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~~PA_Legam~~

ORDINARY LEGISLATIVE procedure

~~SHORT JUSTIFICATION~~

Follow up to the European Parliament legislative resolution on the proposal for a regulation of the European Parliament and of the Council on the effective coordination of economic policies and multilateral budgetary surveillance and repealing Council Regulation (EC) No 1466/97

~~AMENDMENT~~

1. Rapporteur: Markus FERBER (EPP/ DE), Margarida MARQUES (S&D / PT)

~~The Committee on Employment and Social Affairs calls on the Committee on Economic and Monetary Affairs, as the committee responsible, to take the following into account:~~

2. Reference numbers: 2023/0138 (COD) / A9-0439/2023 / P9_TA(2024)0311

~~Amendment 1~~

3. Date of adoption of the resolution: 23 April 2024

~~Proposal for a regulation~~

4. Legal basis: Article 121(6) of the Treaty on the Functioning of the European Union

~~Recital 5~~

5. Competent Parliamentary Committee: Committee on Economic and Monetary Affairs (ECON)

~~Text proposed by the Commission~~

6. Commission's position: accepts all amendments.

~~Amendment~~

(5) The economic governance framework of the Union should be adapted to better take into account the growing heterogeneity of fiscal positions, public debt challenges and other vulnerabilities across Member States. The strong policy response to the COVID-19 pandemic proved highly effective in mitigating the economic and social damage of the crisis, but the crisis resulted in a significant increase in public- and private-sector debt ratios, underscoring the importance of reducing debt ratios to prudent levels in a gradual, sustained and growth-friendly manner and addressing macroeconomic imbalances, while paying due attention to employment and social objectives. At the same time, the economic governance framework of the Union should be adapted to help address the medium- and long-term challenges facing the Union including achieving a fair digital and green transition, including the Climate Law22 , ensuring energy security, open strategic autonomy, addressing demographic change, strengthening social and economic resilience and implementing the strategic compass for security and defence, all of which requires reforms and sustained high levels of investment in the years to come.

(5) The economic governance framework of the Union should be adapted to better take into account the growing heterogeneity of fiscal positions, public debt challenges, social considerations and other vulnerabilities across Member States. The strong policy response to the COVID-19 pandemic proved highly effective in mitigating the economic and social damage of the crisis, but the crisis resulted in a significant increase in public- and private-sector debt ratios, underscoring the importance of reducing debt ratios to prudent levels in a gradual, sustained, growth-friendly and inclusive manner and addressing macroeconomic imbalances as well as supporting upward social convergence, paying due attention to quality employment and social objectives. At the same time, the economic governance framework of the Union should be adapted to help address the medium- and long-term challenges facing the Union including achieving a fair digital and green transition, including the Climate Law22 , including the implementation of the European Pillar of Social Rights, ensuring energy security, open strategic autonomy, addressing demographic change, strengthening social and economic resilience, achieving upward social convergence and implementing the strategic compass for security and defence, all of which requires reforms and sustained high levels of investment in the years to come. It should therefore take into account the high economic, ecological and social risks caused by under-investment, including labour shortage, infrastructure deficiencies and a lack of progress in reaching agreed decarbonisation targets in a socially just way.

~~__________________~~

22 The European Climate Law sets a Union-wide climate neutrality objective by 2050 and requires Union institutions and Member States to progress in enhancing adaptive capacity, requiring significant public investment to reduce the negative socio-economic impacts of climate change on the EU and its Member States, including negative impacts on growth and fiscal sustainability.

~~Or. en~~

~~Amendment 2~~

~~Proposal for a regulation~~

~~Recital 7~~

~~Text proposed by the Commission~~

~~Amendment~~

(7) The multilateral surveillance procedure set out in Article 121(2), (3) and (4) and Article 148(4) TFEU should monitor in accordance with more detailed rules the full range of economic, employment and social developments in each of the Member States and in the Union, including progress towards the national targets, linked to the headline targets and their main and secondary indicators of the European Pillar of Social Rights. That includes the detection of macroeconomic imbalances and the prevention and correction of excessive imbalances as set out in Regulations (EU) No 1174/201123 and (EU) No 1176/201124 of the European Parliament and of the Council. For the monitoring of such economic, employment and social convergence developments, Member States should present information in the form of medium- term fiscal-structural plans. For the monitoring of the social developments, a surveillance mechanism that monitors social convergence risks should be established.

~~__________________~~

23 Regulation (EU) No 1174/2011 of the European Parliament and of the Council of 16 November 2011 on enforcement measures to correct excessive macroeconomic imbalances in the euro area (OJ L 306, 23.11.2011, p. 8).

~~24 Regulation (EU) No 1176/2011 of the European Parliament and of the Council of 16 November 2011 on the prevention and correction of macroeconomic imbalances (OJ L 306, 23.11.2011, p. 25).~~

~~Or. en~~

~~Amendment 3~~

~~Proposal for a regulation~~

~~Recital 8~~

~~Text proposed by the Commission~~

~~Amendment~~

(8) Detailed rules should therefore be laid down regarding the content, submission, assessment and monitoring of the national medium-term fiscal-structural plans, in order to promote debt sustainability and sustainable and inclusive growth in the Member States and prevent the occurrence of excessive government deficits through medium-term planning.

(8) Detailed rules should therefore be laid down regarding the content, submission, assessment and monitoring of the national medium-term fiscal-structural plans, in order to promote debt sustainability, sustainable and inclusive growth and upward social convergence in the Member States and prevent the occurrence of excessive government deficits through medium-term planning.

~~Or. en~~

~~Amendment 4~~

~~Proposal for a regulation~~

~~Recital 9~~

~~Text proposed by the Commission~~

~~Amendment~~

(9) National medium-term fiscal-structural plans should bring together the fiscal, structural reforms and investment commitments of each Member State and these plans should be the cornerstone of the economic governance framework of the Union. Each Member State should present a medium-term plan that sets out its fiscal trajectory as well as priority public investment and reform commitments that together ensure sustained and gradual debt reduction and sustainable and inclusive growth, avoiding a pro-cyclical fiscal policy, as well as broader reform and investment commitments, including in relation to the green and digital transitions, social and economic resilience and the implementation of the European Pillar of Social Rights. During the lifetime of the Recovery and Resilience Facility25 , commitments undertaken in the national Recovery and Resilience Plans should be duly taken into account.

(9) National medium-term fiscal-structural plans should bring together the fiscal, structural reforms and investment commitments of each Member State and these plans should be the cornerstone of the economic and social governance framework of the Union. Each Member State should present a medium-term plan that sets out its fiscal trajectory as well as priority public investment and reform commitments that together ensure sustained and gradual debt reduction, sustainable and inclusive growth and upward social convergence, avoiding a pro-cyclical fiscal policy, as well as broader reform and investment commitments, including in relation to the green and digital transitions, social and economic resilience, upward social convergence and the implementation of the European Pillar of Social Rights. During the lifetime of the Recovery and Resilience Facility25, commitments undertaken in the national Recovery and Resilience Plans should be duly taken into account.

