As the European Parliament moves towards summer recess, and Members move into holiday mode - its a good moment to look back over the past six months to understand why politicians feel relieved that they have survived the unexpectedly tumultuous times through which they have lived (next week’s blog will be looking at the key priorities emerging for the period up to the end of the year). My comments will refer to activities at home, in the EU and internationally.
At Home…Coalition Government hard at work
We have witnessed extraordinary events in the past couple of months. No one would have predicted during the General Election campaign that we would see a coalition government agreed between the Conservatives and Liberal Democrats - the first in Britain for 65 years. Not only does the coalition appear to be wholly focussed on the huge economic and financial challenges the country faces: but it gives the impression that this is not simply a marriage of convenience but a firmly built linkage which will last because its based on a similar outlook to the challenges ahead (see ‘David Cameron and Nick Clegg : We’ll transform Britain by giving power away’)
The measure of their success is the remarkably rapid action taken to reduce the deficit which appears to still have majority acceptance across the country.
The European Union: New personalities and structures in place
At the turn of the year, there was a new European Parliament in place but no equal stability in the European Commission. All Commissioners are now up and running, beginning to put out new ideas on a wide variety of policy areas, for example on the digital agenda. At the tenth anniversary of the European Internet Foundation (see here), Commissioner Kroes came to appeal to us to work with her on no less than 100 proposals to shape up Europe to be competitive in the Digital World of the 21st Century.
In recent weeks, the new External Action Service, provided for in the Lisbon Treaty, is now in place and we have a new President of the European Council, Herman Van Rompuy, looking to implement an agreed strategy for ’smart, sustainable and inclusive growth’ by 2020.
International: Financial and Economic instability and uncertainty
These changes at home and the rest of the EU have taken place in the context of huge financial upheavals as the effects of the global financial and economic crises of the last years continue to be felt. Much of the focus of the uncertainty has tested the viability of the Euro to the limit with particular pressures on Greece (see FT Brussels Blog for more).
No Member State has escaped the need to introduce austerity measures: the UK has taken the first step towards implementing the most wide-ranging budget cuts in a generation with savings of £6.2bn (€7.2bn) planned for 2010-2011, while Germany has committed to cut spending by £70 billion (€80billion) over four years, France has announced plans to cut spending by £40 billion (€45billion)) over three years and the Italian government has approved austerity measures worth £20 billion (€24billion) over the next two years. In this light, I have called for a budget freeze in the EU (see here).
There are still some substantial reasons to fear that we are not yet out of the woods even if Europe may be putting its house in order. For example, there are currently no signs of an uplift in the US housing market and the developed world is truly reliant on ongoing double-digit growth in India and China to provide an outlet for consumer products. More of this international focus in next week’s blog.
If it can be said that we’ve steadied the ship, we must now trim our sails and catch the prevailing winds to ensure we engage in the global challenges ahead.
