C 180/4
(8)
EN
Official Journal of the European Union
23.5.2023
In order to respond to the increase in energy prices, euro area Member States have taken emergency measures estimated to represent 1,25 % of GDP in 2022 and up to 1 % in 2023, with the expected decrease contingent on developments in the price of energy and on the planned roll-back of the related measures.
Based on the Commission’s services autumn 2022 economic forecast, the measures taken so far mainly aim at mitigating price increases, and on average only 20 % are targeted income measures.
There is a need to limit the fiscal cost of such support measures, while taking into account their distributional impact across income brackets, the impact on energy demand and investment in the green transition, possible distortions to the single market and negative spillovers across Member States.
To that end, it is important to agree on a common approach.
In particular, a well calibrated two-tier energy pricing model, whereby vulnerable consumers benefit from regulated prices up to a certain level of consumption, and other schemes that achieve similar objectives, taking into account national features, could be explored.
Additionally, there could be reflection as regards appropriate ways to wind down support as energy price pressures diminish.
Besides temporary energy measures, public and private investment can help bolster energy independence and security and the green transition.
Since the global financial crisis, the euro area has been suffering from low levels of both private and public investment.
Policy steps taken in response to the COVID-19 crisis, with the exceptional support of NextGenerationEU, have helped maintain the level of public investment, with a positive impact on potential growth, especially in the Member States with the highest public debt burden.
Further private and public investment, in particular through the implementation of the recovery and resilience plans, of cohesion policy programmes, and of national energy and climate plans to be updated by Member States by June 2023, is critical for sustainable and cohesive growth and to achieve the green and digital transition.
(9)
On 9 November 2022 the Commission published a communication on orientations for a reform of the EU economic governance framework to improve the effectiveness of economic surveillance and policy coordination in the Union.
That communication aims to define a simpler and integrated architecture for macro-fiscal surveillance to ensure debt sustainability and promote sustainable and inclusive growth.
The key elements of that communication aim at simplifying the framework, improving national ownership and strengthening enforcement.
That communication proposes that fiscal trajectories are set out in medium-term fiscal-structural plans proposed by Member States, within a transparent common Union framework.
Those plans, which would be adopted by the Council, would bring together fiscal, reform and investment commitments supporting debt sustainability and sustainable growth and reflecting Union and national priorities.
Reform and investment commitments in the national medium-term fiscal-structural plan would allow for a longer fiscal adjustment period.
While maintaining the Treaty reference values of 3 % of GDP for the deficit and 60 % of GDP for the debt, the framework would rely on a more risk-based surveillance focused on debt sustainability.
As regards the macroeconomic imbalance procedure, it is important to continue to address macroeconomic imbalances in a coordinated and balanced manner.
The Commission communication proposes a more forward-looking framework to be able to identify emerging risks as they develop.
The assessment of whether imbalances exist would remain based on the three criteria of gravity, evolution and the policy response.
However, the criteria of evolution and the policy response by the Member State concerned would be given more weight in the assessment.
(10)
The euro area labour market has shown remarkable resilience thanks to policy support during the COVID-19 crisis.
In the first quarter of 2022, total hours worked surpassed pre-pandemic levels, and employment continued to grow throughout the first half of 2022 to historically high levels in the second quarter of 2022 pushing the unemployment rate to 6,8 %, its lowest level since the creation of the euro.
Still, scope for improvement remains with regard to the labour market integration of women, young and older people, persons with disabilities and vulnerable groups.
Going forward, the expected slowdown in economic activity is set to weigh on employment prospects, with unemployment rate slightly increasing in 2023.
There is little evidence that the COVID-19 crisis led to a structural deterioration in job matching.