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DRAFT OPINION (COM(2023)0240 – C90150/2023 – 2023/0138(COD))

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

EMPL-PA-752621

Committee on Employment and Social Affairs · Rapporteur: Gabriele Bischoff

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The Committee on Employment and Social Affairs gives its draft opinion on the proposed regulation on coordination of economic policies and multilateral budgetary surveillance, which would repeal Council Regulation (EC) No 1466/97. It proposes amendments to add social and employment objectives throughout the text, including upward social convergence, the European Pillar of Social Rights and its targets, and quality employment. It calls for social partners to be consulted when preparing and assessing the medium-term fiscal-structural plans, and for independent fiscal institutions to assess the social impact of fiscal choices and include social experts. It asks for a surveillance mechanism and early warning system to monitor and prevent social convergence risks and social imbalances. It proposes that the common priorities of the Union, including the European Green Deal, the European Pillar of Social Rights, the Digital Decade and the Strategic Compass, be set out in Article 1 rather than Annex VI.

Committee position. The committee proposes amendments to the Commission proposal to add social and employment objectives, strengthen social partner consultation, introduce monitoring of social convergence risks, and give independent fiscal institutions a role in assessing social impacts.

Key points

  1. The committee calls on the Committee on Economic and Monetary Affairs to take its amendments into account.
  2. The economic governance framework should take into account social considerations, support upward social convergence and pay attention to quality employment and social objectives.
  3. Multilateral surveillance should monitor economic, employment and social developments, including progress towards the national targets linked to the European Pillar of Social Rights, and a surveillance mechanism for social convergence risks should be set up.
  4. National medium-term fiscal-structural plans should promote debt sustainability, sustainable and inclusive growth and upward social convergence, and take account of Recovery and Resilience Plan commitments.
  5. Member States should consult social partners when preparing the plans, and the plans should describe the consultation of local and regional authorities, social partners, civil society, youth organisations and other stakeholders.
  6. An early warning system should let the Commission alert a Member State at an early stage about the need for corrective action to prevent social divergence risks.
  7. The common priorities of the Union should be listed in Article 1: the European Green Deal, the European Pillar of Social Rights, the Digital Decade and the Strategic Compass.
  8. The regulation should support sustainable and inclusive growth and quality employment, and ensure the necessary economic and social investments.
  9. The Commission should consult social partners before putting forward the technical trajectory, and consult them on the sustainability of the adjustment trajectory and the plausibility of the debt trajectory.
  10. The extension of the adjustment period should be underpinned by reforms and investments that enhance sustainable and inclusive growth, support upward social convergence and address the common priorities of the Union.
  11. Independent fiscal institutions should assess the social impact of fiscal adjustment choices and incorporate social experts alongside economic experts.
  12. The European Parliament should be involved in the European Semester through an economic and social dialogue, and its competent committees may invite the Commission to discuss debt projections, progress reports, reform commitments and social convergence risks.

Who is affected

  • Member States, which must consult social partners on their medium-term fiscal-structural plans and report on social and employment progress.
  • Social partners, who should be consulted when plans are prepared and on the sustainability of the adjustment trajectory.
  • National independent fiscal institutions, which must assess the social impact of fiscal choices and include social experts.
  • The Commission, which should consult social partners and operate an early warning system for social divergence risks.

Figures and deadlines

  • The adjustment period can be extended by a maximum of 3 years.
  • The technical trajectory covers a minimum adjustment period of 4 years.
  • The deficit should durably stay below the 3% of GDP reference value.
  • The public debt reference value is 60% of GDP.
  • The Council should adopt its recommendation within four weeks of the adoption of the Commission recommendation as a rule.
  • The European Pillar of Social Rights targets on employment, skills and poverty reduction are for 2030.
  • The transition to climate neutrality is by 2050.