EU set to recommend budget measures

Ireland is half way through the European ‘semester’ budget-setting process, with the European Commission set to report in early June with country specific recommendations, according to Europe Minister Paschal Donohoe.

Paschal Donohoe: Setting out economic reforms.

This is the first full year of the new semester programme after the country emerged from the EU-IMF bailout last December.

The process is one of the new initiatives introduced in the wake of the debt crisis. Before the economic collapse in 2008, national parliaments had full responsibility for setting annual budgets.

And even though each member state was supposed to stay within the terms set out in the EU’s growth and stability pact, this was regularly flouted.

The new semester programme involves a much higher degree of intrusion by the commission.

“We have completed and submitted to the commission our National Reform Programme for 2014 and the Stability Programme Update,” said Mr Donohoe. “These documents set out the economic and budgetary reforms we have undertaken and are continuing to implement, and they will inform the approach that the Commission will take in proposing country specific recommendations for Ireland in early June,” he said.

The semester programme has prompted a backlash from some member states as it is seen as adding to the EU’s democratic deficit. However, Mr Donohoe said it should be seen as a collaborative process rather than the Commission imposing policies.

Moreover, he said the aim of the programme was to promote growth and competitiveness, reduce unemployment, make national budgets sustainable, and restore credit to the wider economy.

“These are policies that we would be introducing anyway,” he said. “But the process is evolving and the challenge in the future is to increase the role of national parliaments.”

Mr Donohoe said: “At the start of April, I had the opportunity to present the draft National Reform Programme to the joint committee on European Union affairs and Minister Noonan presented the draft Stability Programme Update to the joint committee on finance and public expenditure before Easter.

“I very much welcome the involvement of the Oireachtas as a means of providing democratic scrutiny of the semester process, and I believe one of the issues we have to consider is how to strengthen the role of national parliaments in the European semester process in the future.”

He said the Commission’s recommendations will be published in early June and adopted by the European Council later that month.

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