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Vice-President of the European Commission - Responsible for Interinstitutional Relations and Administration

Presentation of Commission Work Programme 2012

Audition at the National Parliament

Lisbon, 10 January 2012

Thank you for your kind invitation to come to Lisbon for this exchange of views with Members of the Assembly and particularly of your committee, as well as Members of the European and regional parliaments.

I believe that regular direct contacts at political level, between Members of the Commission and national Parliamentarians, are of utmost importance, as they facilitate our communication on key policy projects and foster mutual understanding.

Let me say right at the start that the Commission very much appreciates the genuine interest shown by your Parliament in the various exchanges with the Commission, and your knowledgeable input. In fact, you have been the most active of all national parliaments since 2008! I take this opportunity to thank the Assembly particularly for its opinion on the Work Programme for 2011. This continuous dialogue with national parliaments is indispensible in shaping the priorities of the Union. And national parliaments have an even more important role to play as we start to see closer European economic governance.

Even if we do not always share the same views, the exchanges we hold are always stimulating, and the Commission especially appreciates your very constructive approach.

In today's presentation of the Commission's Work Programme, I will naturally focus on ways to tackle the economic crisis, stimulating growth by further strengthening the Single Market and streamlining the European Research Area. I will also outline action in the social field and budgetary proposals for the period 2014 -2020.

We are entering the 5th consecutive year trying to deal with the most severe economic crisis since the Great Depression. How successful are we, so far?

When we look at the statistics, especially at the unemployment rates, and specifically among young people, there is no room for complacency. Poverty is on the rise. If the level of development of a society is to be judged by the conditions of life for its most vulnerable members, then we are witnessing regression across Europe.

I could argue it could be much worse, and we could debate that for hours. But the point is: we all have a responsibility for what is happening. This is not something caused just by American subprime mortgages, or even insufficient regulation of the global financial sector. We are going through a major test of an entire economic model, and our competitiveness is under threat.

In acute need of recapitalisation, the banking sector is now deleveraging, which has a major impact on both the real economy and the whole financial sector. Coupled with coordinated cuts in public expenditure, this has a significant deflationary impact on both internal and external demand. How can we re-launch growth? How can we invest for the future?

Does this mean increasing public spending at national level? Definitely not. As long as there is no monetary stability and the capital markets are in turmoil, increasing public spending would just further weaken the position of States in the minds of potential buyers of public debt. There can't be growth without stability.

This is why President Barroso has called for a European Renewal. A renewal built on stability and responsibility. On growth and solidarity.

Europe 2020 is the EU's agreed strategy for economic renewal. It sets out a clear direction for an EU which is smarter, greener and fairer. More competitive. An EU that delivers lasting jobs and prosperity to its citizens.

Europe 2020 balances the urgent need to restore stability with a long-term framework for reform. And national and European levels must work together to achieve this.

In a political agenda dominated by immediate urgencies, we cannot neglect investing in the future. In other words, we must put out the fire and lay the foundations of our new house at the same time.

The Commission Work Programme 2012 is a programme designed to do just that. A programme of ambition and new initiatives, but also a programme of consolidation and continuity. And its multiannual nature allows all stakeholders, not least national parliaments, to plan ahead.

Growth is at the heart of the work programme for 2012. We cannot wave a magic wand to bring back growth. But we can ensure that when growth returns, we are ready to direct it in the most productive and sustainable direction.

The key to unlock growth is competitiveness. And competitiveness is based on strong framework conditions that help business to thrive. This means modernising the single market, reducing bureaucracy, facilitating access to capital or providing support for research and innovation.

The Single Market is the EU's motor of growth. But to run smoothly and at full speed, it must be fuelled and maintained. With the 12 proposals set out in the Single Market Act, the Commission launched the first phase of an ambitious process to bring the Single Market into the 21st century. Early adoption of these measures would show an EU determined to do everything possible to boost growth and create jobs.

This is a clear priority and therefore the Commission will push the single market agenda further. New opportunities are waiting to be explored and exploited – not least in the digital Single Market. By 2015, 50% of Europeans should be buying online, and a third of SMEs should be doing business online. We expect to halve the number of Europeans who have never used the internet, and the difference between roaming and national tariffs should be close to zero.

