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European Commission

José Manuel Durão Barroso

President of the European Commission

Speech by President Barroso at the EP plenary debate on the Irish Presidency of the Council

European Parliament plenary session/Strasbourg

16 January 2013

Dear President,

Dear Taoiseach,

Honourable Members,

Every Presidency is a landmark, but this time it is particularly true. This is the 7th time Ireland holds the Presidency. It is also 40th anniversary of Ireland's accession to the European Union.

As such it is a reminder of the past achievements of our Union, the current challenges and the future work ahead of us, as we seek not to replicate the past but to build a better future.

Indeed, I am convinced that having Ireland at the helm of the rotating Presidency of the Council at this juncture will be good for Ireland and good for Europe.

Last week the Commission met in Dublin with the Taoiseach and the Irish government to discuss our shared priorities. Together, we stressed the need to lay the foundations for lasting growth and job creation. Stability, growth and jobs: these are the priorities Ireland has set for the Presidency programme, priorities which I very much welcome and which have been at the heart of the Commission's actions since the start of the crisis.

As I said to this House yesterday during the debate on the Cyprus Presidency we have by the end of 2012 achieved much in the way of stability. The forecasts of the doomsayers who predicted the implosion of the Euro have been proved wrong. European countries have shown through their actions that we will stand together, the Union as a whole, to face the challenges ahead.

We all know there is very important and difficult work to do to achieve the goal of sustainable growth and I underline "sustainable", because we have seen in the past that artificial growth fuelled by irresponsible public or private debt is simply not viable. While going on with further steps to a deeper economic and monetary union -and in this context the approval of the so-called two pack comes to mind as an urgent priority - we must pursue fiscal consolidation, enact economic reforms for competitiveness and also make targeted investments for growth. And above all we need to tackle the very serious social situation that we have in too many of our Member States.

Let me start with the short term steps to put in place banking union.

It is good that the Member States were able to find consensus on the Single Supervisory Mechanism just three months after the Commission proposal. I now hope that Parliament and Council will be able to finalise the agreement as quickly as possible in the next weeks. This is a key test to demonstrate that the European Union has the political will and capacity to act quickly on the big issues.

An agreement on the Single Supervisory Mechanism also shows that we can reach agreement, within the EU as a whole, on deepening the Euro Area. And as you know we are clearly attached to the principles of the integrity, not only of the Single Market, but the integrity of our Union, while accepting and promoting the deepening of the EMU.

Reaching political agreement on the proposal in time for discussion at your plenary session in early February is not impossible with political will. [Parliament has worked on this very efficiently and the Thyssen and Giegold reports are constructive and supportive, and in very many points rather similar to the approach taken by the Council.] The Commission will do everything it can to facilitate and assist the intensive trilogue discussions to deliver final agreement on this important piece of legislation.

I know the importance this House attaches to the next stage of banking union – the single resolution mechanism. Proposals are already before you which would allow for the harmonisation of national bank resolution tools.

But to completely break the vicious link between bank failure and sovereign debt, we need to go further and provide for a single resolution mechanism to match the single supervision we are putting in place for the euro area and other Member States who wish to participate. This raises some very complex legal and technical issues, but we are determined to work through these quickly and aim to present a proposal before the summer. I consider this a matter of utmost political priority.

Honourable members,

Stability means more than financial stability. We must increase our efforts to ensure economic and social stability.

Of course, economic growth is the best means to generate employment and to improve the social situation.

The Single Market is the Union's largest engine for growth. To release the full benefits of the single market we are pushing forward with the two Single Market Acts.

I welcome the Irish Presidency's commitment to securing the adoption of the proposals already on the table. The Commission will present the remaining Single Market Act 2 legislative proposals this spring.

In all of this we look forward to continuing the very good co-operation with this House to ensure that legislation is not only put on the statute books but is implemented as soon as possible to the benefit of all our citizens.

Of course creating opportunities within the single market is one thing, taking advantage of the opportunities is another. This is why we will work to implement the action plan for entrepreneurship and place a particular focus on SMEs to ensure that these opportunities are translated into increased economic activity and more jobs.

We have all committed to growth through our Europe 2020 Strategy and the Compact on growth and jobs. But the time has come to make good on this commitment. This will be driving Europe's work over the Irish Presidency and beyond as made clear in the Commission's annual work programme.

As leverage for growth and investment, we must have an agreement on the multi-annual financial framework. It is a new year but the message remains the same, and it remains equally valid: the European budget is the budget for investment growth and jobs at the European level.

