WRITTEN QUESTION E-1892/01 by Antonios Trakatellis (PPE-DE) and Ioannis Marínos (PPE-DE) to the Commission. Economic values and creative accounting in Greece.
Date: 2001-06-28
Institutions: European Parliament, Provisional data
Subjects: Greece, budget deficit, loss, national accounts, public administration, public debt

4.4.2002

EN

Official Journal of the European Communities

C 81 E/69

A draft Council Resolution on law enforcement operational needs with respect

to public
2.
telecommunication networks and services has been discussed in the preparatory levels within the Council
but it was not adopted by the Council.

(1) OJ C 329, 4.11.1996, p. 1.

(2002/C 81 E/081)

WRITTEN QUESTION E-1888/01

by Ioannis Mar(cid:237)nos (PPE-DE) to the Council

(27 June 2001)

Subject: Accession of new countries to the Union

According to Facts about Turkey, a sleek publication produced by the Turkish News Agency and
distributed for some time to all MEPs, 97 % of Turkish territory is in Asia and 3 % in Europe (Eastern
Thrace). Russia is in a similar situation, albeit that its European part accounts for much more than 3 % of
its territory and stretches as far as the Urals. Since December 1999, Turkey has been a (cid:145)candidate State(cid:146) for
accession, despite the fact that a very small part of its territory is in Europe. Russia, a country with a vast
market and inexhaustible natural resources, has not yet acquired that status as it has not submitted an
application for membership.

Would a possible Russian application for accession in the distant future mean that the Union would extend
its geographical frontiers to the shores of the Far East and border on countries such as China and Japan?
Would it be possible (provided the Copenhagen criteria are met) to consider a (cid:145)pilot(cid:146) accession to the
Union for regions such as European Russia or Eastern Thrace (European Turkey), which clearly are in
Europe and have a significantly higher level of economic development than the other regions of the
countries to which they belong?

To what extent does the Council consider it appropriate to draw up a study on such a possible
development, which might result in the incorporation of some areas of those countries into the structure
of Europe, and the avoidance of an adverse situation in which the EU would shoulder the burden of the
economic convergence of underdeveloped, remote areas which,
furthermore, belong to geographical
regions which are not in Europe?

Reply

(26 November 2001)

According to Article 49 of the Treaty on European Union, any European State which respects the
principles of liberty, democracy, respect for human rights and fundamental freedoms, and the rule of law
may apply to become a member of the Union. The Council shall decide unanimously on any such
applications for membership on the basis of Article 49, paragraph 1 TEU, after consulting the Commission
and after receiving the assent of the European Parliament.

The conditions of admission and the adjustments to the Treaties on which the Union is founded shall be
the subject of an agreement between the Member States and the applicant State and submitted for
ratification by all the contacting States in accordance with their respective constitutional requirements.

(2002/C 81 E/082)

WRITTEN QUESTION E-1892/01

by Antonios Trakatellis (PPE-DE) and Ioannis Mar(cid:237)nos (PPE-DE) to the Commission

Subject: Economic values and (cid:145)creative accounting(cid:146) in Greece

(28 June 2001)

It has been said and written innumerable times that some Member States have resorted to (cid:145)creative
accounting(cid:146) and that the manner in which it is used runs counter to the objective of containing fiscal
deficits, which is a basic component of the stability and development programmes.

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4.4.2002

What are the Commission(cid:146)s findings in this respect, and what practical steps is it taking to curb this
phenomenon? In particular, does it consider, in common with the Council(cid:146)s official opinion that (cid:145)the Greek
Government(cid:146)s stability programme for 2000-2004 is ambitious in terms of development and employment(cid:146)
and that (cid:145)future challenges call for a more determined approach to reform(cid:146) that progress in this area will be
further hindered if it is in fact confirmed, that by virtue of (cid:145)creative accounting(cid:146), the Greek public debt
appears to be five or six times lower than it actually is, as figures disclosed to the Greek Parliament reveal?
It has been said, for example, that although the official fiscal deficit in the national budget for 2000 is
calculated as 0,9 % of GDP, the final report by the Governor of the Bank of Greece puts the Greek
Government(cid:146)s borrowing requirement for 2001 at 4 % of GDP. To what extent is the Commission aware of
this important issue? Has it taken steps to check the credibility of these allegations and to what extent does
it consider the government(cid:146)s reassurances to be sufficient? What specific, verified information does the
Commission have on this matter? If in fact there is an attempt to cover up the real extent of the public
debt, the consequences for future economic stability in Greece would be devastating since, apart from the
disruptive effect it might have on the EU(cid:146)s stability, future generations would have to pay an extremely
high price because of the practice of transferring debt to future financial years by means of issuing
securities and bonds in anticipation of future revenue. What is the Commission(cid:146)s view of the Greek
Government(cid:146)s advance borrowing from the banks against future revenue from the third Community
Support Framework (cid:129) obviously for high rates of interest and commission (cid:129) which will become a liability
in future financial years? Does anything similar occur in other countries involved in the Cohesion Fund?

