Written Answers. - ECOFIN Meeting.
Derek McDowell
Question:
93
Mr. McDowell
asked the
Minister for Finance
the matters discussed and conclusions reached at the meeting of EU Finance Ministers in Luxembourg on 5 June 2001; the main features of the broad economic policy guidelines agreed at the meeting; and if he will make a statement on the matter.
[19193/01]
The agenda for the meeting of Economic and Finance Ministers, ECOFIN, which I attended on 5 June 2001 in Luxembourg consisted of a number of issues.
Under the heading of Preparation for the Gothenburg European Council, three issues were discussed. These were the 2001 Broad Economic Policy Guidelines, BEPGs, sustainable development and taxation issues.
In regard to the BEPGs, the Council agreed on the text to be sent to the Gothenburg European Council for political endorsement by the Heads of State and Government. The BEPGs would then be formally adopted by a special session of ECOFIN in Gothenburg.
The annual BEPGs are intended to define the main objectives and policy orientations for European economic policy in general and for individual member states over a 12 month period.
The section of the 2001 guidelines which applies to all member states identifies three main challenges for the future: in the short term – to preserve the expansion in growth and jobs; in medium term – to improve the basis for future growth and employment and in the longer term – to prepare for the impact of the ageing population.
The section of the guidelines on Ireland notes that economic growth is slowing due to the slowdown in the US and the effects of the foot and mouth disease, and that inflation is set to moderate. The guidelines recommend that budgetary policy be used to ease demand in the economy and public expenditure control be strengthened. The guidelines acknowledge our strong employment growth, that we are well exposed to international competition and the ongoing structural change in our capital markets.
Ireland, like most other member states, had before Gothenburg sought a number of amendments to the draft guidelines, some of which have been reflected in the final text.
We set out our position in a minute statement – which draws attention to the views we expressed at the time the recommendation to Ireland in respect of the 2000 BEPGs was being considered at the ECOFIN of 12 February 2001, and to the uncertainties which are inherent in macroeconomic forecasts on which the guidelines are necessarily based – which was included in the minutes of the ECOFIN meeting of 5 June.
Returning to the other items discussed at ECOFIN, the Council had an exchange of views on the Commission's communication on sustainable development.
The Council took note of a number of reports relating to the tax package, the taxation of savings and the code of conduct and approved conclusions with regard to the taxation of savings and the code of conduct and with regard to the future work on all aspects of the tax package. Under the heading of indirect taxation, Ministers examined the issue of VAT on e-commerce and energy taxation. The Council agreed that discussions on these issues would continue.
Ministers took note of the Commission's progress report on the implementation of the financial services action plan and welcomed the adoption of the key directives on the reorganisation and winding-up of credit institutions and insurance undertakings. Ministers also agreed in principle on macro-financial assistance to the Federal Republic of Yugoslavia, and agreed conclusions relating to the financial regulation applicable to the EU budget and to the fight against fraud.
The lunchtime discussion included progress on the Lamfalussy report on the regulation of the European securities market, economic dialogue with Russia, and the usual Presidency debriefing on the Eurogroup meeting which was held the previous evening.
