Ecofin sets guidelines for a sustainable economy
© Gina Sanders, Fotolia.com
On 12 February 2013, the Ecofin Council discussed actions to support budgetary discipline and competitiveness, such as guidelines for the EU's 2014 budget, the annual growth survey, the alert mechanism report, and the fiscal sustainability report. The priority is to ensure fiscal consolidation whilst promoting growth and jobs.
Guidelines for the 2014 budget
The Council adopted conclusions establishing its priorities for the EU's general budget for 2014. The conclusions emphasise the need to maintain budgetary discipline in a context in which many member states are seeking to reduce their deficit and debt levels. They also call for a balance to be struck between fiscal consolidation and the need to continue investment, with particular emphasis on actions that best contribute to growth and employment.
The European Semester
The Council adopted conclusions on the Commission's annual growth survey, which outlines actions to ensure more effective and better-coordinated policies for fostering sustainable economic growth in Europe.
In its conclusions, the Council agreed with the broad priority areas indicated by the Commission. It emphasised that the growth and debt challenges confronting the EU economy continue to be serious. It also highlighted that the main priorities are to improve confidence and revive economic growth, ensure debt sustainability and improve competitiveness, while creating conditions for sustainable growth and jobs in the longer term.
Ministers also adopted conclusions on the Commission's annual alert mechanism report, which is the starting point of the annual macroeconomic imbalances procedure. The report identifies which member states may have an imbalance, and which member states warrant an in-depth review.
The Council noted in its conclusions that many EU economies continue to face important challenges in correcting the external and internal imbalances accumulated in the pre-crisis period, including high public and private debt levels, divergences in competitiveness and financial imbalances. It welcomed the fact that the member states with the largest imbalances have implemented significant structural reforms, leading to gains in competitiveness in these countries, and contributing to a rebalancing of positions in the EU and within the euro area.
The Council adopted conclusions on the Commission's latest fiscal sustainability report. The conclusions underline the need to return to sustainable positions in order to improve fiscal positions further. They reaffirm that strict adherence to the EU fiscal rules is necessary to ensure sustainable debt levels. The reduction in debt ratios will have to come mainly from fiscal consolidation and reform of pension and care systems, but structural reforms are essential to support potential growth.