The Six Pack, The Fiscal Stability Treaty and the Two Pack

[C. Flower]

The big EU machine is rolling forward, largely undiscussed unless its business crosses the line into Referendum territory.

There is a summary here of the Six Pack, the Treaty and the Two Pack.

http://ec.europa.eu/economy_finance/...ix_pack_en.htm

The "Two Pack" - voted on last week in the European Parliament - was opposed by the ULA and barely mentioned in the Press, pre-occupied with Wallace and a number of murder trials.

The European Parliament debated the so-called ‘two-pack’ agreement (‘Economic and budgetary surveillance of Member States with serious difficulties with respect to their financial stability in the euro area’ and ‘Monitoring and assessing draft budgetary plans and ensuring the correction of excessive deficit of the Member States in the euro area’)during the June plenary session 2012.

The "Two Pack" is also designed to stop any state from defaulting / going into bankruptcy.

Article source: http://www.paulmurphymep.eu/paul-mur...pack-agreement

Murphy says that "shrouded in euphemisms" the Two Pack includes a mechanism to force countries into austerity programmes, that "enhanced surveillance" means - placing countries into administration - legal basis for the semi colony status of many EU countries and to undermined the rights of elected governments to decide on budgetary policies.

"The policies enabled by this are against the interests of the millions, but work for the multi-millionaires who you, (Ollie Rehn/the Commission) represent."

Statements on the Two Pack - http://ec.europa.eu/avservices/servi...&filmRef=84162

It was discussed in Committee in the Daíl in March.

http://www.oireachtas.ie/parliament/...e-7354-en.html

In spite of my best efforts I have not been able to locate the Two Pack text. There is a summary of the original proposals, and the amendments here. It's clear that politically it was felt necessary to include provison to discuss eurobonds and for some kind of growth package as an add-on.

http://www.europarl.europa.eu/news/e...ce-two-pack-QA

Sounds to me as though it needs a referendum.

http://online.wsj.com/article/BT-CO-...13-712100.html

[C. Flower]

Again, the Two Pack was very quietly "agreed" under the Irish Presidency last month.

I still haven't seen the wording of the Two Pack and it isn't linked from the Merrion Street report. Does anyone have it ?

Hard to see why it and the Six Pack did not trigger a referendum in Ireland.

In 2011, six new sets of rules, the so- called ‘Six Pack’, came into force to strengthen economic coordination among EU member states. European countries agreed to share information and coordinate their national economic and budgetary plans But the 17 eurozone countries needed further rules – these are in the ‘Two Pack’.
The ‘Two Pack’ consists of two regulations: one with special measures for monitoring and assessing plans of countries with high, excessive government deficits; and another with special measures for countries experiencing severe financial difficulties, such as those emerging from an EU-IMF programme.
The agreement reached with the European Parliament includes a commitment by the European Commission to set up a working group to study, amongst other issues, the feasibility of creating a debt redemption fund for eurozone countries with excessive sovereign debt.

20 February, BRUSSELS – The Irish Presidency has this morning helped broker an agreement on behalf of EU member states on new rules to stabilise eurozone economies. The new rules, the ‘Two Pack’, will improve budgetary and economic coordination among eurozone countries. Agreement was reached after talks this morning with the European Parliament and the European Commission.
The Irish Minister for Finance, chair of the ECOFIN Council, Michael Noonan said:
I very much welcome this morning’s agreement on the ‘Two Pack’. This is a key piece of the eurozone’s economic architecture and has been an Irish Presidency priority.
The agreement reached today will have to be approved by member states’ Ambassadors, as well as by Council and Parliament before becoming law.

http://www.merrionstreet.ie/index.ph...lity-measures/

Press Release on it - but still no wording for the Regulations.

http://europa.eu/rapid/press-release_MEMO-13-196_en.htm

[C. Flower]

The double jeopardy of the 'Two Pack' -

http://corporateeurope.org/news/double-jeopardy

In February, EU Commissioner Olli Rehn warned Belgium that it should stick to its budget deficit goal of 2.15% of GDP for 2013, after having missed its 2012 target of 2.8%. Around the same time, the negotiations between the European Parliament and the Council on two new regulations on stronger budgetary surveillance in the euro area were concluded. When the Parliament votes on the result on Tuesday the 12th of March, the hand of the Commission will be strengthened in imposing austerity measures. As Rehn commented, the adoption of the so-called two-pack was a first big step towards the “Deep and Genuine Economic and Monetary Union” that Rehn and Barroso are envisioning.

