ECOFIN

George Osborne Excerpts

Monday 9th July 2012 Written Statements

[The Chancellor of the Exchequer (Mr George Osborne)]

The Economic and Financial Affairs Council will be held in Brussels on 10 July 2012. Ministers will discuss the following items:

Economic governance—two pack

Ministers will hold an orientation debate on the “two pack” of economic governance proposals, to discuss the European Parliament’s position. This will inform the first working-level trialogue meeting with the European Parliament on 11 July.

The first proposal concerns strengthening surveillance of budgetary policies in euro area member states. It would require euro area countries to present their draft budgets at the same time each year and give the Commission the right to assess and, if necessary, issue an opinion on them. The second proposal concerns strengthening economic and fiscal surveillance of euro area countries facing or threatened with serious financial instability. It aims to ensure that the surveillance of member states under a financial assistance programme, or facing a serious threat of financial instability, is robust, follows clear procedures and is embedded in EU law.

The UK broadly welcomes these proposals, which will be an important part of governance reforms. The proposals will help improve fiscal stability in the euro area, which is in the UK’s national interest. The euro area must put in place governance arrangements to create confidence for the future and ensure fiscal responsibility.

(possible agenda item.) Revised capital requirements rules (CRD4)

The presidency may update Ministers on the latest trialogue negotiations, following the general approach agreed by Ministers at 15 May ECOFIN. The UK continues to support the full implementation of Basel III and for member states to have sufficient flexibility to increase minimum standards in order to protect financial stability in their jurisdiction.

Proposal for Bank Recovery and Resolution Directive

This item was deferred from the 22 June ECOFIN. The Commission will present its new proposals for a directive, following which Ministers may then have an initial exchange of views. The directive will require member states to ensure that their national supervisory and resolution authorities have a set of common tools and powers which will enable them to avert, and where necessary manage, the failure of a financial institution. The proposal seeks to prevent the systemic damage caused by the disorderly failure of such institutions, limiting public sector exposure and preventing wider economic damage.

Presentation of the Cyprus Presidency Work Programme

The new presidency will set out their work programme for the next six months. Ministers will have an exchange of views on Cyprus’ work programme.

Follow-up to the European Council on 28-29 June 2012

Ministers will discuss the follow-up to the European Council, which considered a paper by the four presidents (of the Council, Eurogroup, ECB and Commission), “Towards a Genuine Economic and Monetary Union” and agreed a “Compact for Growth and Jobs”.

Contributions to the European Council Meeting on 28/29 June 2012—European Semester

The presidency will ask Ministers to adopt Council recommendations on national reform programmes and stability or convergence programmes. The recommendations were endorsed at June European Council. The UK supports the European semester process and the country specific recommendations.