The week started badly for the European Commission, or more specifically for President Jean-Claude Juncker. In a motion led by extreme right MEPs, Mr Juncker was forced to stand up and defend his credibility not even 1 month after taking office.
The motion of censure comes amid the continuing #LuxLeaks scandal which has revealed the encouragement from certain governments for legal tax evasion measures for multinational companies. If passed by the necessary two thirds majority, the Commission as a body (not just the President) would have been forced to resign.
The vote from MEPs took place at the end of the week with 461 MEPs voting against the motion. Arguably, this became a vote of confidence in the Commission president who received a 10% increase in support from when elected by MEPs back in July with 422 votes in favour.
In amongst the political infighting between MEPs, the Commission had a small matter of a €315 billion investment pledge to present. In his own words, Mr Juncker said “Christmas has come early”, referring to his earlier promise of a package by the end of the year.
With structural reforms and fiscal responsibility being necessary but not sufficient conditions for growth, the Commission is working hard to attract investment in the form of a European Fund for Strategic Investment. Built on a guarantee of € 16 billion from the EU budget, combined with € 5 billion committed by the EIB, the fund, according to the Commission’s experience can generate a multiplier effect of 1:15.
The notion of raising €315 billion from €21 billion is an ambitious pledge and one which many will hold the Commission to account for. Equally important is where the money goes: modernising transport infrastructure, electric cars, hospitals with state of the art equipment and investing in education were mentioned by Mr Juncker. This is more a wish-list at this stage than any concrete pledge.
An important development in the investment package was the potential role for Member States. With no obligatory contribution, except indirectly through the EU budget, Member States can opt to top-up this new fund. Importantly, in assessing Member States’ public finances under the Stability and Growth Pact, the Commission will not count capital contributions to the new fund.
Mr Juncker called strongly for political backing, not politicisation of the plan itself. This in itself is a big ask of the European Parliament and of Member States. With the plan to be presented to heads of government in December, the Commission hopes to have the fund up and running by June 2015.
Pope Francis made reference to the overly bureaucratic image of the EU and called for a united response to the issue of migration.MEPs also received a visit from His Holiness Pope Francis on Tuesday. Not afraid to address the dark clouds currently hanging over the EU, he said “The time has come to promote policies which create employment, but above all there is a need to restore dignity to labour by ensuring proper working conditions.”
In a debate on the employment and social aspects of the Europe 2020 Startegy, Commissioner for Employment and Social Affairs Marianne Thyssen agreed that the strategy had moved away from social targets and left more people at risk of unemployment. In her view, the new investment plan from the Commission would mobilised money to correct these issues. The debate also looked at the mechanisms used in achieving the strategy’s targets such as the European Semester.