Rehn’s attack on the Belgian government was unusually blunt and open. The Finnish conservative ex-minister is clearly unsatisfied with the budgetary performance of the host country of most EU institutions – he wants action, and not just any action. Only four years ago, such a warning from a Commissioner would be serious, but not particularly frightening for a government. But that was a different European Union. A wave of reforms have strengthened the hand of the Commission, and some say Belgium could be the first country to be subject to sanction under the new rules1 [1] . But the Commission would like to be able to do more than just fine a government that has not met its budget deficit target. It wants the power to be able to tell a government how that target should be reached. Conveniently, the EU recently adopted some of the instruments Rehn will be able to use in the future to have it his way.

[C. Flower]

A good list of 2011 Regulation changes showing the extent to which budgetary control has been centralised in the last year, but no specific mention of the 'Two Pack'

http://ec.europa.eu/economy_finance/...e/index_en.htm

[C. Flower]

@Greengoddess - do you have the wording of this ? Did you vote for it ?

Brussels über alles
The main difference between the “two” and the “six” packs is nothing less than the national sovereignty. The first one has been designed especially for the Eurozone and briefly concedes the approval of the national state budgets to the Brussels’ Commission. In short, government budgets in the 17 Eurozone countries will be submitted to national Parliaments after the Commission has given its approval.
This most important law, however, that the 17 legislatures are debating every year will be submitted after the Commission has approved the text. There goes out of the window, any democratic accountability, given that the Commission as a body is not accountable to the people, nor the Commissioners are elected by the people and probably do not always work for the people.

http://europeansting.com/2013/02/21/...from-brussels/

The question is though, if those amendments the European Parliamentarians agreed with the Commission, are enough to protect the Peoples of Eurozone from the Commission’s discretional powers? In reality the amendments brought about by the Parliament are of minor importance not changing the substance of the “two pack”, which is the loss of national sovereignty.
As a matter of fact, the EU Parliamentarians depend greatly for their election on their home political party chiefs and governments and, as a result, they rarely push their objections to the end. European Parliament voting procedures are open for everybody to see who votes for what and this is not at all democratic.
In this case, the press release issued by the European Parliament contains this deplorable paragraph: “Where countries are asked to make substantial cuts, their efforts must not harm investments in education and healthcare, particularly in countries in severe financial difficulty”. As if today’s problems in Greece, Spain, Portugal, Italy and Ireland were education and health care. It is a totally populist reference, to hide the real issue which is the huge income losses for tens of millions of people.
In short, the green light from the European Parliament for the “two pack”, without any changes in its basic provisions, opened a new era in the European Union, of less and less democratic accountability and more and more democratic deficits. And this without a new Treaty being signed or anything that could signal fundamental changes and attract the attention of the many. Everything was done away from the eyes of the people in a freezing Tuesday morning in central Brussels. In reality, the Peoples of the EU are now pushed into something quite different from what they knew so far, without much discussion or a referendum. Nobody in Brussels speaks any more about plebiscites.

[ang]

Two Pack -

TWO-PACK

Work in progress: Discussions between Commission, Council and Parliament are ongoing;

Shall be agreed in summer (indicative);

Two Regulations;
Applicable to euro-area Member States only (based on Art 136 TFEU);

Aims at further strengthening the surveillance mechanisms in the euro area;

Regulation on monitoring and assessing draft budgetary plans and ensuring the correction of excessive deficits in euro-area Member States (original Commission proposal):

Common budgetary rules at the national level shall be monitored by independent institutions.

As part of a common budgetary timeline, euro-area Member States shall submit their draft budgetary plan for the following year to the Commission and the Eurogroup before 15 October, along with the independent macro-economic forecast on which they are based.
This builds on the Stability and Growth Pact (SGP), under which Member States present the main characteristics of their medium-term public finance plans to the Commission and the Council in spring (in Stability or Convergence Programmes). The exercise in autumn introduced by the two-pack allows monitoring and sharing information on MS budgetary policies closer to their adoption. The Commission analyses if the draft budget is in line with the SGP and the recommendations from the European Semester (which the country has received in May/June).

