Six Pack or “Goodbye Economic Sovereignty”

In its 2nd September Plenary session, the European parliament approved what is termed the “6 pack”. What is it and what does it mean and do?

The so-called “six pack” are six linked measures which extend and reinforce economic governance: in short, they represent a massive increase in the ability of the undemocratic EU to tell the member states, especially those in the Euro zone, how to run their economies and to interfere and punish behaviour the generally faceless and unelected bureaucrats do not like.

It builds upon and gives teeth to the Stability & Growth Pact (SGP):

• A new directive on national budgetary frameworks requires member states to achieve set fiscal standards and to report on how their budget plans conform with their Medium Term Objectives (MTO) set as part of their Stability or Convergence Programmes (SCP)

• In doing so, member states must guarantee transparency which means they have to provide detailed budgetary information and guarantee its accuracy.

• This information is assessed against a ‘scoreboard’ of indicators which are in turn used to provide an early warning system which flags up the need for preventive and corrective action under a new Excessive Imbalance Procedure (EIP). Once a member state is placed in EIP, it has to submit a corrective action plan with performance deadlines.

• The excessive deficit procedure (EDP) requires member states to keep deficits below 3% of GDP and government debt below 60%. Failure to perform or make progress to these targets causes the member state to be placed in “EDP”.

• Once placed in EDP. Euro-zone countries can be required to pay a non-interest bearing deposit of 0.2% of GDP. On a recommendation by the Commission, with limited Council powers to block it, this can be converted into a fine which can be increased for repeat offences

• Sufficient repeat offences can cause the fine to be as much as 1% of GDP.

Though it is all written in the most complicated, jargon-laden language, the bottom line seems to me this. Member states will:
– be set economic, budgetary and fiscal targets
– report on performance against those targets
– be told what action they have to take if they fail to meet those targets
– fined for non-performance.

Clearly in these circumstances, the freedom of action of the member state government has disappeared and the views of the electorate are irrelevant!
Moreover the complicity of Cameron’s government in this diminution of democracy and destruction of economic independence is exemplified by the fact that the ‘Rapporteur’, the MEP responsible for one of the six reports is Vicky Ford, one of his British Conservative MEPs for the eastern region.

The Cameron government’s complicity and culpability in the progressing stripping of real power from Westminster and its transference to largely unelected officials in Brussels has never been clearer.

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