~~__________________~~

~~25 Regulation (EU) 2021/241 of the European Parliament and of the Council of 12 February 2021 establishing the Recovery and Resilience Facility (OJ L 57, 18.2.2021, p. 17).~~

~~Or. en~~

~~Amendment 5~~

~~Proposal for a regulation~~

~~Recital 12~~

~~Text proposed by the Commission~~

~~Amendment~~

(12) In order to simplify the Union fiscal framework and increase transparency, a single operational indicator anchored in debt sustainability should serve as a basis for setting the fiscal path and carrying out annual fiscal surveillance for each Member State. That single operational indicator should be based on nationally financed net primary expenditure, that is to say expenditure net of discretionary revenue measures and excluding interest expenditure as well as cyclical unemployment expenditure and expenditure on Union programmes fully matched by revenue from Union funds. This indicator allows for macro-economic stabilisation as it is not affected by the operation of automatic stabilisers, including revenue and expenditure fluctuations outside the direct control of the government.

(12) In order to simplify the Union fiscal framework and increase transparency, a single operational indicator anchored in debt sustainability should serve as a basis for setting the fiscal path and carrying out annual fiscal surveillance for each Member State. That single operational indicator should be based on nationally financed net primary expenditure, that is to say expenditure net of discretionary revenue measures and excluding interest expenditure as well as cyclical unemployment and short time work schemes expenditure and expenditure on Union programmes fully matched by revenue from Union funds. This indicator allows for macro-economic stabilisation as it is not affected by the operation of automatic stabilisers, including revenue and expenditure fluctuations outside the direct control of the government.

~~Or. en~~

~~Amendment 6~~

~~Proposal for a regulation~~

~~Recital 13~~

~~Text proposed by the Commission~~

~~Amendment~~

(13) To provide guidance to the Member States in the drafting of their medium-term fiscal-structural plan, the Commission should put forward a technical trajectory based on the minimum fiscal adjustment that brings the debt trajectory of the Member State on a plausibly downward path or maintains debt at a prudent level, while also taking into account the investment needs of Member States to achieve the common priorities of the Union. It should also ensure that the public debt ratio at the end of the planning horizon declines below its level in the year before the start of the technical trajectory. The sustainability of that debt reduction should result from appropriate fiscal policies, trajectory. The sustainability of that debt reduction should result from appropriate fiscal policies, which do no significant harm to the achievement of the common priorities of the Union.

~~Or. en~~

~~Amendment 7~~

~~Proposal for a regulation~~

~~Recital 16~~

~~Text proposed by the Commission~~

~~Amendment~~

(16) Each national medium-term fiscal-structural plan should mention its status in the context of national procedures, notably whether the plan was presented to the national parliament and whether there has been parliamentary approval of the plan. The national medium-term fiscal-structural plan should also indicate whether the national parliament had the opportunity to discuss the Council recommendation on the previous plan and, if relevant, any other Council recommendation or decision, or any Commission warning.

(16) Each national medium-term fiscal-structural plan should mention its status in the context of national procedures, notably whether the plan was presented to the national parliament and social partners and whether there has been parliamentary approval of the plan. The national medium-term fiscal-structural plan should also indicate whether the national parliament had the opportunity to discuss the Council recommendation on the previous plan and, if relevant, any other Council recommendation or decision, or any Commission warning.

~~Or. en~~

~~Amendment 8~~

~~Proposal for a regulation~~

~~Recital 16 a (new)~~

~~Text proposed by the Commission~~

~~Amendment~~

(16 a) Member States should ensure that social partners are consulted when preparing the medium term fiscal-structural plans and are given the possibility to provide their input at early stage, especially in those aspects related to employment policies or that can have an impact on employment.

~~Or. en~~

~~Amendment 9~~

~~Proposal for a regulation~~

~~Recital 18~~

~~Text proposed by the Commission~~

~~Amendment~~

(18) Since Member States could face additional costs at the end of their medium-term fiscal-structural plan such as ageing costs or an unfavourable interest-growth differential, they should ensure that the headline balance at the end of the adjustment period will be sufficient to ensure that the deficit durably stays below the 3% of GDP reference value.

(18) Since Member States could face additional costs at the end of their medium-term fiscal-structural plan, they should ensure that the headline balance at the end of the adjustment period will be sufficient to ensure that the deficit durably stays below the 3% of GDP reference value.

~~Or. en~~

~~Amendment 10~~

~~Proposal for a regulation~~

~~Recital 20~~

~~Text proposed by the Commission~~

~~Amendment~~

(20) The Commission’s assessment of the national medium-term fiscal-structural plans should examine in particular the plausibility of the macroeconomic and fiscal assumptions, to the extent that they depart from those underlying the technical trajectory. In particular, the debt projections at unchanged policy to be included in the plan should be consistent and comparable with the Commission projections.

(20) The Commission’s assessment of the national medium-term fiscal-structural plans should examine in particular the plausibility of the macroeconomic and fiscal assumptions, to the extent that they depart from those underlying the technical trajectory, while ensuring the achievement of the objectives set out by the common priorities. In particular, the debt projections at unchanged policy to be included in the plan should be consistent and comparable with the Commission projections.

~~Or. en~~

~~Amendment 11~~

~~Proposal for a regulation~~

~~Recital 22~~

~~Text proposed by the Commission~~

~~Amendment~~

(22) To ensure a more gradual debt reduction, the adjustment period can be extended by a maximum of 3 years if the Member State underpins its medium-term fiscal-structural plan with a set of verifiable and time-bound reforms and investment that, taken altogether: are growth-enhancing, support fiscal sustainability, address the common priorities of the Union, address relevant country-specific recommendations addressed to the Member State under the European Semester, and address the country-specific investment priorities without leading to cuts in other nationally financed public investment over the adjustment period in order to ensure a macroeconomic impact of investments and avoid crowding out of other investment priorities.

(22) To ensure a more gradual debt reduction, the adjustment period can be extended by a maximum of 3 years if the Member State underpins its medium-term fiscal-structural plan with a set of verifiable and time-bound reforms and investment that, taken altogether: enhance sustainable and inclusive growth, promote upward social convergence, support fiscal sustainability, address the common priorities of the Union, address relevant country-specific recommendations addressed to the Member State under the European Semester, and address the country-specific investment priorities without leading to cuts in other nationally financed public investment, including social investments, over the adjustment period in order to ensure a macroeconomic impact of investments and avoid crowding out of other investment priorities.

~~Or. en~~

~~Amendment 12~~

~~Proposal for a regulation~~

~~Recital 23~~

~~Text proposed by the Commission~~

~~Amendment~~

(23) With a view to ensuring an equitable and transparent process, the reform and investment commitments should be assessed using a common Union framework. During the lifetime of the Recovery and Resilience Facility, commitments in the national Recovery and Resilience Plans can be considered in the assessment of the request for an extension of the adjustment period, where applicable. The set of reforms and investments underpinning an extension of the fiscal adjustment path period should be commensurate with the degree of public debt challenges as established in the most recent update of the Debt Sustainability Monitor and challenges to medium-term growth in the Member State. For Member States where public debt challenges are linked to significant challenges to medium-term growth, the set of reforms and investments is expected to also address bottlenecks to medium-term growth.

(23) With a view to ensuring an equitable and transparent process, the reform and investment commitments should be assessed using a common Union framework. During the lifetime of the Recovery and Resilience Facility, commitments in the national Recovery and Resilience Plans can be considered in the assessment of the request for an extension of the adjustment period, where applicable. The set of reforms and investments underpinning an extension of the fiscal adjustment path period should be commensurate with the degree of public debt challenges as established in the most recent update of the Debt Sustainability Monitor in combination with the social divergence risks as established in the most recent updated of their monitoring. For Member States where public debt challenges are linked to significant challenges to medium-term growth, the set of reforms and investments is expected to also address bottlenecks to medium-term growth.

