§ Mr. Llew SmithTo ask the Chancellor of the Exchequer what matters in regard to the cost of implementation of European Community directives he raised at the ECOFIN Council in Brussels on 22 November.
§ Ms QuinTo ask the Chancellor of the Exchequer if he will make a statement on the outcome of the ECOFIN Council of 22 November.
§ Mr. Kenneth ClarkeThe Economic and Finance Council of the European Union—ECOFIN—met in Brussels on 22 November. I represented the United Kingdom.
There was detailed discussion on the Commission's ideas for the White Book on a medium-term strategy for growth, competitiveness and employment that they are preparing for the European Council in December. Virtually all member states agreed that obliging employers to introduce new work-sharing arrangements was not the solution to the present high levels of unemployment. Other member states also shared our concern that the Commission appeared to be giving insufficient weight to the need for structural reforms to improve the flexibility of labour markets. The Council invited the Commission to take account of the points made in discussion in preparing the White Book.
The Council had a general orientation debate on the broad economic policy guidelines under article 103 of the treaty. These guidelines take the form of recommendations and are not legally binding. There was a general consensus that the guidelines should provide a credible framework 273W without being over-prescriptive about how member states should set their economic policies. It was agreed that the Council would meet again on 5 December to consider the Commission's formal recommendation, and to agree its report to the European Council.
France and Germany presented convergence programmes to the Council. The Council concluded that the French programme was solid and coherent and welcomed the planned programme of structural reforms. Budgetary consolidation was identified as the main challenge facing the French Government, following two years of deterioration in public finances mainly due to cyclical factors.
The Council welcomed the efforts of the German Government to achieve convergence, notwithstanding considerable difficulties in the aftermath of German unification. The Council noted the strategy for structural policy and the need for measures to improve the productivity and competitiveness of the German economy and to deal with the distributional questions raised in the unification process. The Council welcomed the determination of the German authorities to achieve fiscal consolidation.
Council decisions were adopted on the capital key for the European Monetary Institute (EMI), on consultation of the EMI on draft national legislation within its field of competence, and on bringing the staff of the EMI within the tax system for staff of Community institutions. The Council also adopted a regulation on details of the excessive deficits procedure under article 104c of the treaty and agreed common positions on draft Council regulations providing definitions relating to the treaty provisions banning monetary financing and privileged access. All these measures are due to take effect from 1 January 1994 at the start of the second stage of economic and monetary union.
The Council reached political agreement on a directive to reinforce the prudential supervision of financial institutions. This will implement a number of recommendations of the Bingham report on the Bank of Credit and Commerce International affair.
There was a brief discussion of issues related to the Edinburgh growth initiative arising from the conclusions of the European Council meeting on 29 October. Ministers confirmed their intention to extend the coverage of the European investment bank temporary lending facility to transport equipment, energy and urban renewal projects. Agreement in principle was reached on the arrangements for the participation of Community institutions in the European investment fund. A proposal to implement the European Council's conclusion on interest rate subsidies for EIB lending to small and medium-sized enterprises was remitted for further consideration by officials.
I drew the Council's attention to the likely costs associated with implementing the urban waste water treatment directive and highlighted this as an example of a 274W decision taken by a specialist Council without paying sufficient regard to the economic or budgetary implications.
There was also a short discussion of the recently published Court of Auditors' report on the 1992 Community budget. After detailed consideration of the report—and the Commission's response—the Council will adopt a recommendation to the European Parliament on granting a discharge to the Commission in respect of the implementation of the 1992 budget, during the Greek presidency in the first half of 1994.
There were no formal votes. The EMU secondary legislation, the Council decision on Community participation in the EIF and the Council conclusions on the convergence programmes of France and Germany were agreed by consensus.