If the Commission assesses that the draft budgetary plan shows serious non-compliance with the SGP, the Commission can require a revised draft budgetary plan. Otherwise it may address an opinion to the Member States concerned, which would also be discussed by the Eurogroup.
This Regulation therefore complements the preventive arm of the SGP, in particular, by ensuring appropriate integration of EU policy recommendations in the national budgetary preparations and increasing peer pressure in the Eurogroup.
The National Parliaments remain fully sovereign in voting the Budget Law. With the Regulation, they would be now equipped with an independent opinion on the budgetary plans, namely the Commission opinion.
For euro-area Member States in EDP, the Regulation introduces a system of graduated monitoring in order to secure a timely and durable correction of excessive deficits. This would in particular allow an early detection of risks that a Member State does not correct its excessive deficit by the deadline set by the Council, and permit to take action accordingly.
The co-legislators, together with the Commission, are aiming at incorporating elements of the TSCG in this Regulation: in particular, the requirement to set up independent institutions in charge of monitoring fiscal rules which should implement the MTO at the national level, ex ante coordination of debt issuance plans and economic partnership programmes detailing structural reforms necessary to ensure an effective and durable correction of the EDP.

Regulation on enhanced surveillance of euro-area Member States experiencing or threatened with financial difficulties:
euro-area Member States experiencing or threatened with serious difficulties will be subject to enhanced surveillance. Commission may decide this.
Automatic enhanced surveillance for countries receiving certain types of precautionary financial assistance (in keeping with EFSF and future ESM guidelines). The list of precautionary assistance instruments concerned will be established and maintained by the Commission.
Surveillance involves
An obligation on Member States to adopt measures to address the sources of instability.
Regular review missions and the provision of more detailed or disaggregated financial sector data if requested.
Quarterly reporting by Commission to Eurogroup Working Group.
Procedure for deciding and monitoring a macro-economic adjustment programme:
Member States facing insufficient administrative capacities must seek technical assistance from Commission (e.g. Task Force for Greece).
If necessary Council may decide that beneficiary Member State does not comply with policy requirements contained in the adjustment programme. As a result, the country concerned would face financial consequences with regard to the disbursements under the programme.
Simplification of the monitoring of programme countries: In order to avoid duplication and overburdening, the monitoring under the SGP and the implementation of the Macroeconomic Imbalance Procedure and the European Semester shall be suspended, as programme countries are per se subject to wide ranging surveillance and strict targets.
Post-programme surveillance: According to the draft regulation, a country shall be subject to post-programme surveillance as long as it has not repaid 75% of its debt.

[C. Flower]

Very informative, but is that the wording of the agreement ang ?

This surely requires a Referendum ?

It would enable every detail of our budget to be set outside Ireland.

[ang]

Very informative, but is that the wording of the agreement ang ?

This surely requires a Referendum ?

It would enable every detail of our budget to be set outside Ireland.

Full (I assume draft wording) here on regulation 1 - http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEXKEY=627835:EN:NOT

Full (again assume draft) here on Regulation 2 - http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEXKEY=627834:EN:NOT

Sould require referendum but that is not going to happen.

Yes every detai scrutinised

[C. Flower]

I wonder if this was added on as a gesture to the future level of democracy in the Eu?

13. In order to enhance the dialogue between the Union institutions, in particular the European Parliament, the Council and the Commission, and to ensure greater transparency and accountability, the competent committee of the European Parliament may offer the opportunity to the Member State concerned by a Commission recommendation to participate in an exchange of views,

Well done for finding that. It is dated 2011, so there is the possibility the Regs were amended. I may make a phone call to check on Monday.

[Dojo]

Very informative, but is that the wording of the agreement ang ?

This surely requires a Referendum ?

It would enable every detail of our budget to be set outside Ireland.

No it wouldn't. Stop lying.

The National Parliaments remain fully sovereign in voting the Budget Law. With the Regulation, they would be now equipped with an independent opinion on the budgetary plans, namely the Commission opinion.

Therefore national budgets would only be subject to analysis by the Commission. Member states can choose to accept recommendations of the EC or ignore them in their entirety.

[ang]

Budgets should not under any circumstances be subject to scrutiny by others before being presented to elected National Parliaments.

It's probably unconstitutional.

[C. Flower]

No it wouldn't. Stop lying.


Therefore national budgets would only be subject to analysis by the Commission. Member states can choose to accept recommendations of the EC or ignore them in their entirety.

Except that -

Thanks to these new reporting procedures, the Two-Pack strengthens the SGP by adding to the Commission's toolbox for making recommendations. For example, if the Commission flags in its opinion that a draft budget is not in line with its SGP obligations but the Member State in question does not take measures to correct it, this early flagging by the Commission can be used later to form part of the evidence in deciding, for instance, whether to place the Member State in EDP if its deficit or debt is not consistent with SGP rules.