~~Or. en~~

~~Amendment 13~~

~~Proposal for a regulation~~

~~Recital 24~~

~~Text proposed by the Commission~~

~~Amendment~~

(24) The set of reform and investment commitments put forward in the national medium-term fiscal-structural plans should be aligned with common priorities of the Union. That set of reform and investment commitments should also be consistent with the implementation of the national strategies put forward by the Member State concerned to address the relevant Union priorities. Where relevant, during the lifetime of the Recovery and Resilience Facility, cross-references to the Recovery and Resilience Plans should be made to ensure policy consistency.

(24) The set of reform and investment commitments put forward in the national medium-term fiscal-structural plans should ensure the achievement of the objectives set out by the common priorities of the Union. That set of reform and investment commitments should also be consistent with the implementation of the national strategies put forward by the Member State concerned to address the relevant Union priorities. Where relevant, during the lifetime of the Recovery and Resilience Facility, cross-references to the Recovery and Resilience Plans should be made to ensure policy consistency.

~~Or. en~~

~~Amendment 14~~

~~Proposal for a regulation~~

~~Recital 25~~

~~Text proposed by the Commission~~

~~Amendment~~

(25) Where the verifiable and time-bound set of reform and investment commitments underpinning the more gradual net expenditure path is not met within the specified deadline, the Council, on a recommendation from the Commission, can recommend that adjustment be steepened, that is to say by shortening the extension of the net expenditure path.

~~Or. en~~

~~Amendment 15~~

~~Proposal for a regulation~~

~~Recital 27~~

~~Text proposed by the Commission~~

~~Amendment~~

(27) Independent fiscal institutions have proven their capacity to foster fiscal discipline and strengthen the credibility of Member States’ public finances. In order to enhance national ownership, the role of independent fiscal institutions, traditionally mandated to monitor compliance with the national framework, should be expanded to the economic governance framework of the Union.

(27) Independent fiscal institutions have proven their capacity to foster fiscal discipline and strengthen the credibility of Member States’ public finances. In order to enhance national ownership, independent fiscal institutions, traditionally mandated to monitor compliance with the national framework, should also take into account the social developments and incorporate experts in the social field.

~~Or. en~~

~~Amendment 16~~

~~Proposal for a regulation~~

~~Recital 29 a (new)~~

~~Text proposed by the Commission~~

~~Amendment~~

(29 a) Particular attention should be also given to significant risks of social divergence deriving from fiscal adjustment policy choices in the national medium term plans. Therefore, it is appropriate to complement the multilateral surveillance procedure set out in Article 121(3) and (4) TFEU with an early warning system whereby the Commission, pursuing article 9 of the TFEU, alerts a Member State at an early stage about the need to take the necessary corrective action in order to prevent social divergence risks.

~~Or. en~~

~~Amendment 17~~

~~Proposal for a regulation~~

~~Recital 32~~

~~Text proposed by the Commission~~

~~Amendment~~

(32) This Regulation is part of a package together with Council Directive [XXX amending 2011/85/EU] and Council Regulation [XXX amending Council Regulation (EC) No 1467/97]. Together, they establish a reformed Union economic governance framework that incorporates into Union law the substance of Title III ‘Fiscal Compact’ of the Treaty on Stability, Coordination and Governance (TSCG) in the Economic and Monetary Union27 , in accordance with Article 16 thereof. By building on the experience with the implementation of the TSCG by the Member States, the proposed legislative package retains the Fiscal Compact’s medium-term orientation as a tool to achieve budgetary discipline and growth promotion. The package includes a strengthened country-specific dimension aimed at enhancing national ownership, including by means of a stronger role for Independent Fiscal Institutions, which draws essentially on the Fiscal Compact’s common principles proposed by the Commission28 in accordance with Article 3(2) of the TSCG. The analysis of expenditure net of discretionary revenue measures for the overall assessment of compliance required by the Fiscal Compact is set out in this Regulation. As in the Fiscal Compact, temporary deviations from the medium-term plan are allowed only in exceptional circumstances in this Regulation. In a similar vein to the Fiscal Compact, in case of significant deviations from the medium-term plan, measures should be implemented to correct the deviations over a defined period of time. The package strengthens fiscal surveillance and enforcement procedures to deliver on the commitment of promoting sound and sustainable public finances and sustainable and inclusive growth. The economic governance framework reform, thus, retains the fundamental objectives of budgetary discipline and debt sustainability set out in the TSCG.

(32) This Regulation is part of a package together with Council Directive [XXX amending 2011/85/EU] and Council Regulation [XXX amending Council Regulation (EC) No 1467/97]. Together, they establish a reformed Union economic governance framework that incorporates into Union law the substance of Title III ‘Fiscal Compact’ of the Treaty on Stability, Coordination and Governance (TSCG) in the Economic and Monetary Union27 , in accordance with Article 16 thereof. By building on the experience with the implementation of the TSCG by the Member States, the proposed legislative package retains the Fiscal Compact’s medium-term orientation as a tool to achieve budgetary discipline and growth promotion. The package includes a strengthened country-specific dimension aimed at enhancing national ownership, including by means of a role for Independent Fiscal Institutions, which draws essentially on the Fiscal Compact’s common principles proposed by the Commission28 in accordance with Article 3(2) of the TSCG. The Independent Fiscal Institutions should incorporate social experts and also provide an assessment of the social impact of fiscal policy choices. The analysis of expenditure net of discretionary revenue measures for the overall assessment of compliance required by the Fiscal Compact is set out in this Regulation. As in the Fiscal Compact, temporary deviations from the medium-term plan are allowed only in exceptional circumstances in this Regulation. In a similar vein to the Fiscal Compact, in case of significant deviations from the medium-term plan, measures should be implemented to correct the deviations over a defined period of time. The package strengthens fiscal surveillance and enforcement procedures to deliver on the commitment of promoting sound and sustainable public finances and sustainable and inclusive growth. The economic governance framework reform, thus, retains the fundamental objectives of budgetary discipline and debt sustainability set out in the TSCG.

~~__________________~~

~~27 Treaty on Stability, Coordination and Governance in the Economic and Monetary Union of 2 March 2012.~~

~~28 Communication COM(2012) 342 final of 20 June 2012 from the Commission ‘Common principles on national fiscal correction mechanisms.~~

~~Or. en~~

~~Amendment 18~~

~~Proposal for a regulation~~

~~Recital 33~~

~~Text proposed by the Commission~~

~~Amendment~~

(33) In order to ensure effective implementation and appropriate monitoring of this Regulation, the power to adopt acts in accordance with Article 290 TFEU should be delegated to the Commission in respect of: the information to be provided by Member States in their medium-term fiscal-structural plans, the information to be provided by Member States in their annual progress reports, the functioning of the control account, the methodology to assess plausibility by the Commission, drawing up of the list of common Union priorities and the assessment framework for the set of reform and investment commitments underpinning an extension of the fiscal adjustment period. It is of particular importance that the Commission carries out appropriate consultations during its preparatory work, including at expert level, and that those consultations be conducted in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making29 . In particular, to ensure equal participation in the preparation of delegated acts, the European Parliament and the Council receive all documents at the same time as Member States' experts, and their experts systematically have access to meetings of Commission expert groups dealing with the preparation of delegated acts.

