WRITTEN QUESTION P-1318/97 by José Pomés Ruiz (PPE) to the Commission (10 April 1997)

Subject: Eurostat and entry into the third phase of EMU

During the debate following his speech to the European Parliament's Subcommittee on Monetary Affairs on 27 November 1996, the Director-General of Eurostat was requested to ensure that Eurostat's periodical publications included a reference to the TEU convergence criteria and, with regard to the CIT, separated the

statistical weighted average from the simple arithmetical average of the three best-placed countries, should a significant divergence exist.

Although the Director-General agreed to this request, no reference at all is to be found after the line 'E15' in the first issue of the new harmonized CIP to what the subcommittee had requested and the Director-General had undertaken to provide.

Why has Eurostat not taken up the request made by the Subcommittee on Monetary Affairs on 27 November 1996?

Does Eurostat intend to rectify this and publish details of how the convergence criteria are being met for as long as it takes the countries to complete the third phase of EMU?

Does Eurostat intend, each time it publishes, to annex additional information as to the number of criteria met by each country?

Answer given by Mr de Silguy on behalf of the Commission (12 June 1997)

Under the EC Treaty, the Commission has the responsibility to provide relevant statistics for the assessment of the convergence criteria. In the particular case of the inflation criterion, Eurostat has co-ordinated the setting up of the harmonised indices of consumer prices. These are available from January 1997 and allow an assessment of inflation in the Member States on a comparable basis, as required by the Treaty.

In the calculation of the inflation reference value, the Commission used the following operational definitions in its convergence report of 1996 (('Report on convergence in the European Union in 1996' - COM(96) 560 final, published in European Economy, supplement A, No 1 - January 1997. )): 'a Member State's inflation is measured by the percentage change in the arithmetic average of twelve monthly [interim] indices [of consumer prices] relative to the arithmetic average of twelve monthly indices of the previous period'. The reference value has been 'calculated as the arithmetic [non weighted] average of the inflation rates of the three best performing Member States plus 1.5 percentage points'. In the next convergence report, in 1998, the interim indices will be replaced by the harmonised indices of consumer prices. It should be noted that, in its convergence report, the European monetary institute has followed the same operational definitions as the Commission.

The Commission's 1996 convergence report discussed the different issues relevant to these definitions and showed that alternative calculations resulted generally in very similar results. The Commission, in all official documents, has underlined that its assessment of the respecting of the convergence criteria will be conducted in due time, according to the letter and the spirit of the Treaty. This is why it is premature at this point to set in stone a definition of the inflation reference value.

Similarly, the Commission has repeatedly insisted that the EC Treaty stipulates (Article 109j) that other price indices should be taken into account in the assessment of the inflation convergence within the Community. This is why, in its convergence report of 1996, the Commission devoted an entire section to these other indices.

In view of the above considerations, the Commission considers it inappropriate to publish, on a regular basis, information on which Member States would meet the inflation convergence criterion.

Regarding the availability of information on the convergence criteria, a table headed Current performance of the Member States in relation to the convergence criteria is published monthly in the Economic data pocket book. This table includes figures calculated according to the operational definitions currently used by the Commission for the different convergence criteria, but provides, in the light of the above, no reference value.