Local view for "http://purl.org/linkedpolitics/eu/plenary/2007-04-25-Speech-3-424"
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"en.20070425.40.3-424"2
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".
Mr President, the Commission warmly welcomes Mr Lauk’s report and is grateful for the high-quality work of Parliament’s Committee on Economic and Monetary Affairs. With a strong economic recovery currently under way in Europe and in the euro area, Member States have an outstanding opportunity to improve their public finances and to prepare for future challenges, such as the ageing population. In this context, Mr Lauk’s report is a very timely one.
The Commission clearly agrees with the report’s statement that the revised Stability and Growth Pact is so far working as it should. In particular, many Member States have made considerable efforts to meet their obligations under the Pact. Since the reform of the Pact, both the corrective and preventative arms have been fully applied in accordance with the reform’s provisions. In addition, it is clear that there has been no leniency in the enforcement of the reformed Pact.
Last year, a significant improvement in the general government deficit in the euro area, and in the individual Member States, was accomplished. For the euro area, the improvement was 0.9%, in nominal terms, and hence also appears likely to be higher in structural terms than the 0.3% expected by the Commission last autumn.
The overall economic prospects for 2007 are equally encouraging. The ongoing presence of cyclically favourable conditions in the euro area calls for further fiscal consolidation efforts in 2007 and beyond. Adjustment towards the medium-term budgetary objectives should be stepped up and pro-cyclical budgetary policies ought to be avoided.
Euro-area Finance Ministers confirmed last week their commitment to make full use of current economic growth and better-than-expected tax revenues to pursue sound fiscal policies, as well as to use unexpected extra revenues for deficit and debt reduction.
The Commission also shares Parliament’s concerns regarding the long-term sustainability of public finances and is putting increased emphasis on its assessment. In this respect, a new report on the long-term sustainability of public finances in the European Union was issued by the Commission in October 2006. That report is based on EU common ageing-related expenditure projections. It confirms the importance of addressing the sustainability challenge with a combination of fiscal consolidation and structural reforms.
The Commission has continued its work on incorporating sustainability considerations in setting the medium-term budgetary objectives. Indeed, the improvement of fiscal balances in the medium term contributes to meeting the long-term sustainability implications.
Another key development is the emphasis on improving the quality of public spending, in line with the Lisbon Strategy. That policy guideline is indeed part of the integrated guidelines adopted by the European Council in March this year. The Commission is also grateful for the report’s recognition of the efforts made to improve statistical governance. The Commission recently reported to Parliament and to the Council on the quality of the data submitted by Member States.
Finally, while the corrective arm of the Stability and Growth Pact has delivered the expected results, the picture is more mixed regarding the preventative arm. National fiscal rules and institutions can play an important role in this respect. Progress was made last year in this field, and the Commission is currently working on further improving the effectiveness of the Pact’s preventative arm. In this context, I fully appreciate Parliament’s support for this approach."@en1
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