(33) In order to ensure effective implementation and appropriate monitoring of this Regulation, the power to adopt acts in accordance with Article 290 TFEU should be delegated to the Commission in respect of: the information to be provided by Member States in their medium- term fiscal-structural plans, the information to be provided by Member States in their annual progress reports, the functioning of the control account, the methodology to assess plausibility by the Commission, It is of particular importance that the Commission carries out appropriate consultations during its preparatory work, including at expert level, and that those consultations be conducted in accordance with the principles laid down in the Interinstitutional Agreement of 13 April 2016 on Better Law-Making29. In particular, to ensure equal participation in the preparation of delegated acts, the European Parliament and the Council receive all documents at the same time as Member States' experts, and their experts systematically have access to meetings of Commission expert groups dealing with the preparation of delegated acts.

~~__________________~~

~~29 OJ L 123, 12.5.2016, p. 1.~~

~~Or. en~~

~~Amendment 19~~

~~Proposal for a regulation~~

~~Article 1 – paragraph 1~~

~~Text proposed by the Commission~~

~~Amendment~~

~~This Regulation sets out rules ensuring effective coordination of economic policies of the Member States, thereby supporting the achievement of the Union’s objectives for growth and employment.~~

This Regulation sets out rules ensuring effective coordination of economic policies of the Member States, thereby supporting the achievement of the Union’s objectives for sustainable and inclusive growth and quality employment according to the common Union priorities.

~~Or. en~~

~~Amendment 20~~

~~Proposal for a regulation~~

~~Article 1 – paragraph 2~~

~~Text proposed by the Commission~~

~~Amendment~~

It lays down detailed rules concerning the content, submission, assessment and monitoring of national medium-term fiscal-structural plans as part of multilateral budgetary surveillance by the Council and the Commission so as to promote debt sustainability and sustainable and inclusive growth in the Member States and prevent the occurrence of excessive government deficits, by medium-term planning.

It lays down detailed rules concerning the content, submission, assessment and monitoring of national medium-term fiscal-structural plans in line with the economic, social and sustainability objectives of the EU as part of economic and multilateral budgetary surveillance by the Council and the Commission so as to promote debt sustainability, sustainable and inclusive growth and upward social convergence in the Member States and prevent the occurrence of excessive government deficits, by medium-term planning, while ensuring the necessary economic and social investments.

~~Or. en~~

~~Amendment 21~~

~~Proposal for a regulation~~

~~Article 1 – paragraph 2 a (new)~~

~~Text proposed by the Commission~~

~~Amendment~~

~~The common priorities of the Union are:~~

~~(a) The European Green Deal, including the transition to climate neutrality by 2050 and the translation at national level through the National Energy and Climate Plans;~~

~~(b) The European Pillar of Social Rights including the related targets on employment, skills and poverty reduction by 2030;~~

~~(c) The Digital Decade Policy Programme 2030, and reflected at national level through the National Digital Decade Strategic Roadmaps;~~

~~(d) A Strategic Compass for Security and Defence - For a European Union that protects its citizens, values and interests and contributes to international peace and security.~~

~~Or. en~~

~~Amendment 22~~

~~Proposal for a regulation~~

~~Article 2 – paragraph 1 – point 2~~

~~Text proposed by the Commission~~

~~Amendment~~

(2) ‘net expenditure’ means government expenditure net of interest expenditure, discretionary revenue measures and other budgetary variables outside the control of the government as set out in Annex II, point (a);

(2) ‘net expenditure’ means government expenditure net of interest expenditure, investments needed for the achievement of the implementation of the European Pillar of Social Rights and other budgetary variables outside the control of the government and cyclical elements of unemployment benefit expenditure as set out in Annex II, point (a);

~~Or. en~~

~~Amendment 23~~

~~Proposal for a regulation~~

~~Article 3 – paragraph 1~~

~~Text proposed by the Commission~~

~~Amendment~~

In order to ensure closer coordination of economic policies and sustained convergence of the economic and social performance of the Member States, the Council and the Commission shall conduct multilateral surveillance within the European Semester in accordance with the objectives and requirements set out in the TFEU. Multilateral surveillance shall rely on high quality and independent statistics, produced in accordance with the principles laid down in Regulation (EC) No 223/2009 of the European Parliament and of the Council.

In order to ensure closer coordination of economic and employment policies and sustained upward convergence of the economic and social performance of the Member States as well as the achievement of the common Union priorities, the Council and the Commission shall conduct multilateral surveillance within the European Semester in accordance with the objectives and requirements set out in the TFEU. Multilateral surveillance shall rely on high quality and independent statistics, produced in accordance with the principles laid down in Regulation (EC) No 223/2009 of the European Parliament and of the Council.

~~Or. en~~

~~Amendment 24~~

~~Proposal for a regulation~~

~~Article 3 – paragraph 2 – point a~~

~~Text proposed by the Commission~~

~~Amendment~~

(a) the formulation, and the surveillance of the implementation, of the broad guidelines for the economic policies of the Member States and of the Union in accordance with Article 121(2) TFEU, of country-specific recommendations and of the recommendation on the economic policy of the euro area;

(a) the formulation, and the surveillance of the implementation, of the broad guidelines for the economic, social and sustainability policies of the Member States and of the Union in accordance with Article 121(2) TFEU and of Article 148 TFEU, of country-specific recommendations and of the recommendation on the economic policy of the euro area;

~~Or. en~~

~~Amendment 25~~

~~Proposal for a regulation~~

~~Article 3 – paragraph 2 – point b~~

~~Text proposed by the Commission~~

~~Amendment~~

(b) the formulation, and the surveillance of the implementation, of the employment guidelines that are to be taken into account by Member States in accordance with Article 148(2) TFEU, including the European Pillar of Social Rights and its headline targets, and of the related country-specific recommendations, and of obligations following from current social legislation and in accordance with Article 9 and Article 151 TFEU;

~~Or. en~~

~~Amendment 26~~

~~Proposal for a regulation~~

~~Article 3 – paragraph 2 – point d a (new)~~

~~Text proposed by the Commission~~

~~Amendment~~

~~(da) the surveillance to prevent and correct social imbalances via a common mechanism;~~

~~Or. en~~

~~Amendment 27~~

~~Proposal for a regulation~~

~~Article 4 – paragraph 1~~

~~Text proposed by the Commission~~

~~Amendment~~

1. Where necessary, following the assessment pursuant to this Regulation of the medium-term fiscal-structural plans, the annual progress reports and the socio-economic situation of the Member States concerned, the Council shall, on the basis of recommendations from the Commission, address recommendations to those Member States making full use of the legal instruments provided in Articles 121 and 148 TFEU and related secondary legislation.

~~Or. en~~

~~Amendment 28~~

~~Proposal for a regulation~~

~~Article 4 – paragraph 2~~

~~Text proposed by the Commission~~

~~Amendment~~

2. Member States shall take due account of the broad guidelines for the economic policies of the Member States, of the employment guidelines and of the recommendations referred to in Article 3, second paragraph, points (a) and (b) before taking key decisions in the development of their economic, employment and budgetary policies. Progress shall be monitored by the Commission.

