Reforming the European Semester for a resilient, sustainable and inclusive Europe

Dear Commissioner Elisa Ferreira,
Ladies and Gentlemen,
Dear colleagues,

Welcome to the annual event of the EESC's European Semester Group whether you are taking part remotely or from the room. In particular, my thanks to Commissioner Ferreira, we are very happy to have you here today. I hope it is a sign of appreciation of the work and the support of the EESC ever since the pandemic broke out and the recovery measures first started being conceived.

Europe has been grappling with the pandemic and its impact for two years and is now faced with a crisis of a different nature: the war in Ukraine. I and all members of the European Economic and Social Committee condemn this unjustified and unprovoked invasion and our solidarity goes out to the Ukrainian people whose lives are destroyed. We wholeheartedly endorse the EU's strong position and join the call for an immediate stop to military action on Ukrainian soil. The EU and every Member State need to continue to live up to their responsibilities by protecting people, democracy and our shared values. "We do whatever it takes".

At the same time, we know that this war undermines the European and global security and stability, confronts the EU with some immediate challenges and will have long term-structural consequences we are only beginning to understand. As the impacts on the EU Member States will be asymmetric, solidarity and a common European response to mitigate the new economic and social hardships will be key. Solidarity is the hallmark of the EU. It is the foundation of our economic and social model, and dialogue is its central element.

In this regard, the European Semester process, this overarching surveillance and coordination tool, which is also a framework for dialogue between Member States, must fully play its role in coordinating economic and related policies. Over the years, it has become a quite efficient economic and social governance tool for the European as well as the national institutions. The EESC appreciated its new focus on supporting a solid socio-economic recovery and on fostering sustainable and inclusive growth, in line with the European Green Deal and the concept of competitive sustainability.

The Recovery and Resilience Facility is closely linked to the European Semester. The recommendations for economic reforms issued under the Semester have become a central element of the conditionality of the RRF. And the supervision of the implementation of the National Recovery and Resilience Plans (NRRPs) will be the main task of the Semester until 2026.

Ladies and gentlemen,

The EU and its Member States are still recovering from the pandemic, while they are also facing the consequences of the crisis in Ukraine for their economies and societies. This undoubtedly presents new challenges for Europe as it needs to reinforce its strategic autonomy.

A key element in this is, for example, the need to reduce our dependence on foreign energy, in particular energy from regimes whose values and political objectives are fundamentally opposed to those of the EU. Moreover, the objectives of the measures and instruments of the Green Deal, may also be affected by a prolonged war in Ukraine and its geopolitical implications. As the EU seeks to enhance the resilience of its energy supply system and reduce its energy dependence on Russia, the EESC believes that it is crucial to support the European Commission's REpowerEU Plan and its four key actions – saving energy, diversifying supplies, quickly substituting fossil fuels by accelerating Europe’s clean energy transition and smartly combining investments and reforms.

This reflection on the support to our economies and the necessary reform of the European Semester must also take into account the need for the Europe of tomorrow to be based on an inclusive and resilient green and digital economic model. The EU Member States must have appropriate fiscal space to counter the negative economic and social effects of the war in Ukraine. This further reinforces, according to the EESC, the need to revise EU economic governance framework and to enhance its effectiveness.

We need a rebalanced and a prosperity-oriented model of coordination of Members States’ macroeconomic and fiscal policies. As a consequence, it cannot be overstated how important it is to implement the Recovery and Resilience Plans effectively and fairly.

Indeed, as we have already seen, the COVID-19 crisis has disproportionately impacted certain groups, industrials sectors, regions and countries more than others. Women are among the “vulnerable” groups who pay the consequences of also lack of public targeted policies and tools to improve their participation in the labour market and to increase their access to quality jobs. Also, young people need special attention in this situation. Here again, the organised civil society has a crucial role to play in this. And as you know, the EESC is ready to continue to play its part. In particular, through our dedicated European Semester Group (ESG), we follow closely the different phases of the national recovery and resilience plans by using our network of social partners and NGOs across Europe.

The EESC adopted a resolution in February 2021, which showed that during the preparation of the national Recovery and Resilience Plans, many Member States did not engage in sufficient consultation with organised civil society, or did so too late. Furthermore, in its resolution adopted a fortnight ago, the EESC draws attention to the need for greater transparency in the implementation and monitoring of the plans. We encourage the national governments of those Member States where the participation of the social partners and civil society organisations is still insufficient to remedy this situation as a matter of urgency. All national governments should comply with the rules laid down in the RRF Regulation. And we call on the European Commission and Parliament to enforce compliance with the rules in force.

In addition, we believe that the lack of effective and quality participation of organised civil society in the economic governance of the EU will not be resolved in a satisfactory manner until there is a reform of the European Semester which guarantees this via a directive or a regulation. Moreover, in its resolution, the EESC stresses that the Ukraine war and its immediate risks to the European and global economy should encourage European institutions and national governments to speed up the implementation and enforcement of the National Recovery and Resilience Plans, as well as the associated investments and reforms.

We must also push forward the EU Green Deal, in order to sustain growth and accelerate the decarbonisation of the energy system and the green strategic autonomy of the European Union. In this regard, already prior to the outbreak of the war, the total amount of national and Next Generation EU funds was insufficient to achieve the objectives of the Green Deal and deliver the just and inclusive energy transition required. This is why the EESC proposes assessing the creation of a new financial investment instrument. Such instrument could combine the best elements of the RRF and the EU's investment programme, InvestEU to reinforce the momentum of ongoing green and digital transitions. Besides, while the EU needs to successfully unleash the potential of the Recovery and Resiliency Facility, one should also bear in mind that the heavy burden of large loan-taking in order to finance the recovery for future generations, who will have to pay the debt back.

Therefore, the more all relevant stakeholders are involved in the process, the more we can demonstrate the money is not simply spent but well invested into the future of our businesses, workers and societies, the easier it will be to convince European tax-payers that RRF-money is a fantastic opportunity for their individual futures. This issue is now becoming urgent.

To tackle present and future challenges, we need to take fair, appropriate, and courageous decisions for the European citizens and the Europe of tomorrow. And to accomplish this, the interlinkages with civil society must be strong, efficient and well organised. Our aim is to create more transparency, to raise awareness and to mobilise national civil society organisations, in particular to enhance their involvement in the European Semester process.

Finally, it is also essential to think about how to adapt the national recovery and resilience plans and ensure the flexibility of the RFF, under the framework of the European Semester, to make sure that its capacity for economic steering is fully achieved. I am very pleased that the guest speakers, EESC members and all interested stakeholders have gathered today to discuss and reflect together on how we can deepen our cooperation on the European Semester and highlight the recommendations for its necessary reform and expectations of the European organised civil society.

Thank you for your attention!