a) Mr Commissioner,
On the one hand, we state that Europe needs to reverse the decline of investment that has happened in recent years and needs to bolster both public and private investment.
Meanwhile, the two pack and six pack arrangements focus on the need to curtail budget deficits and eventually reach a balance between revenues and outgo.
This is happening in a situation where public accounts are in reality kept on a cash and not an accruals basis.
Naturally, public administrators have found it politically easier to manage their balances by cutting on investment from year to year, rather than on cutting recurrent expenditure.
So, the two pack/sixpack system is actually serving to counter the policy priority of boosting investment.
What should be done about this?

b) My second question relates to having the country specific recommendations and having guidelines drawn up by the Commission when responding to the draft budgets presented by the national governments.
We know the technical criteria on which the Commission must draw on its conclusions.
Still, when making forward assessments, there is still a reliance on subjective factors.
The question remains: Do the positions adopted by the European Commission reflect the good of the Eurozone as a whole, or they reflect that of the country involved?
One could claim that in the long run, both aims coincide but again in the long run, we are all dead.
Where exactly does the balance lie between the national interest as assessed by the government of the state concerned, and the interest of the Eurozone as a whole, as drawn by the Commission? This is a question which relates of course to the controversy we are having now on what’s going on with respect to Italy and France but it is a wider question as well.

Answer of Commissioner Pierre Moscovici

I frankly see no contradiction between the implementation of the rules and the investment plan. As Madame Peres said a few minutes ago, we tried with Mr Dombrovskis and Mrs Thyssen to present you the annual growth survey as a global approach of three components. The first one being fiscal consolidation, which has to be reviewed, the second being structural reforms which have to be led and the third one being the newest, which is the investment plan. I think they complete each other. It is absolutely necessary to go on with this consolidation and I will repeat here that having more deficits or more debt is not a strength for the economy and if you had more deficits or more debts nobody could say that this could be used, if you look at the components of public expenditures to invest more. And this is why the investment plan has been conceived as you know with the constitution of a fund which is based on guarantees from the European budget and from some implementation of the capital of the EIB, plus eventually additional contributions by member states which will not enter into the calculation of the public deficit or public debt of those countries. So this is a global view, this is a global approach and I think it is a better one because precisely it is more coherent and because it treats all the aspect of the solution that we must try to define to get out of the crisis made by this combination of low inflation, low growth and high unemployment, which is absolutely unacceptable for our citizens in Europe. For your second question, I repeat that through as well opinions on draft budget and through the Macroeconomic Imbalances Procedure we have analysed the relative situation of the debtors and creditors and we know that some efforts in different kind have to be made by both and that we need to have more coordination of economic policies and that we need also in some countries to see how the fiscal capacity can be developed to create investment there, meaning as well private and public investment.

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