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Recent events have confirmed the urgent need for such a political approach in the European Union.
This is not the time for business as usual.
This is not the time for ticking off lists or checking whether this or that sectorial initiative has found its way into the State of the Union speech.
This is not the time to count how many times the word social, economic or sustainable appears in the State of the Union speech.
Instead, it is time for honesty.
It is time to speak frankly about the big issues facing the European Union.
Because our European Union is not in a good state.
There is not enough Europe in this Union.
And there is not enough Union in this Union.
We have to change this. And we have to change this now.
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A new start for Greece, for the euro area and for the European economy
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Of course, the figures in what is now the third Greek programme had to add up in the end. But we managed to do this with social fairness in mind. I read the Troika report of the European Parliament very thoroughly. I hope you can see that we have drawn the lessons from this, that we have made, for the first time, a social impact assessment of the programme. Even though I admit frankly that the Commission also had to compromise sometimes in these negotiations.
What matters to me, is that, in the end, a compromise was found which could be agreed by all 19 euro area Member States, including Greece.
After weeks of talks, small progress, repeated setbacks, many crisis moments, and often a good dose of drama, we managed to sign a new Stability Support Programme for Greece on 19 August.
Now that the new programme is in place, I want it to be a new start, for Greece and for the euro area as a whole.
Let us be very honest: We are only at the beginning of a new, long journey.
For Greece, the key now is to implement the deal which was agreed. There has to be broad political ownership for this. [...]
The programme is one thing, but it is not enough to put Greece on a path of sustainable growth. The Commission will stand by Greece to make sure the reforms take shape. And we will assist Greece in developing a growth strategy which is Greek owned and Greek led.
From the modernisation of the public administration and the independence of the tax authority, the Commission will provide tailor-made technical assistance, together with the help of European and international partners. This will be the main task of the new Structural Reform Support Service I established in July.
On 15 July, the Commission also put forward a proposal to limit national co-financing in Greece and to frontload funding for investment projects short of liquidity: a €35 billion package for growth. This is urgent for recovery after months of financial squeeze. This is money that will reach the Greek real economy, for businesses and authorities to invest and recruit.
The Commission worked day-in, day-out to put this on the table. National Parliaments met several times throughout the month of August. I therefore hope that the European Parliament will also play its part, in line with previous commitments. Our programme for growth in Greece has been on the table of this House for two months. If adopted, it will still take several weeks until the first euro will reach the real economy of Greece.
I call on you to follow the example of the Council, which will agree on this growth programme by the end of this month. The European Parliament should be at least as fast as the Council on this.
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The crisis is not over. It has just been put on pause.
This is not to say that nothing is happening. Unemployment figures are improving, GDP is rising at its highest rate for years, and the financing conditions of households and companies have recovered significantly. And several Member States once severely affected – like Latvia, Ireland, Spain and Portugal – which received European financial assistance are now steadily growing and consolidating their economies.
This is progress but recovery is too slow, too fragile and too dependent on our external partners.
More fundamentally, the crisis has left us with very wide differences across the euro area and the EU as a whole. It has damaged our growth potential. It has added to the long-term trend of rising inequalities. All this has fuelled doubts about social progress, the value of change and the merits of belonging together.
What we need is to recreate a process of convergence, both between Member States and within societies, with productivity, job creation and social fairness at its core.
We need more Union in our Europe.
For the European Union, and for my Commission in particular, this means two things: first, investing in Europe's sources of jobs and growth, notably in our Single Market; and secondly, completing our Economic and Monetary Union to creating the conditions for a lasting recovery. We are acting on both fronts.
Together with you and the Member States, we brought to life the €315 billion Investment Plan for Europe, with a new European Fund for Strategic Investments (EFSI).
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At the same time as we deploy our Investment Plan, we are upgrading our Single Market to create more opportunities for people and business in all 28 Member States. Thanks to Commission projects such as the Digital Single Market, Capital Markets Union and the Energy Union, we are reducing obstacles to activities cross-border and using the scale of our continent to stimulate innovation, connecting talents and offering a wider choice of products and services.
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This is the essence of the report I presented in June with the other Presidents of the European institutions on the completion of our Economic and Monetary Union.
