In October, the European Economic and Social Committee (EESC) adopted a package of opinions on EU economic governance, providing European decision-makers with new input for the ongoing discussions on deepening economic and monetary union (EMU) and the next European Semester exercise.
In the package, the EESC endorses the Commission's proposals to set up a reform support programme (RSP) and a European investment stabilisation function (EISF) for the new EU budget (2021-2027). This would be a welcome step towards improving EU economic integration and governance.
However, it would be a good idea to monitor the social impact of structural reforms carried out with the support of the RSP and extend the programme to projects of pan-European importance. The success of the new instrument would depend on fine-tuning a number of issues: the definition of structural reforms, the procedures for evaluating them and the conditions for disbursing funds.
The EESC also has concerns about the size of the EISF. It might be insufficient in the event of shocks affecting two or more Member States. The EESC believes that having unemployment as the sole criterion for activating support might reduce the timeliness and effectiveness of the tool.
Other complementary criteria could indicate an impending large shock even earlier. This would make it possible to trigger support before large shocks happen. The EESC also recommends further developing the EISF and looking into how an EU-wide insurance mechanism could operate.
On euro area 2018 economic policy, the EESC calls for a positive aggregate fiscal stance in the euro area. Greater investment spending in surplus countries would be an economic policy necessity. Creating favourable environments for business investment and innovation should also be a priority for economic policy, as should reducing job insecurity, poverty and inequality. (jk)