2. Member States shall take due account of the broad guidelines for the economic policies of the Member States, of the employment guidelines and of the recommendations referred to in Article 3, second paragraph, points (a), (b) and (da) before taking key decisions in the development of their economic, employment and budgetary policies. Progress shall be monitored by the Commission.

~~Or. en~~

~~Amendment 29~~

~~Proposal for a regulation~~

~~Article 4 – paragraph 3 – point b a (new)~~

~~Text proposed by the Commission~~

~~Amendment~~

~~(b a) a recommendation by the Council based on a proposal by the Commission pursuant to Articles 9 and 148(4) TFEU or the implementation of the principles of the European Pillar of Social Rights;~~

~~Or. en~~

~~Amendment 30~~

~~Proposal for a regulation~~

~~Article 5 – paragraph 1~~

~~Text proposed by the Commission~~

~~Amendment~~

For each Member State having a public debt above the 60% of GDP reference value or a government deficit above the 3% of GDP reference value, the Commission shall put forward, in a report to the Economic and Financial Committee, a technical trajectory for net expenditure covering a minimum adjustment period of 4 years of the national medium-term fiscal-structural plan, and its possible extension by a maximum of 3 years pursuant to Article 13. The Commission shall make the report public.

For each Member State having a public debt above the 60% of GDP reference value or a government deficit above the 3% of GDP reference value, the Commission shall put forward, in a report to the Economic and Financial Committee, after consultation with relevant social partners, a technical trajectory for net expenditure covering a minimum adjustment period of 4 years of the national medium-term fiscal-structural plan, and its possible extension by a maximum of 3 years pursuant to Article 13. The Commission shall make the report public.

~~Or. en~~

~~Amendment 31~~

~~Proposal for a regulation~~

~~Article 7 – paragraph 1 – point b a (new)~~

~~Text proposed by the Commission~~

~~Amendment~~

~~(b a) social risks forecast and assumptions;~~

~~Or. en~~

~~Amendment 32~~

~~Proposal for a regulation~~

~~Article 10 – paragraph 1 a (new)~~

~~Text proposed by the Commission~~

~~Amendment~~

The European Commission will consult social partners, in timely and effective manner, in order to collect views on the sustainability of the adjustment trajectory, the impact of the reform and investment tool and assess the plausibility of the debt trajectory.

~~Or. en~~

~~Amendment 33~~

~~Proposal for a regulation~~

~~Article 11 – paragraph 1 – subparagraph 2~~

~~Text proposed by the Commission~~

~~Amendment~~

The national medium-term fiscal-structural plan shall also describe the actions of the Member State concerned to address the country-specific recommendations, including those that are relevant for the Macroeconomic Imbalances Procedure, and the warnings by the Commission, where applicable, or the recommendations by the Council, where applicable, made pursuant to Article 121(4) TFEU.

~~Or. en~~

~~Amendment 34~~

~~Proposal for a regulation~~

~~Article 12 – paragraph 1 – point a~~

~~Text proposed by the Commission~~

~~Amendment~~

(a) ensure the fiscal adjustment necessary to put or keep public debt on a plausibly downward path by the end of the adjustment period at the latest, or remain at prudent levels, and to bring and maintain the government deficit below the 3% of GDP reference value over the medium term; when calculating the budget balance, governments should be allowed to integrate a qualified treatment for the social investment linked to the implementation of the principles of the European Pillar of Social Rights, spreading the costs for investment over the lifespan of the investment.

~~Or. en~~

~~Amendment 35~~

~~Proposal for a regulation~~

~~Article 12 – paragraph 1 – point b~~

~~Text proposed by the Commission~~

~~Amendment~~

(b) explain how it will ensure the delivery of investment and reforms responding to the main challenges identified within the European Semester, in the country-specific recommendations, correct the identified macroeconomic imbalances under the Macroeconomic Imbalances Procedure if applicable, and address the common priorities of the Union referred to in Article 1 of this Regulation, including the European Green Deal, European Pillar of Social Rights , including the EU and national targets on employment, education and poverty reduction by 2030, and the Digital Decade while being consistent with the updated National Energy and Climate Plans and the National Digital Decade Roadmaps. In addition, it shall explain how it will ensure consistency with the broad guidelines for the economic policies of the Member States and with the employment guidelines in accordance with Article 121(2) and Article 148(2) TFEU;

~~Or. en~~

~~Amendment 36~~

~~Proposal for a regulation~~

~~Article 12 – paragraph 1 – point d a (new)~~

~~Text proposed by the Commission~~

~~Amendment~~

(d a) explain the consultation process, conducted in accordance with the national legal framework, of local and regional authorities, social partners, civil society organisations, youth organisations and other relevant stakeholders, and how the input of the stakeholders is reflected in the plan and in the implementation process; and

~~Or. en~~

~~Amendment 37~~

~~Proposal for a regulation~~

~~Article 12 – paragraph 1 – point d b (new)~~

~~Text proposed by the Commission~~

~~Amendment~~

~~(d b) ensure that the reforms proposed contribute to achieving the social policy goals as defined in the European Pillar of Social Rights and its action plan.~~

~~Or. en~~

~~Amendment 38~~

~~Proposal for a regulation~~

~~Article 13 – paragraph 2 – subparagraph 1~~

~~Text proposed by the Commission~~

~~Amendment~~

The set of reform and investment commitments underpinning an extension of the adjustment period, shall be commensurate with the degree of public debt challenges and challenges to medium-term growth in the Member State concerned.

The set of reform and investment commitments underpinning an extension of the adjustment period, shall be commensurate with the degree of public debt challenges, challenges to medium-term sustainable growth in the Member State concerned and the challenges for the achievement of the common Union priorities.

~~Or. en~~

~~Amendment 39~~

~~Proposal for a regulation~~

~~Article 13 – paragraph 2 – subparagraph 2 – point i~~

~~Text proposed by the Commission~~

~~Amendment~~

~~(i) be growth enhancing;~~

~~(i) be sustainable growth enhancing;~~

~~Or. en~~

~~Amendment 40~~

~~Proposal for a regulation~~

~~Article 13 – paragraph 2 – subparagraph 2 – point ii a (new)~~

~~Text proposed by the Commission~~

~~Amendment~~

~~(ii a) support upward social convergence;~~

~~Or. en~~

~~Amendment 41~~

~~Proposal for a regulation~~

~~Article 13 – paragraph 2 – subparagraph 2 – point iii~~

~~Text proposed by the Commission~~

~~Amendment~~

~~(iii) address the common priorities of the Union referred to in Annex VI;~~

~~(iii) address the common priorities of the Union referred to in Article 1;~~

~~Or. en~~

~~Amendment 42~~

~~Proposal for a regulation~~

~~Article 13 – paragraph 2 – subparagraph 2 – point iv~~

~~Text proposed by the Commission~~

~~Amendment~~

~~(iv) address relevant country-specific recommendations addressed to the Member State concerned, including, where applicable, recommendations issued under the Macroeconomic Imbalances Procedure;~~

(iv) address relevant country-specific recommendations addressed to the Member State concerned, under Article 121(4) and Article 148(4) TFEU including, where applicable, recommendations issued under the Macroeconomic Imbalances Procedure;

~~Or. en~~

~~Amendment 43~~

~~Proposal for a regulation~~

~~Article 15 – paragraph 2 – point f~~

~~Text proposed by the Commission~~

~~Amendment~~

~~(f) whether the public debt ratio at the end of the planning horizon is below the public debt ratio in the year before the start of the technical trajectory.~~

~~(f) whether the public debt ratio at the end of the planning horizon is below the public debt ratio in the year before the start of the technical trajectory;~~

~~Or. en~~

~~Amendment 44~~

~~Proposal for a regulation~~

~~Article 15 – paragraph 2 – point f a (new)~~

~~Text proposed by the Commission~~

~~Amendment~~

(f a) whether the delivery of investment and reforms responding to the main challenges identified within the European Semester, in the country-specific recommendations, correct the identified macroeconomic imbalances under the Macroeconomic Imbalances Procedure if applicable, and address the common priorities of the Union referred to in Article 1 of this Regulation, including the European Green Deal, European Pillar of Social Rights, including the EU and national targets on employment, skills and poverty reduction by 2030, and the Digital Decade while being consistent with the updated National Energy and Climate Plans and the National Digital Decade Roadmaps.