It was self-evident for me to include President Schulz in this important work. After all, the Parliament is the heart of democracy at EU level, just as national Parliaments are the heart of democracy at national level. The European Parliament is and must remain the Parliament of the euro area. And the European Parliament, in its role as co-legislator, will be in charge of deciding on the new initiatives the Commission will propose in the months to come to deepen our Economic and Monetary Union. I am therefore glad that for the first time, we have written not a ‘Four Presidents' Report’, but a ‘Five Presidents’ Report’. [...]
As we had expected, the Five Presidents’ Report has triggered a lively debate across Europe. Some say we need a government of the euro. Others say we need more discipline and respect of the rules. I agree with both: we need collective responsibility, a greater sense of the common good and full respect and implementation of what is collectively agreed. But I do not agree this should mean the multiplication of institutions or putting the euro on auto pilot, as if new institutions or magic rules could deliver more or better.
You cannot run a single currency on the basis of rules and statistics alone. It needs constant political assessment, as the basis of new economic, fiscal and social policy choices.
The Five Presidents' Report includes a full agenda of work for the years to come, and I want us to move swiftly on all fronts – economic, financial, fiscal and political Union. Some efforts will have to be focused on the euro area, while others should be open to all 28 Member States, in view of their close interaction with our Single Market.
Allow me to highlight five domains where the Commission will present ambitious proposals swiftly and where we will be expecting progress already this autumn.
First: the Five Presidents agreed that we need a common system to ensure that citizens' bank savings are always protected up to a limit of €100,000 per person and account. This is the missing part of our Banking Union. [...]
Second: we need a stronger representation of the euro on the global scene. How is it possible that the euro area, which has the second largest currency in the world, can still not speak with one voice on economic matters in international financial institutions? [...]
Third: we need a more effective and more democratic system of economic and fiscal surveillance. I want this Parliament, national Parliaments, as well as social partners at all levels, to be key actors in the process. I also want the interest of the euro area as a whole to be better reflected upfront in EU and national policies: the interest of the whole is not just the sum of its parts. This will be reflected in our proposals to streamline and strengthen the European Semester of economic policy coordination further. [...]
Fourth: we need to enhance fairness in our taxation policies. This requires greater transparency and equity, for citizens and companies. We presented an Action Plan in June, the gist of which is the following: the country where a company generates its profits must also be the country of taxation. [...]
Fifth: We have to step up the work for a fair and truly pan-European labour market. Fairness in this context means promoting and safeguarding the free movement of citizens as a fundamental right of our Union, while avoiding cases of abuses and risks of social dumping. [...]
As said in the Five Presidents’ Report, we will also need to look ahead at more fundamental steps with regard to the euro area. The Commission will present a White Paper on this in spring 2017.
Yes, we will need to set up a Euro Area Treasury over time, which is accountable at European level. And I believe it should be built on the European Stability Mechanism we created during the crisis, which has, with a potential credit volume of €500 billion, a firepower that is as important as the one of the IMF. The ESM should progressively assume a broader macroeconomic stabilisation function to better deal with shocks that cannot be managed at the national level alone. We will prepare the ground for this to happen in the second half of this mandate. [...]
A fair deal for Britain
Since I took office, things have become clearer as regards the United Kingdom: before the end of 2017, there will be a referendum on whether Britain remains in the Union or not. This will of course be a decision for voters in the United Kingdom. But it would not be honest nor realistic to say that this decision will not be of strategic importance for the Union as a whole.
I have always said that I want the UK to stay in the European Union. And that I want to work together with the British government on a fair deal for Britain.
The British are asking fundamental questions to and of the EU. Whether the EU delivers prosperity for its citizens. Whether the action of the EU concentrates on areas where it can deliver results. Whether the EU is open to the rest of the world.
These are questions to which the EU has answers, and not just for the sake of the UK. All 28 EU Member States want the EU to be modern and focused for the benefit of all its citizens. We all agree that the EU must adapt and change in view of the major challenges and crisis we are facing at the moment. [...]
To be fair to the UK, part of this deal will be to recognise the reality that not all Member States participate in all areas of EU policy. Special Protocols define the position of the UK, for instance in relation to the euro and to Justice and Home Affairs. To be fair to the other Member States, the UK's choices must not prevent them from further integration where they see fit.
I will seek a fair deal for Britain. I will do this for one reason and one reason alone: because I believe that the EU is better with Britain in it and that Britain is better within the EU.
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