• Austerity

A European Commission proposal to integrate the ‘Fiscal Compact’ into EU law has been rejected by MEPs this morning.

The Committee on Economic and Monetary Affairs (ECON) vote to enshrine the ‘Fiscal Compact’ – now an inter-governmental treaty – into law was tied at 25-25, meaning rejection by the committee. Confusion remains, however, as to what might happen next, with the committee chair now looking to legal experts for advice.

Had the proposals been accepted, the Commission would then bind all member states to its content.

GUE/NGL welcomes the change of position by other political groups – many of whom had supported the deepening of the European and Monetary Union over many years.

By contrast, GUE/NGL has always strongly opposed not just full incorporation of the so-called ‘Fiscal Compact’ into member states’ law – but the treaty itself.

The ‘Fiscal Compact’ – with rules such as deficit and debt limits – restricts EU member states’ sovereignty and ability to respond to their economic and social needs. Its practical application upon member states has also exposed its true intentions as well as the adverse consequences for workers and people.

GUE/NGL’s ECON members see the Commission’s budgetary supervision and monitoring as nothing but tools for more blackmailing and oppression, imposing neoliberal economic and social policies and impeding the sovereign pursuit of progressive policies.

The approval of this proposal would have meant the austerity straitjacket becoming EU and member state law. That would entail the loss of labour and social rights, wage cuts and the continuous destruction of public services like health and education.

The true intention is to make neoliberal policies mandatory.

On behalf of all EU workers and people, GUE/NGL MEPs on the committee have urged the rejection of the Commission proposal ‘laying down provisions for strengthening fiscal responsibility and the medium-term budgetary orientation in the Member States’.

We are also demanding the repeal of The Treaty on the Functioning of the EU, the Stability and Growth Pact and the intergovernmental Treaty on Stability, Coordination and Governance – the legal basis for this proposal for a Directive.

The group’s shadow on the report, Marisa Matias (Bloco de Esquerda, Portugal), said after the vote that the fight against the ‘Fiscal Compact’ will continue:

“The fight against the ‘Fiscal Compact’ has been at the core of GUE/NGL political proposals.”

“Today’s vote marks a new opportunity to reject the measures that have imposed even more austerity on European citizens over many years.

“This is not the end of the road, however, as there is now huge uncertainty concerning the outcome of this vote. Nevertheless, we managed to stop the process and we will keep fighting to regain both democratic procedures and the defence of people’s rights across EU,” she said.

GUE/NGL coordinator on the ECON committee Miguel Viegas (PCP, Portugal) said:

“The rejection of the Fiscal Compact by the economics committee shows that, with the approaching elections, parties that have always been fully committed to the euro are beginning to understand how unhappy people are with austerity policies that are linked to the single currency.

“From our side, we will continue – as we have always done – fighting against the euro and its policies!” he concluded.

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