As has been well documented, the latest version of the “Rompuy Reports”, drawn up by Council President Herman Van Rompuy, ECB boss Mario Draghi, Eurogroup boss Jean-Claude Juncker and Commission President José Manuel Barroso, served as a discussion paper for the meeting of the Heads of State and Government at the end of last week. Hence, it was even more important for the European Parliament to add its voice to the discussion on the future of Europe in this important phase. The “Thyssen Report”, named after the conservative Belgian rapporteur, was adopted by the Committee on Economic and Monetary Affairs at the beginning of last week. However, the final position of the Parliament must first be decided by the plenum of the European Parliament.

The ideas of the Parliament on the fiscal union

In the “Thyssen Report”, the European Parliament clearly comes out in favour of a European debt repayment fund. This shall make available low-interest financing for Member States and enable the repayment of previous debts. According to MEPs, making use of the joint debt repayment fund shall be linked to strict conditions. Here, the proposal of the Parliament goes a step further than the “Rompuy Paper”. The four presidents only speak of short-term joint financing instruments.

The Committee on Economic and Monetary Affairs also strongly criticises that the “Rompuy Paper” does not propose any tax-related measures to address tax dumping. The demand goes towards increased cooperation and integration to enable more measures.

Socio-political aspects

There is also no sign of any socio-political measures in the discussion paper of Herman Van Rompuy, Mario Draghi, Jean-Claude Juncker and José Manuel Barroso. Nor is there any mention of the 2020 Targets, which were adopted for the entire EU. The “EU 2020 Targets” are the five core areas adopted in 2010, where the European Union intends to make progress: Education; Research, Development and Innovation; Climate Change and Energy; Education and Poverty and Social Exclusion. The MEPs of the Committee on Economic and Monetary Affairs demand that the “Thyssen Report” includes the binding compliance with these targets. Sven Giegold, Green MEP in the Committee hopes that by taking the EU 2020 Targets into account, “the negative impact of the austerity policy” will be limited. In addition, the Committee on Economic and Monetary Affairs uses its report to support a “European Social Pact” as well as a European Employment and Training Guarantee for young people following the example of the Austrian model.

Economic Governance and democratic demands

Apart from that, the “Rompuy Report” proposes to implement binding treaties to oblige the Member States to adopt reform measures. Until now, treaties of this kind have only been requested in a “Memorandum of Understanding” of Member States that asked for financial aid. MEPs criticised that these mandatory reform measures have no democratic legitimacy and reject this proposal in its entirety. Only financial incentives for Member States keen on reforms should be envisaged.

The point of democratic legitimacy and accountability is also not given much prominence in the “Rompuy Report”. Strengthening the European Parliament is also only mentioned briefly. The “Thyssen Report” includes far-reaching demands concerning this matter. Not only the European Parliament and the national Parliaments shall be strengthened; the role of the European Court of Justice and the EU Anti-Fraud Office OLAF shall be enhanced. The option of reviews and assessment shall in particular be possible when the European Financial Stability Facility EFSF and European Stability Mechanism ESM rescue packages are applied.

The “Thyssen Report” is without a doubt a strong signal. The European Parliament uses it to join a discussion from which so far it has been excluded, as the President of the European Parliament was not involved in preparing the “Rompuy Reports”. Hence, clear positions of the Parliament are even more important. Due to the fact that the “Thyssen Report” represents a compromise between the factions, not all MEPs are fully satisfied.