~~Or. en~~

~~Amendment 45~~

~~Proposal for a regulation~~

~~Article 16 – paragraph 1~~

~~Text proposed by the Commission~~

~~Amendment~~

The Council, on a recommendation from the Commission, shall adopt a recommendation setting the net expenditure path of the Member State concerned and, if applicable, endorsing the set of reform and investment commitments underpinning an extension of the adjustment period included in its national medium-term fiscal-structural plan within four weeks of the adoption of the Commission recommendation as a rule.

The Council, on a recommendation from the Commission, and after consulting the relevant advisory committees indentified in Article 26, shall adopt a recommendation setting the net expenditure path of the Member State concerned and, if applicable, endorsing the set of reform and investment commitments underpinning an extension of the adjustment period included in its national medium-term fiscal-structural plan within four weeks of the adoption of the Commission recommendation as a rule.

~~Or. en~~

~~Amendment 46~~

~~Proposal for a regulation~~

~~Article 17 – paragraph 1~~

~~Text proposed by the Commission~~

~~Amendment~~

Where it considers that the plan does not comply with the requirements set out in Article 15 (2) and (3) point (a), the Council shall, on a recommendation from the Commission, recommend that the Member State concerned submits a revised national medium-term fiscal-structural plan.

Where it considers that the plan does not comply with the requirements set out in Article 15 (2) and (3) point (a) and (b), the Council shall, on a recommendation from the Commission, and after consulting the relevant advisory committees identified in Article 26 recommend that the Member State concerned submits a revised national medium-term fiscal-structural plan.

~~Or. en~~

~~Amendment 47~~

~~Proposal for a regulation~~

~~Article 20 – paragraph 2~~

~~Text proposed by the Commission~~

~~Amendment~~

2. The annual progress report referred to in paragraph 1 shall contain in particular information about the progress in the implementation of the net expenditure path, the implementation of broader reform and investment commitments in the European Semester context and, if applicable, in the implementation of the set of reform and investment commitments underpinning an extension of the adjustment period.

2. The annual progress report referred to in paragraph 1 shall contain in particular information about the progress in the implementation of the net expenditure path, the implementation of broader reform and investment commitments in the European Semester context including the progress on EU and national targets on employment, education and poverty reduction by 2030 and, if applicable, in the implementation of the set of reform and investment commitments underpinning an extension of the adjustment period.

~~Or. en~~

~~Amendment 48~~

~~Proposal for a regulation~~

~~Article 22 – paragraph 1~~

~~Text proposed by the Commission~~

~~Amendment~~

Each national independent fiscal institution referred to in Article 8 of Council Directive […]32 [on the national budgetary frameworks] shall provide an assessment of compliance of the budgetary outturns data reported in the progress report referred to in Article 20 with the net expenditure path. Where applicable, each national independent fiscal institution shall also analyse the factors underlying a deviation from the net expenditure path.

~~Each national independent fiscal institution referred to in Article 8 of Council Directive […]32 [on the national budgetary frameworks] shall:~~

~~(a) provide an assessment of compliance of the budgetary outturns data reported in the progress report referred to in Article 20 with the net expenditure path,~~

~~(b) where applicable, each national independent fiscal institution shall also analyse the factors underlying a deviation from the net expenditure path,~~

~~(c) provide an assessment of the social impact of fiscal adjustment policy choices,~~

~~(d) incorporate social experts to work together economic experts in the assessments.~~

~~__________________~~

~~32 Council Directive […] of […] [amending Council Directive 2011/85/EU on requirements for budgetary frameworks of the Member States] (OJ …., …, p,…)~~

~~Or. en~~

~~Amendment 49~~

~~Proposal for a regulation~~

~~Article 26 – paragraph 1~~

~~Text proposed by the Commission~~

~~Amendment~~

The European Parliament shall be duly involved in the European Semester in order to increase the transparency and ownership of, and the accountability for the decisions taken, in particular by means of an economic dialogue. The Economic and Financial Committee, the Economic Policy Committee, the Employment Committee and the Social Protection Committee shall be consulted within the framework of the European Semester where appropriate. Relevant stakeholders, in particular the social partners, shall be involved within the framework of the European Semester, on the main policy issues where appropriate, in accordance with the provisions of the TFEU and national legal and political arrangements.

The European Parliament shall be duly involved in the European Semester in order to increase the transparency and ownership of, and the accountability for the decisions taken, in particular by means of an economic and social dialogue. The Economic and Financial Committee, the Economic Policy Committee, the Employment Committee and the Social Protection Committee shall be consulted within the framework of the European Semester where appropriate. Relevant stakeholders, in particular the social partners, shall be involved within the framework of the European Semester, on the main policy issues where appropriate, in accordance with the provisions of the TFEU and national legal and political arrangements.

~~Or. en~~

~~Amendment 50~~

~~Proposal for a regulation~~

~~Article 26 – paragraph 3 a (new)~~

~~Text proposed by the Commission~~

~~Amendment~~

~~The competent committees of the European Parliament may invite the Commission to discuss the following matters:~~

~~- the Commission’s medium-term public debt projection assessment of the national medium-term fiscal-structural plans as well as the debt sustainability analysis~~

~~- assessment of the information provided by Member States in the Annual Progress Reports~~

~~- assessment of the set of reform and investment commitments underpinning an extension of the adjustment period~~

~~- evaluation of the CSRs and social convergence risks, progress towards the implementation of the principles of the European Pillar of Social Rights.~~

~~Or. en~~

~~Amendment 51~~

~~Proposal for a regulation~~

~~Article 30 – paragraph 2~~

~~Text proposed by the Commission~~

~~Amendment~~

2. In that case, the Member State for which an excessive imbalance procedure is opened in accordance with Article 7(2) of Regulation (EU) No 1176/2011, it shall submit a revised plan in accordance with Article 14 of this Regulation. The revised plan shall follow the Council recommendation adopted in accordance with Article 7(2) of Regulation (EU) No 1176/2011. The submission of the revised plan shall be subject to the endorsement by the Council in accordance with Articles 16 to 19 of this Regulation. The revised plan shall be assessed in accordance with Article 15 of this Regulation.

