2014 European Semester: Commission has published the Country-Specific Recommendations

The European Commission’s proposals on Country-specific Recommendations were out this Monday 02/06/2014. The overall message is that economic progress is being made. With growth returning and public finances improving, arguing that the medicine of austerity has worked. However, there is a recognition of the big challenges of unemployment, and rising poverty and social exclusion, affecting nearly 1 in 4 of the EU population, with fairness consideration coming to the fore. The key criteria are the AGS priorities, and the previous CSRs – but there is little consistent reference to the Europe 2020 targets, including climate/resource efficiency.

  • 26 MS get CSRs except Greece and Cyprus who are subject to Troika arrangements. Ireland and Portugal, with Spain will be subject to ‘’post-programme surveillance (PPS), ie continued involvement of ECB and the Commission.
  • A first mention is made of the employment and social scoreboard, (social dimension of the EMU) drawing attention to growing youth unemployment, poverty and social exclusion, but not inequality – with an important focus on long-term unemployment, and also supposedly on quality jobs (Bulgaria, Germany, Estonia, Ireland, Greece, Italy,  Malta and Poland), and on wages – with calls for minimum wages in Bulgaria, Romania, Slovenia, Portugal, Germany and France. However pressure to reduce wages (ie attacks to wage-indexation systems) are also proposed to Luxembourg and Belgium.

CSRs on poverty are supposedly given in 11 countries: Bulgaria, Denmark, Croatia, Hungary, Ireland, Italy, Lithuania, Latvia, Poland, Portugal and UK.

  • Some more focus on the adequacy and design of unemployment benefits and social assistance (minimum income) – in Bulgaria, Croatia, Hungary, Italy, Latvia and Lithuania, Portugal and Romania.
  • A big priority to implementing the Youth Guarantee – with CSRs to Spain, Italy, Slovakia, Croatia, Portugal, Poland, Bulgaria, Ireland.
  • However, a major focus remains on reducing deficits. Though, the Commission has reduced the number of countries facing Excessive Deficit Procedures for breaching the 3% of GDP limit (ie taking out Austria, Belgium, Czech Republic, Denmark, Netherlands and Slovakia) and taken Poland and Croatia off the priority list).
  • A stronger focus is given to CSRs on Tax: – reducing the tax burden on labour towards ‘’less distortive’’ consumption, property and pollution taxes (Austria, Belgium, Czech Republic, France, Germany, Hungary, Italy, Latvia, Lithuania, Netherlands, Romania and Spain). Other CSRs are made on broadening the tax base – but many are on reviewing VAT exemptions which may be highly regressive. CSRs on tax governance.
  • On pensions and healthcare, the CSRs continue to press for raising the pensionable age and closing the financial gap in Austria, Belgium, Bulgaria, Croatia, Czech Republic, Finland, Lithuania, Luxembourg, Malta, Netherlands and Slovenia, which may increase poverty for older people.
  • In terms of growth – the major focus is on liberalisation/ and deepening the internal market on Services, with assumptions of a positive impact on pricing and consumer access.

You can find all the information here. This page includes:

  • The Communication, Press Release, frequently asked questions (particularly useful for a summary of the CSRs) as well as the budgetary decisions regarding steps under the Excessive Deficit Procedure.
  • Followed by a section by country of the  CSRs, with the background Commission Staff Working Paper providing important information.
  • See below a brief overview of the proposals, taken from the Commission’s summary which we provided for our members which you may find useful.

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