The Commission wants broader and deeper supervision on national economic policies
euinside, February 16, 2010
The European Commission intends to ask for a broader and deeper supervision over national economic policies in the euro area, the new Economic and Monetary Affairs Commissioner Olli Rehn announced last night. He added after a late evening meeting of the Eurogroup (the eurozone financial ministers) that the European Commission is will very soon make concrete proposals for an increase of coordination and supervision over economic policies of euro area member states.
The proposals are still being developed and they have a legal basis in the Lisbon Treaty - article 136 - which provides new instruments for a broader and deeper control on a Community level. In this context, Mr Rehn specified, the Commission will focus not only on budgetary policies but also on structural issues and macro economic imbalances. Part of these imbalances are the enormous divergences in competitiveness for which the president of the Eurogroup, the premier of Luxembourg Jean-Claude Juncker also spoke about. He said that this would be one of the tasks of ECOFIN in the months ahead.
So far the European Commission has relied on and trusted the financial statistics of member states. But after it was revealed that Greece manipulated its data so as to present its financial situation as stable, EU's executive body fell into a very awkward situation to present reports, almost entirely based on the word of honour of national governments.
It is still not very clear how did euro area member states reacted to the proposal. Later on euinside you can expect more news about last night's Eurogroup session as well as today's ECOFIN meeting.