The European Council will meet in Brussels tomorrow and Friday.
As is traditional at our spring meeting, economic policy matters will be at the top the agenda.
This will not be a crisis meeting, like so many in recent times. There is now a degree of stability in the markets. However, as I have said before, as leaders we must not let this lead to complacency or a loss of momentum. Rather we must make every effort to use this vital opportunity to underpin stability and to drive forward the reforms that will deliver growth and jobs.
That is the message I will bring to the meeting.
I will advocate that we place a firm focus on implementation of the many and varied measures which we have already agreed – implementation in terms of the economic surveillance involved with the European Semester; implementation of our structural reforms and consolidation efforts; implementation of the Compact for Growth and Jobs; implementation of our economic governance framework; implementation on what we have agreed on addressing unemployment, completing the Single Market and introducing smarter regulation; and critically, implementation of banking union.
This meeting must be about implementation, implementation, implementation.
Ceann Comhairle,
The Union is facing a credibility test - we have to show our people that we are capable of standing by what we have agreed, and of delivering what we have promised
Before I say more about the European Council, it might be useful to the House if I updated it on progress on the Multi-annual Financial Framework (MFF), even though it is not on our agenda on this occasion.
Discussions at the European Council will be opened, as is usual, by an address from the President of the European Parliament. He will have come from this week's Plenary meeting of the Parliament which will express its view on the agreement on the MFF reached by the European Council in February.
There is a general expectation that the Parliament will vote in favour of a Resolution calling on its negotiators to advance some of the issues of greatest importance to the Parliament - flexibility, a mid-term review, own resources - in the negotiations with the Council which Ireland, as Presidency, will lead.
I expect that President Schulz will set out the Parliament's view in clear and forthright terms - that is as it should be. In my meetings with him, I have reassured him that while our role is to represent the Council in the discussions ahead, we will work in good faith with him and his team in the interests of securing an agreement. This is very much in the best interests of the Union and all its institutions.
To better understand the Parliament's position, I plan to meet with President Schulz and President Barroso in the margins of this week's meeting. It is important that we keep momentum up.
While the agreement reached at the European Council last month was an important achievement, there cannot be an MFF without the assent of the Parliament. That is what we are working to secure.
I look forward to keeping the House informed as we proceed.
Ceann Comhairle,
As I have mentioned, this week’s meeting of the European Council will conclude the first phase of European Semester 2013.
The key output in this regard will be guidance to Member States on the preparation of Member States’ Stability Programme Updates, under the Stability and Growth Pact; and National Reform Programmes, under the Europe 2020 Strategy.
The European Semester process provides us with a basis for developing a shared appreciation of the priorities for action at both EU and national levels, as we seek to return to a path of sustainable and job-creating growth.
The main EU-level focus is on supporting the development and implementation of our jointly agreed priorities. While the main focus at Member State level is on restoring competitiveness and bringing about a stronger alignment of budget priorities, employment policies and structural reforms.
The effective management of the processes involved in the 2013 European Semester is an important priority for our Presidency of the Council.
The European Council this week will reinforce strongly the five headline priorities of the Annual Growth Survey, including in light of the Presidency Synthesis Report, which was presented by the Tánaiste to the General Affairs Council in Brussels on Monday of this week.
This Synthesis Report reviews discussions on the Annual Growth Survey across various formations of the Council and is firmly supportive of the Annual Growth Survey’s orientations for actions by Member States supporting competitiveness, growth and jobs.
This means:
- pursuing differentiated, growth-friendly fiscal consolidation;
- restoring normal lending to the economy;
- promoting growth and competitiveness for now and into the future;
- tackling unemployment and the social consequences of - the crisis; and
- modernising public administration.
It is critical that we maintain the momentum behind national-level reforms in these areas, underpinned by the goals of the Europe 2020 Strategy: supporting growth that is smart, sustainable and inclusive.
I expect that our discussions in Brussels will also be informed by the recent agreement by EPSCO Ministers on the principles of the Youth Guarantee. Getting consensus here was an important Presidency achievement.
While we work to put in place conditions necessary to support a general recovery in economic activity, we must also ensure responses from our education and training systems that are effective and appropriate to changing labour market conditions. This means supporting employability, including through new partnerships with the workplace.
There are currently 7.5 million young people across Europe who are not in employment, education or training. This represents almost 13 per cent of our fellow Europeans, aged between 15 and 24. I continue to believe that this is simply unacceptably high, and that we must act urgently. It has been clearly shown that youth unemployment can have lifelong effects. That is why we need to grapple with this challenge now through the rapid implementation of the Youth Guarantee as a key vehicle for mobilising necessary supports in this area. The Youth Guarantee is but one step towards addressing this problem, and I intend to insist that we build on this first step.
The overall objective of the Guarantee schemes is to provide Europe's youth with better prospects for their future by ensuring that supports are available to them to enter the labour market. While acknowledging that different Member States face very different implementation issues, I expect that progress will be supported by the €6 billion Youth Employment Initiative endorsed by the last European Council in February as part of the agreement on a new MFF.
I look forward also to co-chairing the Tripartite Social Summit tomorrow morning in Brussels. This is an important meeting with Social Partners at EU level, and will provide a welcome opportunity to discuss with representatives of trades unions and of business, the central issues in meeting the challenges of recovery. We will also exchange views on the social dimension of EMU, including social dialogue.
Ceann Comhairle,
This week’s European Council will also take stock of progress implementing the Compact for Growth and Jobs. This means, in particular, EU-level actions that will support the more country-specific orientations of the European Semester process.
Our Presidency results, in pressing ahead with the Single Market, will directly contribute to this debate.
