Local view for "http://purl.org/linkedpolitics/eu/plenary/2001-02-15-Speech-4-245"
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"Madam President, I should like to thank all the speakers for their opinions. I tried to clarify a number of points in my initial speech, but I have a feeling that I did not succeed.
Article 99(4) – which is one of the things you are concerned about – applies in accordance with the provisions of current legislation. There has been discussion about whether the censure of Ireland is or is not justified. In my opinion, it
justified. If it were not, this proposal would not have been made. Moreover, it is justified in spite of the limited impact Ireland has on the overall European economy. Clearly, there are – and I repeat – two reasons why I think the censure is justified: firstly, because of the obligations accepted by everyone in terms of the model we have defined; and, secondly, because I do not believe that anyone can seriously defend the view that, in terms of the model we have implemented, a country can be treated unequally on the grounds that it is large or small.
We can talk about other subjects which have also been raised: the problems concerned with Ireland’s contribution to European growth, specific problems, the development of inflation etc. I think that all these technical subjects can be discussed. It is true that nominal inflation has gone down in the last two months in Ireland. Nonetheless, when we talk about the overheating of the Irish economy, we are talking about underlying inflationary pressures, the operation of underlying inflation, the increase in salaries, the increase in the cost of living and many other factors fundamental to any correct assessment of what is happening in Ireland.
Is our approach wrong? Here, we are embarking upon a subject that is difficult to assess because it is necessary to ratify the Treaty of Nice and because it is a factor that will impact upon other models. I would ask you whether you believe that policy assessments of this kind exempt the Commission from its duty to apply the Treaties in the forms in which they are established. In my opinion, the Commission has acted with sufficient prudence after having repeatedly urged the Irish Government to take a different course. The Commission presented the matter to the Group of Euro Countries and to the Economic and Financial Affairs Council. The decision was not approved by chance. The matter was debated by the special group of the Economic and Financial Committee after each and every one of the arguments put forward by the Irish Government had been analysed. And, in spite of all that, the decision was taken, as I have just said, on the proposal of the Commission and, so to speak, with the assent of the Council of Ministers.
In my opinion, the Commission did what it had to do. I would again emphasise the significance of the term, ‘recommendation’. I am not talking about a sanction but about a recommendation, and I believe that we cannot draw any conclusion which takes us farther away from the content of that Council decision suggested by the Commission, namely to apply a standard which is there in the Treaty for the purpose of resolving a series of practical problems raised in the model we have established for coordinating economic policy. Although a different model may apply in the future, that is the one that is in force today.
Firstly, we are not judging Ireland against any other country. We are judging Ireland against its own commitments, accepted in accordance with the broad economic guidelines. Secondly, we are not taking a decision that has just come out of nowhere and which was not anticipated. The Council’s 1998 recommendation already referred to the need for a stricter fiscal policy for Ireland. In the 1999 recommendation, a reminder was issued that, in spite of the efforts made, these were still not enough and, in 2000, after it was pointed out that the budgetary policy adopted by Ireland needed to be more restrictive, there followed a clear expansionist budget on Ireland’s part.
When I talk about an expansionist budget, I am talking about overall figures. I have no quarrel with more health expenditure or more expenditure on reducing tax. Those are policy matters to be decided upon at national level. As Commissioner for Economic and Monetary Affairs, my concern is with the overall status of the Irish budget. However, it is not only
concern but also that of Ireland’s Central Bank, which I assume is familiar enough with the situation of the Irish economy and clearly understands that the current budget gives a substantial procyclical boost to the economy. That is the situation, and these are the facts we are judging.
On that basis, we can talk about what we are, or are not, to do. My duty as Commissioner responsible for these matters is to apply the broad economic guidelines, which are compulsory in a way that the Stability Pact is not. The Stability and Growth Pact – to answer Mrs Torres Marques – was decided upon following a Community regulation. The broad economic guidelines are the model we duly agreed for inclusion in the Treaty of Maastricht. And what we have done is to apply this model strictly, as required. In contrast to what some believe, it is obviously not a position of the Commission. Rather, it is a position of the Commission and the Council. Nor, in making our proposal, did we proceed on the basis of any factor other than our own assessment of the point at issue.
No one should therefore imagine that there are motives or problems of any other kind, large or small. We are talking about consistency with the model we had duly established.
Reference was made to a greater degree of understanding. I believe that we have been showing understanding since 1998 but, in this situation, decisions obviously need to be taken at some point.
Reference was made to the lack of diplomacy on the part of the Commission. I can assure you that none of the leaks that have appeared in the press come from my department in the Commission.
Obviously, it may be thought that the best pupil in the class is being punished. As I have said, it is not a case of our imposing sanctions. We are using a recommendation to highlight an example of incorrect behaviour in the light of the economic policy guidelines. And this is not inconsistent with good behaviour in terms of growth and inflation.
We could talk in much more detail. Mr Bradbourn intimated that not enough data had been provided. I am prepared to appear before the Committee on Economic and Monetary Affairs, whenever you think it appropriate, to comment in more detail on all the data we are talking about."@en1
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