Local view for "http://purl.org/linkedpolitics/eu/plenary/2001-05-03-Speech-4-028"
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"Mr President, I would first like to express my satisfaction with the report, initiated by Parliament, on the stability and convergence programmes prepared by Mr Katiforis.
Paragraph 10 of the motion for a resolution refers to improved harmonisation of the timetable for presentation of Member States’ programmes. We agree on this and have always felt it necessary to update programmes before budgetary procedures. We have stressed this point and will continue to do so. We trust that in the future we will at least be able to ensure that the programmes in question will be updated at the same time as budgetary procedures are initiated.
Mr Katiforis also refers to the need to have the Commission’s documents available. That is a long-standing debate. We in the Commission do believe it is important for Parliament to have access to as much information as possible. Nonetheless, we also feel that the nuances or minor differences between the Commission’s proposal and the Council’s final decision are irrelevant as far as public opinion is concerned. We think the debate should focus mainly on those features eventually adopted by the Council. For that reason we feel that making earlier documents available would complicate rather than simplify the process.
I will now turn to Paragraph 9, which deals with the Commission’s macroeconomic forecasts. As you are aware, these are prepared independently of the programme assessments. They are drawn up twice a year and published when they are ready. We have just brought out the latest ones, for the spring. They were forwarded to Parliament on 25 April. They point to a number of interesting developments which have also been mentioned today. Our position on the Irish matter is well known. Quite simply, all that happened in Ireland was that current regulations were applied. Another development worth mentioning is the reduction in growth as a result of the situation in the United States. I note that some of you, ladies and gentlemen, have floated the idea of a change in budgetary policy as a positive contribution to improving growth. As we see it, given the 2.8% predicted growth taken into account in the Commission’s forecasts, there is still plenty of scope for progress through the existing stability programmes. The Commission therefore continues to emphasise the need for the successful completion of these stability programmes. This does not mean, however, we do not believe that automatic stabilisers might prove helpful in a context of lower economic growth.
These were the issues I wanted to bring to your attention. It only remains for me to thank Mr Katiforis for his work and to express my appreciation to all of you for your contributions, criticisms and suggestions. Thank you again.
In March the Ecofin Council completed its assessment of the third round of programmes we presented. Increased monitoring of budgetary policies, following implementation of the stability and growth pact, is having very positive and beneficial results. I am not sure whether, as Mr Karas stated, this is a means of establishing political stability, or simply a way of maintaining a clear commitment as regards public deficits.
The Member States have improved budgetary consolidation though close cooperation. The latest figures show that ten of the current Member States anticipate that their public accounts will balance or show a surplus. All, apart from the United Kingdom, will have balanced their budgets by 2004. Public debt is decreasing significantly, and this year we expect it to fall below 60% in eleven of the fifteen Member States. I therefore believe we have made significant progress and, as Mr Katiforis said, I think we have achieved economic stability in Europe in budgetary terms.
It is true that, although the task of restructuring public finances has enabled us to make significant progress, it poses a number of problems relating to long-term sustainability and the standard of public finances. Basically, the Commission insists that progress must be made on both counts. We must continue to strive to reduce the present deficits and to balance public budgets at the earliest opportunity. There are still a number of cases of excessively high debts. These must be reduced, above all in order to tackle future budgetary problems.
In this regard, I would like to highlight aspects of the matter pointed out by a number of speakers. I refer amongst others to Mrs Randzio-Plath, who mentioned the need to improve the standard of public finances. Others spoke along the same lines. When we speak of the standard of public finances, we are referring not only to problems in the short-term, but also to those in the medium- and long-term. In the short-term, these obviously relate to the fiscal reforms which will improve the administration of taxes. In the medium-term they concern all matters related to improved public expenditure. I will refer to public investment, as set out by Mr Katiforis in his report, in a moment. Of course, there is the long-term problem of our ageing population, which should obviously be one of our main concerns at present.
The medium-term strategies defined by the Member States in their programmes clearly indicate their priorities. This enables us to reconcile the different views so as to improve coordination of our budgetary policies.
However, I would like to refer in detail to some of the problems raised by Mr Katiforis in his report. I wish to make some specific comments on the very important subject of public investment, to which Mr Katiforis dedicates a substantial part of his report. Firstly, I agree absolutely with him that, during the period of budgetary consolidation in the 1990s, many Member States reduced public investment, sometimes inappropriately. Secondly, it is true that the improvement in the situation should allow priority to be given to public investment. We would then be in line with the undertakings given in Lisbon. Their underlying aim is to improve our potential for growth. My third point is that public investment is not incompatible with private investment. Different types of investment can work alongside each other and can be interlinked. There is also scope for innovative financing methods. Often, there is no reason why the public sector should act in isolation as has traditionally been the case.
In giving greater priority to public investment, which I fully support, we must not however forget the other side of the coin: greater public investment does not necessarily mean increased deficit. We believe that the problem should be resolved by redirecting certain types of expenditure and keeping public deficit under control. In our opinion it is crucial for the public deficit to be controlled through budgetary discipline. It is essential to balance the books in the medium-term. It is true that measures such as the golden rule implemented in the United Kingdom are useful insofar as public investment can logically be financed thorough debt or deficit. However, such debt or deficit must not exceed the agreed limits. Certain categories of spending should therefore have priority.
Hence, encouraging public investment does not equate either with uncontrolled debt or with a significant increase in public expenditure. However, the Commission would obviously not endorse an increase in investment which could exceed deficit levels or current predicted expenditure levels."@en1
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