Answer given by Mr Solbes Mira on behalf of the Commission

(18 September 2001)

The assessment of the budgetary situation of Member States is made on the basis of information provided
to the Commission, on a regular basis, according to the EC Treaty, that is, in the context of the excessive
deficit procedure (twice a year) and in order to satisfy the requirements of the Stability and Growth Pact
(Convergence and Stability Programmes, once a year). Budgetary data refer to the (cid:145)general government(cid:146)
which includes: the state budget and the central government, the local government and the social security
sector; data are elaborated by the Member States on the basis of the rules laid down by Council Regulation
of ESA 95 (European System of National Accounts (1)). The conformity of the submitted data with
Regulations is validated regularly by the Commission (Eurostat).

Greece submitted the first stability programme under the requirements of the Stability and Growth Pact in
December 2000. At that time, the deficit of the general government for 2000 was estimated at 0,8 % of
gross domestic product (GDP). Following an assessment by the Commission, and with respect to the
Commission Recommendation, the Council
issued an opinion on the Greek stability programme on
12 February 2001. In the March 2001 notification under the excessive deficit procedure, the deficit of the
general government was marginally higher, at 0,9 % of GDP for 2000. For the sake of transparency, the
(public accounts) and the
notification explains in detail
government deficit (national accounts); according to this, the State budget deficit in 2000 was 4,0 % of
GDP (public accounts), while the deficit of the central government was 3,3 % of GDP (in national accounts,
ESA 95) and the surplus of the social security sector reached 2,4 % of GDP. Indeed, the social security
sector accounts in Greece in recent years
surpluses which are contributing in
compensating partly the deficit of the central government and the State Budget. This situation is partly
explained by the fact that, while a small number of main pension funds face large deficits and are
extensively subsidised by the State Budget, a big number of supplementary funds are receiving
contributions and pay no pensions as they have not yet attained maturity. To some extent, the surpluses
of the social security funds are the result of the reforms undertaken in the 1990s.

the transition between the budget deficit

show significant

With respect to the stock of government debt in Greece, the data notified in March 2001 showed that the
debt ratio declined by only 0,7 percentage points to 103,9 % of GDP in 2000 while the 1999 Convergence
Programme projected a much stronger reduction; this development was partly due to valuation effects on
Greece(cid:146)s external debt from the strong decline in the drachma effective exchange rate in 2000. Although
the debt ratio in Greece is on a downward trend since 1996, it is still very high and exceeds significantly
the reference value of 60 % of GDP set in the EC Treaty. For this reason, and in view of preparing for
future challenges, notably the budgetary burden from ageing population, the Commission and the Council
have recommended to the Greek government to implement a fiscal consolidation strategy centred on high

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primary surpluses which is essential in reducing rapidly the still very high government debt ratio. Such a
strategy is indeed underlying the budgetary projections of the first Greek stability programme. The Greek
government will present an update of the stability programme before the end of 2001.

Finally, with respect to debt management operations and debt financing, the Commission is not involved
in the choices made by governments as regards the financial
the
Commission is monitoring on a regular basis, in the framework of the above mentioned procedures, the
correct treatment of each operation in terms of national accounting and ensures that a sufficient degree of
transparency is associated with Member States(cid:146) reporting. In cases where the treatment of a financial
the
operation is not covered explicitly by the commonly established rules of national accounting,
Commission proceeds to an ad hoc methodological examination of the operation in close collaboration
with all Member States; subsequently, a general recommendation is issued, thereafter followed by all the
Member States. For instance,
this has been the case a few years ago as regards the treatment of
privatisation revenues, of debt assumption and of zero coupon bonds.

instruments used. Nonetheless,

Nevertheless, as far as the Community Support Framework for the 2000-2006 programming period is
concerned, the Commission has written to the Greek authorities, asking for some clarifications about the
practicalities of these schemes.

(1) Council Regulation (EC) No 2223/96 of 25.6.1996 (cid:129) OJ L 310, 30.11.1996.

(2002/C 81 E/083)

WRITTEN QUESTION E-1898/01

by Caroline Jackson (PPE-DE) to the Commission

(28 June 2001)

Subject: Fish meal and fish oil

Given the assurances in the White Paper that European consumers will be provided with essential and
accurate information, as well as the need stressed by Commissioner Byrne for the European Union to re-
establish public confidence in its food supply, science, law and controls,

1. Can the Commission state whether the temporary prohibition on the use of fish meal in ruminant
diets has any basis in evidence that fish meal may contain the prion responsible for TSEs, and that it is
thus capable of causing BSE in ruminants?

2.

If not, what is the basis for the temporary prohibition?

3. Does the Food and Veterinary Office or EU vet services have proof

that

fish meal

is more

contaminated with MMBM than other feed ingredients?

4. Have the Food and Veterinary Office in Dublin and/or the EU Member States(cid:146) veterinary services
determined that there is any proven reason indicating that fish meal is more cross-contaminated with
mammalian meat and bone meal (MMBM) than other feed ingredients?

Answer given by Mr Byrne on behalf of the Commission

(18 September 2001)

1.
Council Decision 200/766/EC of 4 December 2000 concerning certain protection measures with
regard to transmissible spongiform encephalopathies and the feeding of animal protein (1) suspends the use
of fishmeal as an ingredient in feed destined for ruminants. This suspension of fishmeal was taken as a