Local view for "http://purl.org/linkedpolitics/eu/plenary/2003-12-03-Speech-3-082"

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"Mr President, I should like to make some constructive points about how to get out of the present mess. The first is that there must be a sense of shared responsibility. Remember that the problem for both Germany and France began because of the budget relaxations, the tax cuts and public spending increases introduced between 1999 and 2002. In each country that budget easing amounted to more than 1.5% of GDP. If it had not happened, both countries would today be within the 3% limit. Yet no institution, neither the Commission nor the European Central Bank, nor any Member of this House, warned those governments against such easing. The system failed and we are all duty-bound to put it right. This is important, too, because the Stability and Growth Pact is not a judicial procedure, but a political procedure that relies on the support of the finance ministers for recommendations and, ultimately, sanctions. Ministers and the Commission must have a common understanding of how the Pact should be applied. There should be a clear code of conduct on the interpretation of the Pact so that it can be credible for the future. There must be a reinforcement of discipline in the good years and, in the short term, there must be an agreement on the size and speed of the adjustments necessary for the countries in breach to move back to balance. The Pact itself recognises that it will not always be possible to remedy excessive deficits immediately if there are special circumstances. Those special circumstances should now be defined to include the risk of a further prolongation of the recession in Germany and in France which, together, represent half of the euro area. It is not in anyone's interest to prolong the recession, nor is it in anyone's interest to undermine the credibility of the Pact. The law must be respected. With goodwill and imagination this circle can be squared. We urge the Commission and the finance ministers to do so."@en1

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