Take the example of the on-line music business, which holds great retail potential. The Commission proposes new rules for cross-border licensing to expand the markets for entrepreneurs and artists.

Then there is e-government. Portugal does very well here, and the use of online tools can be an avenue for growth.

We will also propose a common framework for electronic identification and signatures. This can boost electronic transactions across the EU and encourage both consumers and businesses to make the most of opportunities.

Efficient, modern infrastructures are the lifeblood of a thriving Single Market. With the Connecting Europe facility, the Commission has proposed a way to support key investment in energy, transport and broadband. To assist public and private actors in creating tomorrow's networks - today. It is proposed to fix the facility at €50 billion, with an expected 20-fold multiplier effect – in other words, €1,000 billion injected into the economy.

We will also propose measures to tackle fragmentation in the European Research Area. This will help realise the so-called 'fifth freedom', namely the free circulation of knowledge. We want to see researchers spend more time in labs, and less time on paperwork.

In 2012, we will also aim to complete the ambitious overhaul of financial regulation and supervision, which the Commission has undertaken in recent years. This will provide all stakeholders with a stable and transparent environment for healthy, growth-stimulating investment.

When we let down young people, we lose the future. The high youth unemployment that we witness today is one of our most pressing and serious challenges. 7.5 million young people across Europe are 'EENTs' - not in employment, education, nor training.

Many of the levers of social and employment policy are national, regional or local. But the Commission will propose complementary action at European level based on the flagships for skills and social inclusion. The Commission will assist job-seekers in exploring opportunities by enhancing the information systems to better match skills and job openings across borders – with the creation of a Youth on the Move card.

Building a European energy system that ensures sustainability, competitiveness and security of supply also remains a top priority. In 2012 this includes a review of nuclear safety rules and the launching of a strategy for deployment of renewable energy beyond current commitments.

We cannot discuss the EU's political agenda for 2012 without talking about the EU's budget. Much political effort this year will indeed be dedicated to ensuring the adoption of the Commission's proposals for the period 2014-2020. The modernised instruments on agriculture, on cohesion, on employment, on research and innovation and on infrastructure will lead to a major renewal of one our most crucial investment tools.

Reaching agreement on the EU budget is a key priority for this year. Europe needs forward-looking investment to match austerity.

I stressed earlier that at the end of the day the success of an economic renewal depends on implementation. It seems self-evident, yet the delivery of results must get our full attention in 2012 at several levels:

At national level, efforts to follow-up the 2012 European semester must be stepped up. Despite a high level of political commitment, many of the reforms identified and agreed for 2011 have not been implemented to a sufficient degree. This must change. You play a key role in keeping your government accountable and in helping to deliver on European commitments.

The Commission has already tabled a range of key proposals to help drive reform and lift competitiveness. Many of these proposals are today pending before the Council and the European Parliament. The EU patent is an example of how delays bring real costs: if adopted, it would reduce by 80% the cost of inventions by our companies. Likewise, Commission proposals on standardisation, energy savings or roaming charges are waiting for Member States and the European Parliament to make progress.

Ladies and gentleman, as I said we stand before a challenge to our economic and social model. We need to rise to this challenge together, European institutions and national Parliaments, and make sure we deliver for our citizens.

Let me conclude by saying that I do believe that this Parliament and the Portuguese government are doing just that – delivering for their citizens.

By implementing the commitments made in the Memorandum of Understanding, by delivering the targets as agreed, you are restoring Portugal's credibility to the outside world, and not just with financial markets.

This positive assessment was clearly set out in the troika report from last November, which resulted in the latest disbursement, and I am confident that another positive assessment will follow after the next troika review in February.

I understand this is not an easy task, and that there are many difficulties ahead. 2012 will not be an easy year, but there is hope that 2013 will already see improvements.

This clearly shows that you are going in the right direction, and this has been recognised by markets in the recent auction of Portuguese debt bonds, and the EU's success in issuing a long-term bond with 30-year maturity, funding loans of €3 billion for Ireland and Portugal. I don't need to tell you that this recognition is not in supply for other EU Member States under adjustment programmes….

Ladies and gentlemen, it is a difficult road ahead of us, but one I encourage you to take. Your country has a long history of overcoming difficulties and opening up new frontiers to the world. I am sure you will once again overcome the challenges you face and emerge stronger!

Thank you.

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