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EMU: Roberto Gualtieri responds to Jean-Claude
Juncker
The chair of the ECON committee answers the 11 questions submitted by the Commission
president to the member states
By NEWSROOM / REDACTION
25 March 2015 Last updated 20:00
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MEP Roberto Gualtieri (S&D, Italy),
EP
Just as Mario Draghi called for a "quantum leap" in institutional convergence for the Economic and
Monetary Union, Europolitics asked MEP Roberto Gualtieri, chair of the Committee on Economic and
Monetary Affairs (ECON), to respond to the 11 key questions submitted by Jean-Claude Juncker to the
member states during the informal European Council back in February.
How can we ensure sound fiscal and economic positions in all eurozone member
states?
The precondition is relaunching sustainable growth with an appropriate policy mix of a fiscal policy
avoiding pro-cyclicality, an EU investment strategy, structural reforms, stronger social policy and monetary
easing.
How could a better implementation and enforcement of the economic and fiscal
governance framework be ensured?
More attention must be paid to the eurozone as a whole, including its macroeconomic imbalances. The
best use of flexibility should ensure that the rules are enforced in the framework of a viable economic
policy strategy and not in a mechanical and bureaucratic way or on the basis of a country-by-country
approach. Current account surpluses should be persistent. The use of positive incentives should better
complement the threat of sanctions. Enhanced economic policy coordination should be based on more
binding convergence guidelines defined at EU level on the one hand, and on the other hand on stronger
ownership of concrete reforms at national level. An appropriate level of democratic legitimacy involving the
European Parliament and the national parliaments at the respective levels should be ensured.
Is the current governance framework – if fully implemented – sufficient to make the
eurozone shock-resilient and prosperous in the long run?
No. In the long run the EMU requires a fully-fledged economic government with an appropriate fiscal
capacity and a shared competence on economic policy. Meanwhile, the current governance framework
should be streamlined and improved.
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EMU: Roberto Gualtieri responds to Jean-Claude Juncker | Europolitics
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To what extent can the framework of EMU mainly rely on strong rules and to what
extent are strong common institutions also required?
The current framework is already based not only on rules but also on institutions. Their role must be
enhanced by transforming the European Commission into an economic government, by giving the
European Parliament full co-decision in the area of economic policy and taxation, and by transforming the
ESM in an EU monetary fund, fully incorporating it into the Union law.
What instruments are needed in situations in which national policies continue – despite
surveillance under the governance framework – to go harmfully astray?
A "eurosystem of fiscal policy with direct power to overhaul national parliaments' fiscal and economic policy
prerogatives," as recently suggested by Bruegel, does not seem constitutionally viable or appropriate. As it
is the case in all federal entities, competences and resources at EU level should be gradually
strengthened, while being better distinguished - on the basis of the principles of subsidiarity and
proportionality - from national level instead of being further confused and overlapped.
Has the fiscal-financial nexus been sufficiently dealt with in order to prevent the
repetition of negative feedback loops between banks and sovereign debt?
Big steps have been made with the SSM, the SRM and the new set of regulations of the financial markets.
Now the banking union has to be completed (including an appropriate deposit guarantee mechanism and a
fiscal backstop for resolution), shadow banking has to be better regulated and the capital markets union
must be appropriately designed and implemented.
How could private risk-sharing through financial markets in the eurozone be enhanced
to ensure a better absorption of asymmetric shocks?
A viable and well regulated capital markets union, including a common supervision, could contribute to this
aim, but this cannot substitute for the need for public asymmetric shock absorbers.
To what extent is the present sharing of sovereignty adequate to meet the economic,
financial and fiscal framework requirements of the common currency?
The current asymmetry between the EU's exclusive competence on monetary policy and coordination
competence on economic policy, and the limitations in the area of taxation, own resources, debt
management, and in the capacity to properly organise a social level playing field in order to avoid social
dumping, are inadequate in the long run.
Is a further risk-sharing in the fiscal realm desirable? What would be the preconditions?
Yes it is. The preconditions are the strengthening of the EU public sphere and political parties and the
relaunch and "politicisation" of the Community method. It is a process which has started with the 2014
European Parliament elections and the Juncker Commission but has to further go ahead. In any case, the
current legal framework and the improved level of democratic legitimacy already allow some forms of risksharing in the fiscal realm.
Under what conditions and in which form could a stronger common governance over
structural reforms be envisaged? How could it foster real convergence?
The macroeconomic imbalances procedure (MIP) already provides a number of instruments for enhanced
economic policy coordination. In the short run, it should be better used and reinforced with the definition of
convergence guidelines at the EU level [see answer No 2] and with a mechanism of incentives based on
the SGP's flexibility and on new common financial instruments to be used as embryo for a fiscal capacity.
In the long run, economic policy should become a shared competence.
How can accountability and legitimacy be best achieved in a multilevel setup such as
EMU?
Accountability and legitimacy should be provided at the level where decisions are taken. Enhanced EU
competences require a stronger role for the European Parliament. Under the current legal framework, an
interinstitutional agreement could better involve the European Parliament in the 'semester' process, namely
in the preparation of the 'Annual growth survey'. A treaty change should introduce co-decision on these
matters. A formal division of the European Parliament on national lines (eurozone committee) is
incompatible with the current treaties and is neither necessary nor appropriate, as the euro is the currency
of the Union, and its governance affects also citizens of non-euro countries. The Council represents the
member states, the European Parliament the Union's citizens. The fact that currently a number of
decisions ('two pack' regulation under Article 136 TFEU, the election of SSM and SRM chairs and board
under the respective regulations) is taken in an asymmetric format is an element of institutional balance
and not a democratic shortcoming. Informal arrangements to improve EMU scrutiny are possible.
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EMU: Roberto Gualtieri responds to Jean-Claude Juncker | Europolitics
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