Debate: Revision of the Stability and Growth Pact
Date: TUESDAY, 9 MAY 2023
Speaker: Maroš Šefčovič
Language: EN

As you know, it is been a long and winding road to table these proposals. First, we launched the review of our economic governance more than three years ago, just before the pandemic swept across Europe, and our response to that immense shock centred on the SURE mechanism and NextGenerationEU. You know that both have been very ambitious, just as these proposals are, and we succeeded with approving and using the mechanisms we created because we found unity in our approach. Therefore, let’s look also at this proposal as a starter of a new chapter in this story, one in which the finding unity will be equally important. I think that the level of the discussion and debate we had this morning is just clearly demonstrating how important the revision of the Stability and Growth Pact is for the future of the European Union, for the well-being of our citizens, and, of course, for the competitiveness of our economy. Mr Ferber highlighted the importance of a responsible approach to the EU budget, to national budgets, but also to have good, informed discussions about the budgets of all EU Member States. Mr Van Overtveldt called for more credibility of the whole process, and we believe that new rules will be more enforceable and that the key aspect here is the fact that there will be much stronger ownership by the Member States of their adjustment plans, because that is one of the cornerstones of our proposals. Member States will evaluate medium—term fiscal structural plans and they would report annually on the progress. I think if you look at it from this perspective, the fiscal adjustment path plans will not only have a strong ownership, but I believe it will have also strong respect from the national authorities because they know they are not only presenting the plans, but putting also the national reputation at the stake. Therefore, we believe that the rules would be more enforceable. I really would like to thank Mr Pedro Marques, Ms Poptcheva, Mr Mureșan and others for their remarks and support not only for clarity, but also flexibility of the proposed rules. I know that their call for central fiscal capacity was repeated in several interventions. In economic terms, we in the European Commission believe that the central fiscal capacity would be an important rule to cope with large economic shocks or large common investment needs, especially in the euro area where there is a single monetary policy and national budgetary responsibilities. However, there is currently no consensus on this issue among the Member States. Furthermore, as I was just referring a minute ago, we have already put together sizeable fiscal funds in order to have sustained and sustainable recovery from the pandemic through the Recovery and Resilience Facility. As you know, these funds are available until 2026. On top of it, we put massive investment into the green policies you have been discussing in this chamber. Our new approach to state aid to not only tackle the aftershocks of COVID—19, but also to help our households, our companies, our Member States, with unprecedented challenges linked with the energy crisis of the last year. And to some of the honourable Members, I just would like to also remind our proposals on taxing excessive revenues of the energy companies and making it available for supportive measures of the citizens of Europe and struggling SMEs. If you allow me, Mr Niedermayer was asking why we are coming with these proposals so late, and you would recall that the debate on these rules is highly complex. I want to underline how much we benefited from the exchange with the European Parliament and with the Member States and other stakeholders. We believe that the time we needed to finalise these proposals was important to build as much consensus as possible with the help and support of also your intervention. We hope that we can achieve this very important goal and we can achieve it before the end of the year. Ms Yon—Courtin, Mr Mureșan and Mr Lamberts have been calling for more investments into the green and digital transition, indeed, also important points of increased defence capabilities of the European Union in these very difficult geopolitical times, the need to address the social vulnerabilities in our Member States. What I think is important that in the old fiscal framework, the required of fiscal adjustment was only based on debt levels and cyclical conditions. So also to respond to Ms Penkova, by contrast, the proposed framework incentivises the implementation of reforms and investment, including those needed to achieve climate and fiscal goals, by allowing, in this case, an extended and more gradual fiscal adjustment path from four to seven years in Member States with debt challenges. So the social dimension comes also in at European Semester and the country specific recommendations will be included in the mid—term plans and can be finalised. So to conclude, Mr President, honourable Members, I think that we would all agree that Europe needs an economic governance framework that can deliver on its promise of stability and growth, one that makes us a better place to face the challenges of today and tomorrow. We believe that the Commission has put forward a balanced set of proposals, but of course, this is just the beginning of the dialogue that will continue over the coming months. Today was the first page in that new chapter and we are, of course, counting on the European Parliament’s support to write the rest of the story together.