Now is the time for governments to match actions to their rhetoric: if you state that growth in Europe is vital for your national economy then you need to support European measures to promote that growth. I hope that the European Council will agree on the MFF very soon, probably in the beginning of February, but governments should not forget that while their agreement is necessary, it is not sufficient. The European Parliament's approval is also indispensable.

The Commission has and will continue to focus on supporting employment. Last April we presented the "Employment Package" with a set of key measures to support job creation, to restore the dynamics of the labour market and to enhance the EU governance.

In December, the Commission has presented a proposal to combat youth unemployment: the "youth guarantee" scheme is a concrete measure with renowned potential to enhance school-to-work transitions and ensure every young person gets into further education, training, an apprenticeship or a job within 4 months. The Commission has also called for urgent action in "re-thinking education", maximising the investments in skills is essential to achieve better socio-economic outcomes. In our discussions with Taoiseach Kenny and the Irish government I have been heartened by the importance that the Irish Presidency will place on these issues, in particular its commitment to reach agreement on the Youth Guarantee already next month.

The solution to our social crisis is not to abandon the European Social Model. The solution is to recognise the immense challenges that globalisation poses for European competitiveness and to reform our social market economy addressing the important issues of competitiveness. The Commission is preparing a Social Investment Package with a set of focused and concrete actions on how these reforms can take shape in our Member States and what the EU can do to support them.

Honourable Members,

Ultimately, European stability is also provided by confidence and confidence comes out of a clear, realistic and achievable vision of the future, and that means for Europe's future architecture. Plans for deeper economic and monetary union help generate stability by showing investors that there is a clear vision for the future. Over the course of this year the Commission will, building on the blueprint we presented last year, set out in a more detailed manner the steps needed to deepen economic and monetary union, including a social dimension in the EMU and the necessary accompanying steps towards political Union.


Honourable Members,

I am confident that during the Irish Presidency we will look beyond our European borders. The world economy is changing beyond recognition, with new centres of growth appearing and the pace of globalisation increasing.

Europe needs to be an active global player to benefit from worldwide economic potential and to promote our values. Europe has lots of advantages. Despite the current difficulties, Europe's average debt-to GDP ratio is 82.5%, compared to the United States' rate of 103% and Japan's nearly 230%. And, and this fact is less known, unlike other major industrialised economies that have been losing their share of the world market, the European Union has preserved its share of the world market. But of course there are very important differences among Member States of the European Union.

We will continue to deepen economic ties with both our well established strategic partners and the dynamic emerging economies. We look forward to the approval, now that the negotiations are concluded, of the Singapore FTA, we look forward to completing FTA negotiations with Canada and to start negotiations with Japan. We will pursue with vigour our negotiations with India, Malaysia and Vietnam. We will also set out a clear vision on deepening economic ties with the United States which remains our single most important economic partner. And in spite of everything that we hear these days, the reality is that the European Union and the United States is by far the most important economic relationship in the world.

Nor must we neglect our neighbours to the south and to the east. Our relations with these countries are a reminder that our trade policy, indeed all our external economic policy from assistance to energy, transport to research are not just vital for our economic interests but for Europe's capacity to play a significant, constructive role at the global level.

President, Taoiseach,

Honourable Members,

Allow me to conclude with a remark on Ireland, which has shown an impressive commitment to implementing the economic adjustment programme.

The Irish people have had to make great sacrifices to ensure the recovery of the country. And so have the people of Greece, Portugal, Spain, but also other countries which carry out difficult but indispensable reforms.

The Irish case shows that provided there is the political will to accompany the sacrifices, programmes can and do work and reform can go hand-in-hand with social cohesion. Economic growth in Ireland was stronger than expected at the end of last year, the deficit is lower than predicted and Ireland has already made a first successful return to financial markets.

Of course, important challenges remain; especially tackling unemployment and the reducing further the very high deficit. The European Commission will stand by Ireland as we will stand with the other programme countries in particular. The Commission supports all measures that will improve market confidence and increase public support for the reform process. In parallel, I have always made and will always make the case for the need for solidarity and for the need for fairness in the European Union.

As I mentioned in my introduction, Ireland has been an active and valued member of the European Union for 40 years, it has greatly benefited from its membership in the past, and through its Presidency of the EU will have an important role in shaping the new European Union for the future to the benefit of this generation and generations to come.

The great poet William Butler Yeats commenced his collection "Responsibilities" with the sentence:

"In dreams begins responsibility"

I would add "In responsibility begins action" and over the next 6 months there will be plenty of action, from the Presidency, from the Commission and I am certain too from this Parliament.

And I'm sure that the six months of the Irish Presidency of the Council will be an Irish and a European success story.

Thank you for your attention.

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