Local view for "http://purl.org/linkedpolitics/eu/plenary/2000-10-26-Speech-4-095"
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"en.20001026.3.4-095"2
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"Madam President, Mrs Peijs’ report on retail payments in the internal market takes up Parliament’s longstanding complaint about the high cost of cross-border payments within the Union.
It is quite true. The cost is very high and we know exactly why that is. The interconnections between the computer systems of the various banks in the various Member States are poor, hence the need for expensive manual operations to process payments from one national system to another. This is not some fiendish ploy by the bankers, just a technical reality temporarily resisting resolution, but bound to evolve in the right direction in time.
So I think we should put the problem into perspective, especially as cross-border payments represent a very small part of total payments. The documents I have looked at put their share as low as 0.2% to 0.04%. In every case, it is really microscopic. Yet the European Parliament and the Commission genuinely attach vast significance to it. Why is that?
The first answer is that the European institutions tend to prioritise everything that is cross-border, which is not surprising, after all. But nevertheless, this bias towards cross-border issues must not mean the great majority of citizens is penalised for the benefit of a tiny minority. Investment leading to significant reductions in the cost of cross-border payments would not be profitable because it would be amortised over far too few payers. To that extent, the conclusion must be that making that investment under these conditions would mean applying the costs to all bank customers, most of whom have nothing to do with the matter. I do not really think that, in all fairness, that is a desirable outcome. It is highly dubious politically, and we must also stop giving the impression that something that is expensive for technical reasons can suddenly become free because a directive has been passed saying so. I would remind you of the basic maxim everyone learns in the first year of economics: there is no such thing as a free lunch.
Madam President, there is a second reason for the European Parliament’s perseverance. The Peijs report makes the point in recital D of the motion for a resolution, and I quote: ‘the high level of charges for cross-border credit transfers is damaging the confidence of consumers in the euro’. But why should it damage the confidence of consumers in the euro? I have just explained why these two problems are not linked, at least not apparently. The fact is, several years ago, people were led to believe – who knows why, no doubt to get the euro accepted more easily – that this type of cost would completely disappear with the single currency. Here is a little leaflet. Millions of copies of it were distributed in public places in France, not least post offices, and this is what it says in the section on foreign exchange commission: ‘in the euro area the commission on foreign exchange will disappear’. Of course, in the strict sense that is true, but the naïve reader, the non-specialist, thought that all the costs of cross-border payments would disappear, when in fact foreign exchange commissions only represented a small part of those costs, just a small percentage.
So now we are facing the consequences of the hard sell of the euro, and that brings me to a conclusion on this issue of cross-border payments, but also, Madam President, on the euro generally. One can deny reality using words. You can tell people stories, but sooner or later, your fudging and lies will come back to haunt you."@en1
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