As Presidency, we are prioritising agreement on the key Single Market Act I files that are ripe for delivery. We regard as essential priorities, key files such as accounting, professional qualifications, public procurement, posting of workers and e-identification/e-signature. At the same time we are aiming for as much progress as possible on key Single Market Act II files, as these are published over coming months. I look forward to this week’s meeting of leaders highlighting progress on the Single Market, as a concrete means of driving growth and job creation. Importantly, this year for the first time, we will have the monitoring of Single Market happening within the framework of the European Semester process. This is an important further step.
I expect that we will also look at the idea of smart regulation, with a view to a reduction in the overall burden of regulation, particularly on SMEs, which lie at the heart of domestic demand and sustainable job creation.
The financing needs of the real economy are a further crucial focus in terms of EU-level actions supporting growth and jobs. This means restoring normal lending conditions and unlocking productive and growth-enhancing investments. To this end, I expect the European Investment Bank (EIB) will continue to play a crucial role, especially as with the recent increase of €10 billion in the EIB’s capital, this will allow the Bank to lend an extra €60 billion to support jobs and growth.
This week’s European Council will take stock of the on-going work on the strengthening of our Economic and Monetary Union (EMU) which President Van Rompuy was tasked with following up on by leaders in December.
President Van Rompuy and his office are conducting a process of broad consultation with a view to him presenting a ‘road map’ to the June European Council. As Presidency, we are cooperating closely with President Van Rompuy in this work, including through the facilitation of discussion among Ministers across a range of relevant formations of the Council.
It is undoubtedly true that as we take further steps to strengthen economic governance and EMU more generally, these will certainly need to be accompanied by steps aimed at strengthening democratic accountability and legitimacy. To ignore this issue, or to under-estimate its importance, would weaken the exercise. But we must also be careful to ensure that as we move ahead, we do so on the basis of recognised value added. I do not believe in change for change’s sake. We have achieved a lot to date, let’s put that in place before we move ahead. And even more importantly, we must keep our people with us as we strengthen EMU. The European Council will return to these issues for a full discussion at our meeting in June.
Ceann Comhairle,
This week’s Summit meeting will again address the vitally important issue of an integrated financial framework – or banking union.
The Irish Presidency is giving top priority to progressing the legislative files in this area.
I am pleased to say that the Irish Presidency won broad political support at Ecofin earlier this month for the compromise package reached with the European Parliament on the Capital Requirements Directive (CRD IV) and we will now work to iron out the remaining technical issues, with a view to reaching a final agreement by the end of this month.
On the Single Supervisory Mechanism (SSM), we are working intensively with the Parliament, with a view to finalising the legislative process within the next few weeks.
We are also working hard also to see the operational framework for the direct recapitalisation of banks by the ESM, finalised by the end of our Presidency.
Nationally, of course, this issue takes on particular significance for Ireland, given that it will also address the issue of the definition of legacy assets.
As Presidency, we are also striving to ensure that agreement is reached on the Bank Recovery and Resolution Directive and on the Deposit Guarantee Scheme Directive by the end of June. We look forward also to the submission by the Commission of a legislative proposal on a Single Resolution Mechanism, by this summer.
The agreement last June to break the link between sovereign and banking debt was a watershed moment in the crisis. In December, we set ourselves ambitious timelines for achieving the various pieces of legislation necessary to underpin the commitment.
We now need to keep the pressure up for delivery. We cannot afford any loss of momentum.
Tomorrow night, following the European Council’s working dinner session on the European Semester and economic issues, the seventeen euro area leaders will convene for a Euro Area Summit meeting.
ECB President Draghi will introduce the discussion on developments in the euro area. As well as considering those on-going challenges, leaders will also adopt a set of rules of procedure for future Euro Area Summits.
We will complete our discussions of economic matters on Thursday evening. On Friday, the European Council will discuss the EU’s strategic relationships, especially our partnership with Russia.
EU Foreign Ministers, including the Tánaiste, took part in a broad-ranging discussion on the relationship with Russia at the Foreign Affairs Council on Monday of this week and the key elements of that will inform our discussion.
This is a timely discussion as there is a shared understanding in the EU of the need to fashion a stronger, more coherent approach to Russia, to the benefit of both sides.
One of the key themes running through recent discussions on Russia has been the extent to which the EU and Russia work together, both in terms of mutual trade and investment; in our energy relations; and as partners in international fora, in the pursuit of peace and security.
The simple facts are that the EU is Russia’s largest trading partner and Russia is the EU’s largest energy supplier.
The relationship has been further enhanced by a complex institutional framework enabling both sides to engage in regular political dialogue – indeed Russia is the only partner with which the EU holds a Summit in each Presidency. The EU and Russia also cooperate effectively on critical foreign policy issues, including Afghanistan, counter-terrorism and the Middle East Peace Process.
However, as in any important relationship, there are issues where we see eye to eye and issues where our interests, and indeed the values that define those interests, differ.
The EU and its Member States have in the past year expressed regret and concern about internal developments in Russia that have challenged the ambitions of those who would wish to see a further growth in political pluralism, and at the level of the individual, in personal freedom and freedom of expression. These concerns are also likely to be discussed at the European Council, including the challenge of how best to communicate these concerns to our Russian partners in a frank and constructive manner.
Ceann Comhairle,
I intend to again play a fully engaged and constructive part – both as Presidency of the Council and nationally – during the deliberations on each of the agenda points at this week’s Summit meeting.
As I said at the outset, a push on implementation will be an important outcome from this week’s meeting.
I will, of course, report back to the House on this meeting of the European Council.