Future EU economic governance must mark a 'turning point', not a 'return to normal'

The European Commission's 2020 economic governance review is timely and should pave the way for a comprehensive reform, making a 'turn' to a revised and rebalanced framework instead of a 'return to normal'.

In an opinion drafted by Judith Vorbach and Tommaso Di Fazio and adopted at the September plenary, the EESC argues that a new economic policy is needed at EU level - one that focuses on prosperity to promote people's well-being and on a range of key policy objectives, such as sustainable and inclusive growth, full employment and decent work, fair distribution of material wealth, public health and quality of life, environmental sustainability, financial market and price stability, well-balanced trade relations, a competitive social market economy and stable public finances.

Urging the Commission and the Member States to resume their reflection on the current EU rules in the wake of the COVID-19 pandemic, Ms Vorbach said: "We urgently need to revise and modernise the economic governance framework. It should be more balanced and have prosperity at its heart, promoting the well-being of people in Europe. Nobody must be left behind. One way to do this is to apply the "golden rule" for public investment to safeguard productivity and the social and ecological base for the well-being of future generations. Further important points are ensuring sufficient public revenues, a fair taxation policy and mitigating the influence of economically questionable indicators on policy-making. Also essential will be closer involvement of the European Parliament, of the social partners and of civil society as a whole."

Echoing her words, Mr Di Fazio added: "The COVID-19 crisis is a massive shock, requiring full financial power. Harmony of purpose is needed to contain the economic and social consequences of this pandemic and to share the burden of the resulting damage equitably within and between Member States. Important short-term measures have already been established, such as the activation of the fiscal framework's general escape clause. However, instead of going for a 'return to normal' too quickly, we must take a leap forward and make a 'turn' towards a revised economic vision, one that steps up investment in training, research and development, and strategic productive activities." (mp)