monetary policy to actively engage in redistribution policy? well, monetary policy has a very clear goal : price stability. so, i would argue that monetary policy should focus on this goal and leave other goals to other policy areas, and that includes redistribution policy. imagine inflation were sky - high, for a change. should monetary policy then refrain from raising interest rates because it might alter the distribution of income and wealth? again, there is a clear conflict of interest as one tool would have to achieve two objectives at once. that said, the topic of wealth and income distribution is an important one and it should not be taken lightly. i therefore welcome the fact that academia is paying increasing attention to the matter. the ecb is contributing to the debate with our household finance and consumption survey. and this links to a broader issue. in the crisis, monetary policy has played a key role. however, it is not the only game in town – it cannot be the only game, and it should not be. monetary policy is not a substitute for other policy areas such as social policy, fiscal policy or labour policy. as i and many others have repeatedly said, monetary policy cannot resolve the structural problems of the euro area. all it can do is buy time – at an increasing price. so it is time for politics to kick into gear, overcome reform fatigue and do what needs to be done. the current conditions are very favourable. the good news is that many countries have come a long way. ireland was the first success story, and i am glad to be able to add countries such as spain and portugal to the list. these and other examples show that structural reforms pay off and pave the way for growth to return. but coming back to inequality, there is one thing we must do. we must ensure that economic growth benefits everyone. to that end, we should not just rely on redistribution policy. it is rather 7 / 9 bis central bankers'speeches about creating equal opportunities for everyone. in this context, education and equal access to it should be at the top of the to - do list of any government. so, a lot remains to be done, not just on equality but on growth in general. after all, growth also plays a big role in fighting inequality. and when it comes to long - term growth, research shows that the quality of institutions plays a major role. 8 at the same time, the quality of institutions differs between countries. so, some countries have scope to improve judicial systems,

more limited action would not enable the objective to be achieved as effectively and rapidly. third, proportionality stricto sensu implies that the expected benefits of the ecb ’ s actions must outweigh their costs. these principles provide for a hierarchy of tools, where unconventional measures should be used only once conventional measures have been exhausted. let me address, then, the criticism that the distributional consequences of unconventional monetary policy undermine central bank independence. it is worth recalling that monetary policy always has distributional effects. cutting short - term interest rates tends to reduce the income of savers and boost the income of debtors and the wealth of asset holders. it also affects incomes through the macroeconomic effects on employment and wages. in short, not only does conventional monetary policy have distributional effects, it partly works through causing them. in normal times, these effects are viewed as being of secondary importance to the aggregate welfare benefits of price stability. in other words, they are proportionate. moreover, any distributional consequences of monetary policy action need to be set against the distributional consequences of inaction. sudden, unexpected deflation has distributional 2 / 5 bis central bankers'speeches consequences. ten million more people are now employed in the euro area than when unemployment peaked – this number would be much smaller had the ecb not acted, even though we only have a narrow mandate to maintain price stability that does not cover employment. the ecb also attempted to minimise unwanted side effects by carefully designing our tools. for example, it became clear that our asset purchase programme ( app ) was contributing to challenging conditions in the repo market. 8 by the end of 2016, around half of german government bonds were trading “ special ” – that is, at a premium to general collateral. we modified our securities lending programme, including by accepting cash as collateral, to mitigate the impact of the app on repo markets. today, the share of specials is generally below 10 %. in general, prevention is better than cure. that ’ s why we established many safeguards and restrictions, particularly in our public sector purchase programme, to avoid interfering with fiscal and economic policy and providing monetary financing to governments. the stringent eligibility criteria and issue and issuer limits are examples of self - imposed restrictions which have been vetted by the european court of justice. 9 independence and the prohibition of monetary financing prevent central banks from behaving as a fiscal substitute. we have also increased transparency and enhanced accountability measures – the necessary counterparts