Green light from the European Parliament to reform of the Stability Pact. The directive for the new economic governance passed with large majority on three legislative texts: 359 votes in favour, 166 against and 61 abstentions, out of a total of 586 present in Strasbourg. Also approved preventive arm with 367 yes, 161 against and 69 abstentions, and the corrective arm with 368 yes, 166 against and 64 abstentions.
The proposal, carried out by the Commissioner for the Economy Paolo Gentiloni, was mediated by Sanchez's Spain, which held the rotating presidency of the EU. “It is a good compromise” but above all “it is the result of everyone's determination to carry forward and improve the current legislative framework” said Gentiloni.
Only four Italians vote in favor
Almost all Italian MEPs abstained or voted against. They were the ones who voted in favor only four: Lara Comi and Herbert Dorfmann of the EPP, Marco Zullo and Sandro Gozi of Renew. The Democratic Party abstained, criticizing the text as "excessively pejorative", despite the support of the socialist group. Fratelli d'Italia, Forza Italia and Lega also abstained. The M5S voted against, denouncing a "return of austerity", together with former M5S members now in the Greens. The Italians of Renew Europe were divided: Castaldo voted against, while Danti abstained. The League defined the reform as "failed", suggesting that with a different majority in Europe changes could be made for greater flexibility and more public investment. The electoral campaign also weighs on the vote in progress.
Gentiloni: “Ready to open a new chapter for economic governance in the EU”
After the vote, the Commissioner for the Economy Paolo Gentiloni He underlined that the EU is emerging “from four exceptional years for the economy, characterized by the application of the general escape clause” which gave member states the necessary room for maneuver to deal with shocks. Now, the EU is ready to “inaugurate a new chapter in economic governance”, which should face current and future challenges “with renewed confidence”. Gentiloni added that the EU Council will soon be able to give the final green light to the legislative package. The EU Council will now be able to "give the final green light to this key legislative package in the coming days", he added.
“This week marks exactly one year since the Commission presented its proposals to reform our economic governance, although the preparatory work began at the very beginning of this mandate,” Gentiloni continued. “Our goal has always been to correct such rigid rules which were often not applied and we succeeded in this objective: as happens after every negotiation, the reform adopted today is a compromise, which is not perfect, and does little to reduce complexity, but is better than existing rules.” And it is for four main reasons: strengthening incentives for public investments, defining a credible path to reduce debt, fiscal responsibility of Member States within a common European framework and greater emphasis on social and climate aspects.
What does the new stability pact provide?
Il new EU Stability Pact requires countries with public debt above 60% of GDP to present reduction plans within 4 years, extendable to 7 with reforms and investments. These plans will be national and the benchmark will be net primary expenditure, excluding interest and other specific expenditure. The Commission will publish “reference trajectories” for countries with deficits above 3% of GDP or debt above 60%, establishing public finance adjustment objectives to ensure a decline in debt or keep it at prudent levels. These trajectories will be communicated to the countries by June 21st, with the presentation of the multi-year spending plans by September 20th.