2. In that case, the Member State for which an excessive imbalance procedure is opened in accordance with Article 7(2) of Regulation (EU) No 1176/2011, shall submit a revised plan in accordance with Article 14 of this Regulation. The revised plan shall follow the Council recommendation adopted in accordance with Article 7(2) of Regulation (EU) No 1176/2011. The submission of the revised plan shall be subject to the endorsement by the Council in accordance with Articles 16 to 19 of this Regulation. The revised plan shall be assessed in accordance with Article 15 of this Regulation.

~~Or. en~~

~~Amendment 52~~

~~Proposal for a regulation~~

~~Article 32 – paragraph 1~~

~~Text proposed by the Commission~~

~~Amendment~~

The Commission is empowered to adopt delegated acts in accordance with Article 33 to amend Annexes II to VII to adapt them to take due account of further developments or needs regarding the information in the national medium-term fiscal-structural plan (Annex II) or in the annual progress reports (Annex III), regarding the functioning of the control account (Annex IV), regarding the methodology for the assessment of plausibility (Annex V), regarding the common priorities of the Union (Annex VI) or regarding the assessment framework (Annex VII).

The Commission is empowered to adopt delegated acts in accordance with Article 33 to amend Annexes II to VII to adapt them to take due account of further developments or needs regarding the information in the national medium-term fiscal-structural plan (Annex II) or in the annual progress reports (Annex III), regarding the functioning of the control account (Annex IV), regarding the methodology for the assessment of plausibility (Annex V) or regarding the assessment framework (Annex VII).

~~Or. en~~

~~Amendment 53~~

~~Proposal for a regulation~~

~~Annex I – paragraph 1 a (new)~~

~~Text proposed by the Commission~~

~~Amendment~~

The social indicators linked to the achievement of the national targets, linked to the headline targets of the European Pillar of Social Rights and their main and secondary indicators, have progressed at the end of the period and are above the situation in the year before the start of the technical trajectory.

~~Or. en~~

~~Amendment 54~~

~~Proposal for a regulation~~

~~Annex II – paragraph 1 – point d~~

~~Text proposed by the Commission~~

~~Amendment~~

(d) Information on implicit liabilities related to ageing, and contingent liabilities with a potentially large impact on government budgets, including government guarantees, non-performing loans, and liabilities stemming from the operation of public corporations, including the extent thereof, potential expenses and obligations arising from court cases and, to the extent possible, information on disaster and climate contingent liabilities.

(d) Information on implicit and contingent liabilities with a potentially large impact on government budgets, including government guarantees, non-performing loans, and liabilities stemming from the operation of public corporations, including the extent thereof, potential expenses and obligations arising from court cases and, to the extent possible, information on disaster and climate contingent liabilities.

~~Or. en~~

~~Amendment 55~~

~~Proposal for a regulation~~

~~Annex II – paragraph 1 – point f~~

~~Text proposed by the Commission~~

~~Amendment~~

(f) In case the Member State makes use of assumptions referred to under point (e) that differ from the Commission’s assumptions over the adjustment period of the national medium-term fiscal-structural plan and the subsequent10-year period in the absence of further budgetary measures, due explanations and justifications based on sound economic arguments of these differences.

~~Or. en~~

~~Amendment 56~~

~~Proposal for a regulation~~

~~Annex II – paragraph 1 – point g~~

~~Text proposed by the Commission~~

~~Amendment~~

~~(g) An analysis of how changes in the main economic assumptions would affect the budgetary and debt position of the Member State.~~

(g) An analysis of how changes in the main economic and social assumptions would affect the budgetary and debt position of the Member State as well as the achievement of the national targets, linked to the headline targets of the European Pillar of social rights and their main secondary indicators and the common priorities of the Union in that Member State.

~~Or. en~~

~~Amendment 57~~

~~Proposal for a regulation~~

~~Annex II – paragraph 1 – point h~~

~~Text proposed by the Commission~~

~~Amendment~~

~~(h) If applicable, the duly substantiated reasons (with relevant sound and verifiable economic arguments) for deviating from the technical trajectory put forward by the Commission.~~

~~(h) If applicable, the duly substantiated reasons (with relevant sound and verifiable economic and social arguments) for deviating from the technical trajectory put forward by the Commission.~~

~~Or. en~~

~~Amendment 58~~

~~Proposal for a regulation~~

~~Annex II – paragraph 1 – point k~~

~~Text proposed by the Commission~~

~~Amendment~~

(k) If applicable, information on a specific, time-bound and verifiable set of reform and investment commitments underpinning an extension of the adjustment period pursuant to Article 13, a timeline for its implementation, as well as sound economic arguments that this set of reform and investment commitments fulfil the criteria under Article 13 taking into account the assessment criteria in Annex VII.

(k) If applicable, information on a specific, time-bound and verifiable set of reform and investment commitments underpinning an extension of the adjustment period pursuant to Article 13, a timeline for its implementation, as well as sound economic and social arguments that this set of reform and investment commitments fulfil the criteria under Article 13 taking into account the assessment criteria in Annex VII.

~~Or. en~~

~~Amendment 59~~

~~Proposal for a regulation~~

~~Annex II – paragraph 1 – point l~~

~~Text proposed by the Commission~~

~~Amendment~~

(l) A quantification, as much as possible, of the expected impacts of reforms and investment referred to under point (k) on fiscal sustainability, growth and employment, where applicable in line with commonly agreed methodologies.

(l) A quantification, as much as possible, of the expected impacts of reforms and investment referred to under point (k) on fiscal sustainability, sustainable growth and quality employment as well as upward social convergence, where applicable in line with commonly agreed methodologies.

~~Or. en~~

~~Amendment 60~~

~~Proposal for a regulation~~

~~Annex II – paragraph 1 – point n a (new)~~

~~Text proposed by the Commission~~

~~Amendment~~

~~(n a) If applicable, reforms and investments to correct the identified social convergence risks.~~

~~Or. en~~

~~Amendment 61~~

~~Proposal for a regulation~~

~~Annex II – paragraph 1 – point p~~

~~Text proposed by the Commission~~

~~Amendment~~

(p) For Member States with low public debt challenges but large implicit liabilities due to population ageing, the national net expenditure trajectory and the reforms in the national medium-term fiscal-structural plans should take due consideration of long-term fiscal sustainability challenges of public finances.

(p) For Member States with low public debt challenges but large implicit liabilities, the national net expenditure trajectory and the reforms in the national medium-term fiscal-structural plans should take due consideration of long-term fiscal sustainability challenges of public finances as well as social divergence risks as established in the most recent monitoring.

~~Or. en~~

~~Amendment 62~~

~~Proposal for a regulation~~

~~Annex II – paragraph 1 – point q~~

~~Text proposed by the Commission~~

~~Amendment~~

~~(q) Information on the consultations of social partners, civil society organisations and other relevant stakeholders in view of the preparation of the plan.~~

~~(q) Information on the effective consultations of social partners, civil society organisations and other relevant stakeholders in view of the preparation of the plan.~~

~~Or. en~~

~~Amendment 63~~

~~Proposal for a regulation~~

~~Annex III – paragraph 1 – point b~~

~~Text proposed by the Commission~~

~~Amendment~~

(b) A comparison from the beginning of the national medium-term fiscal-structural plan between the projections of the main economic variables submitted in that plan and the outturn data for these variables, as well as the implications for compliance with the net expenditure path set by the Council and the implications on the projected path of the public debt ratio reported in that plan.

