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April 23, 2024

Brussels Briefing: EU agrees ‘bullshit’ fiscal rules 

The European parliament says the agreed fiscal rules will better protect a government’s capability to invest © AFP via Getty Images
The European parliament says the agreed fiscal rules will better protect a government’s capability to invest © AFP via Getty Images

Green MEP lambasts lack of room for investment

“Tell me where?” asked an angry Philippe Lamberts, co-president of the Greens/European Free Alliance group in the European parliament, as MEPs geared up to vote in favour of fiscal rules that centre-right and centre-left politicians largely insist will give EU governments more bandwidth to invest.

“These rules provide more room for investment, flexibility for member states to smooth their adjustments, and, for the first time they ensure a ‘real’ social dimension,” said Socialist MEP Margarida Marques following the vote. 

The parliament said the agreed rules would better protect a government’s capability to invest by making it more difficult for the European Commission to place a member state under an excessive deficit procedure for essential investments. Further, national expenditure relating to the co-financing of EU-funded programmes will be excluded from governments’ expenditure calculations, “creating more incentives to invest”, added the parliament in a statement. 

The rules also require countries to reduce “excessive debt” on average by 1 per cent a year if it is above 90 per cent of gross domestic product, and by 0.5 per cent a year on average if it is 60-90 per cent above GDP.

Lamberts lambasted any notion the plans would create any room for investment. He suggested discussions between MEPs prior to the vote were akin to “an Orwell novel”, in which words uttered did not correspond to reality. 

Speaking during a press conference, he called for anyone who was “halfway competent on the economy (I don’t want bullshitters)” to explain how the agreed rules would create “space for the investment we need”. 

“Absolute bullshit,” was his overall analysis, describing such a result during his last plenary after 15 years in the parliament as “heartbreaking”, and accused his fellow MEPs as guilty of a “dereliction of duty”.  

Non-profit Greenpeace came to a similar conclusion, saying the parliament had voted in favour of debt-reduction rules that would “force many EU governments to take austerity measures and limit their ability to borrow to finance essential climate, environmental and social policies”.

“By choosing austerity, Europe’s politicians are choosing climate chaos and nature destruction,” said Greenpeace EU sustainable finance campaigner Ariadna Rodrigo in a statement.

Not possible to please everyone

Ahead of tomorrow’s vote in parliament on reforms to the Common Agricultural Policy, which are being hotly contested by green groups and green MEPs as anti-environmental, and largely unhelpful for farmers dealing with the impacts of climate change, Lamberts commented that “change is a must; the status quo is not an option”.

He urged MEPs to consider that it was not possible, in his view, to please family farmers, dairy farms and multinationals like Lactalis, the French multinational dairy, or Avril, the French agro-industrial group.

By choosing austerity, Europe’s politicians are choosing climate chaos and nature destruction

Ariadna Rodrigo, Greenpeace

The farming unions representing the biggest farms have pushed for a rollback of environmental measures under the CAP, while many smaller farms have expressed support for mandatory nature and biodiversity measures.

“It is either or, you have to pick your side,” said Lamberts. “You can’t protect family farms and protect those who screw them.”

Ecodesign becomes the norm

Campaigners were more positive about the parliament’s adoption of rules aimed at helping consumers repair goods more easily, make products last longer and to make ecodesign the norm for products sold in the EU.

“The new rules will put pressure on producers to make high-quality and repairable products,” said Monique Goyens, director-general at the European consumer organisation BEUC. “This will mark the closure of the chapter on impossible-to-fix products that break too quickly.”

Under the rules, manufacturers will have to provide “timely and cost-effective” repair services and inform consumers about their rights to repair. Goods repaired under warranty will benefit from an additional one-year extension of a legal guarantee and after a guarantee has expired, manufacturers will still be required to repair common household products, such as washing machines, vacuum cleaners or smartphones.

After being formally adopted by Council and the “right to repair” has entered into force, countries will have two years to transpose it into law.

EU votes to end forced labour

MEPs have also voted overwhelmingly in favour of a regulation aimed at ending the sale, import and export of goods made using forced labour.

Once formally adopted by the European Council, the regulation will apply to all goods sold in the EU, including those sold via online marketplaces.

Member states and the commission will be able to investigate suspicious goods, supply chains and manufacturers, and any products found to have been made using forced labour will be banned from being sold in the EU. Manufacturers of banned goods will have to withdraw their products from the EU market and non-compliant companies could face fines.

A service from the Financial Times