purposes described above, the Commission should publish a communication in the Official Journal of the European Communities with an annex detailing the monetary references in the provisions which will be affected;

28. Notes also that in some sectors existing legislation may require amendment and, with this in view, observes that most monetary clauses involve legislative provisions contained in acts adopted or to be adopted under the codecision or cooperation procedure and therefore points out that such amendments should be adopted under the same legal basis and same procedures as the basic legislation;

29. In this connection, calls on the Commission to adopt these measures at the earliest possible stage and, where appropriate, to introduce new provisions designed to ensure that the application of the principle of legal continuity governing the legal framework for the euro does not create serious distortion or prevent the alignment of monetary amounts between the participating Member States at the end of the transitional period and also to ensure the cohesion of the general system described in its communication for the 'pre-ins';

30. Considers that most of the work of adapting legislation will fall to the Member States and that this work should be completed in the context of the general revision of national legislation; considers, however, that this should take place as soon as possible and not wait until the end of the transitional period;

31. Stresses that the Community's conversion effort will principally be concentrated on the period leading up to the beginning of the third stage of Economic and Monetary Union on 1 January 1999, while the conversion effort at national, regional and local level will require the whole period up to 2002;

32. Advocates a maximum of flexibility for transactions which still require currency conversions under the structural funds and a wide range of programmes (subsidies, threshold values, etc.) and calls for the use of compensation mechanisms;

33. Recommends that an appropriate information policy be introduced for those present or future participants in European programmes who still have to contend with exchange rate risks;

34. Stresses that the regional authorities and the beneficiaries of the Community structural funds should be well informed on the impact of the changeover to the euro; urges the Commission to do its utmost in the information campaigns;

35. Considers it necessary that, as from 1 January 1999, the commercial interest reference rates (CIRR) of the participating Member States and the CIRR for the ecu should be replaced by a single euro-CIRR, and stresses that such a change could eliminate distortions of competition which have hitherto been a feature of the various national policies in the field of State-supported export credits;

36. Points out that the relationship between the euro and the currencies of the Central and Eastern European countries applying for accession - some of which are already closely linked to the German mark - will have to be very carefully analysed so as to prevent distortions of competition in the pan-European market as well as ensuring that convergence requirements do not slow down the current process of intensive economic growth and structural change under way in most of these countries;

37. Considers it vital for the EU to introduce an information strategy specially geared to the countries with the closest ties with the Union (applicants for accession, Mediterranean associated countries, countries covered by the Lomé Convention and main trading partners) and for the most important international financial centres;

38. Welcomes the fact that the Commission, in its overview of the impact of the changeover to the euro on Community legislation (Annex 8 of its communication), has set out its views on the need for adjustment and the timetable to be followed;

39. Calls on the Commission to submit as soon as possible, and in any case before the end of 1998, a further interim report on progress in implementing the Commission's proposals;

40. Calls on the Member States to press on with the conversion of public administration from national currencies to the euro, and from 1 January 1999 to permit citizens to make payments, particularly tax payments, in euros;

41. Instructs its President to forward this resolution to the Commission and Council.