(b) A comparison from the beginning of the national medium-term fiscal-structural plan between the projections of the main economic and social variables submitted in that plan and the outturn data for these variables, as well as the implications for compliance with the net expenditure path set by the Council and the implications on the projected path of the public debt ratio reported in that plan as well as the achievement of the the national targets, linked to the headline targets of the European Pillar of Social Right and their main and secondary indicators.

~~Or. en~~

~~Amendment 64~~

~~Proposal for a regulation~~

~~Annex III – paragraph 1 – point h~~

~~Text proposed by the Commission~~

~~Amendment~~

~~(h) The main assumptions about expected economic developments and main economic variables for the following years of the adjustment period, including the public debt ratio.~~

~~(h) The main assumptions about expected economic and social developments and main economic and social variables for the following years of the adjustment period, including the public debt ratio.~~

~~Or. en~~

~~Amendment 65~~

~~Proposal for a regulation~~

~~Annex III – paragraph 1 – point l~~

~~Text proposed by the Commission~~

~~Amendment~~

(l) An analysis of the evolution of the macroeconomic imbalances identified under the Macroeconomic Imbalance Procedure and of the impact on them of the implementation of the relevant reforms and investment reported in the national medium-term fiscal-structural plan in accordance with Annex II, point (n), where applicable.

(l) An analysis of the evolution of the macroeconomic imbalances identified under the Macroeconomic Imbalance Procedure as well as the social convergence risks and of the impact on them of the implementation of the relevant reforms and investment reported in the national medium-term fiscal-structural plan in accordance with Annex II, point (n) and (o), where applicable.

~~Or. en~~

~~Amendment 66~~

~~Proposal for a regulation~~

~~Annex VI~~

~~Text proposed by the Commission~~

~~Amendment~~

~~Common priorities of the Union~~

~~deleted~~

~~The common priorities of the Union referred to in Article 12, point (b) are:~~

~~(a) The European Green Deal34 , including the transition to climate neutrality by 205035 and the translation at national level through the National Energy and Climate Plans;~~

~~(b) The European Pillar of Social Rights36 including the related targets on employment, skills and poverty reduction by 2030;~~

~~(c) The Digital Decade Policy Programme 203037 , and reflected at national level through the National Digital Decade Strategic Roadmaps;~~

~~(d) A Strategic Compass for Security and Defence - For a European Union that protects its citizens, values and interests and contributes to international peace and security.38~~

~~__________________~~

34 Communication COM(2019) 640 final of 11 December 2019 from the Commission ‘The European Green Deal’ and Decision (EU) 2022/591 of the European Parliament and of the Council of 6 April 2022 on a General Union Environment Action Programme to 2030 (OJ L 114, 12.4.2022, p.22).

35 Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the framework for achieving climate neutrality and amending Regulations (EC) No 401/2009 and (EU) 2018/1999 (‘European Climate Law’).

~~36 (2017/C 428/09) Interinstitutional Proclamation on the European Pillar of Social Rights (OJ C 428, 13.12.2017, p. 10).~~

~~37 Decision (EU) 2022/2481 of the European Parliament and of the Council of 14 December 2022 establishing the Digital Decade Policy Programme 2030 (OJ L 323, 19.12.2022, p. 4).~~

~~38 Council of the European Union, COPS 130.~~

~~Or. en~~

~~Amendment 67~~

~~Proposal for a regulation~~

~~Annex VII – point 2 – paragraph 1~~

~~Text proposed by the Commission~~

~~Amendment~~

In accordance with Article 13(2), the set of reforms and investment commitments included in the national medium term fiscal structural plans underpinning an extension of the adjustment period shall be commensurate with the degree of public debt challenges as established in the most recent update of the Debt Sustainability Monitor in combination with the social divergence risks as established in the most recent monitoring, challenges to medium-term growth in the Member State and challenges for the achievement of the the national targets, linked to the headline targets and their main and secondary indicators of the European Pillar of Social Rights. For Member States where public debt challenges are linked to significant challenges to medium-term sustainable growth, the set of reforms and investments is expected to also address bottlenecks to medium-term sustainable growth.

~~Or. en~~

~~Amendment 68~~

~~Proposal for a regulation~~

~~Annex VII – point 2 – paragraph 2 – point 2.1 – introductory part~~

~~Text proposed by the Commission~~

~~Amendment~~

~~2.1 The set of reform and investment commitments are growth-enhancing;~~

~~2.1 The set of reform and investment commitments are sustainable growth-enhancing;~~

The set of reform and investment commitments are expected to entail a significant progress towards the national targets, linked to the headline targets of the European Pillar of Social Rights and their main and secondary indicators.

~~Or. en~~

~~Amendment 69~~

~~Proposal for a regulation~~

~~Annex VII – point 2 – paragraph 2 – point 2.2 a (new)~~

~~Text proposed by the Commission~~

~~Amendment~~

~~2.2 a The set of reform and investment commitments support upward social convergence;~~

~~Or. en~~

~~Amendment 70~~

~~Proposal for a regulation~~

~~Annex VII – point 2 – paragraph 2 – point 2.3 – introductory part~~

~~Text proposed by the Commission~~

~~Amendment~~

~~2.3 The set of reform and investment commitments address priorities of the Union referred to in Annex VI;~~

~~2.3 The set of reform and investment commitments address priorities of the Union referred to in Article 1;~~

~~Or. en~~

~~Amendment 71~~

~~Proposal for a regulation~~

~~Annex VII – point 2 – paragraph 2 – point 2.3 – indent 1~~

~~Text proposed by the Commission~~

~~Amendment~~

~~– The set of reform and investment commitments contribute significantly to at least one of the priorities of the Union referred to in Annex VI;~~

~~– The set of reform and investment commitments contribute significantly to at least one of the priorities of the Union referred to in Article 1;~~

~~Or. en~~

~~Amendment 72~~

~~Proposal for a regulation~~

~~Annex VII – point 2 – paragraph 2 – point 2.4 – introductory part~~

~~Text proposed by the Commission~~

~~Amendment~~

2.4 The set of reform and investment commitments, taken altogether, addresses relevant country-specific recommendations, including, where applicable, recommendations issued under the Macroeconomic Imbalance Procedure;

2.4 The set of reform and investment commitments, taken altogether, addresses relevant country-specific recommendations under Article 121(4) and Article 148(4) TFEU, including, where applicable, recommendations issued under the Macroeconomic Imbalance Procedure;

~~Or. en~~

~~Amendment 73~~

~~Proposal for a regulation~~

~~Annex VII – point 2 – paragraph 2 – point 2.4 – indent 1~~

~~Text proposed by the Commission~~

~~Amendment~~

– The set of relevant reform and investment commitments underpinning the extension of the adjustment period, taken altogether is expected to address challenges identified in the relevant country-specific recommendations, including the recommendations issued under the Macroeconomic Imbalance Procedure where applicable, taking into account the scope and scale of the country-specific challenges and the commitments made under the Recovery and Resilience Plans, where relevant;

– The set of relevant reform and investment commitments underpinning the extension of the adjustment period, taken altogether is expected to address challenges identified in the relevant country-specific recommendations, including the recommendations issued under the Macroeconomic Imbalance Procedure where applicable and including the recommendations issued pursuant Article 148(4) TFEU or the implementation of the principles of the European Pillar of Social Rights, taking into account the scope and scale of the country-specific challenges and the commitments made under the Recovery and Resilience Plans, where relevant;

~~Or. en~~