Today, S&D Euro MPs rejected a conservative proposal aiming at transposing austerity and strict fiscal rules – the so-called Fiscal Compact – into the EU treaties during a vote in the economic and monetary affairs committee. The S&Ds called for a revision of the Fiscal Compact rules in favour of socioeconomic upward convergence.

The Fiscal Compact imposes stricter fiscal discipline on the member states of the euro area according to which national budgets must be in balance or in surplus. Should governments deviate from the set budgetary objectives, automatic sanctions would be triggered.

“Once again the EPP and their friends have shown their real faces. They support blind austerity, now as much in the past, against all economic evidence and despite their public statements about true commitment to democratic accountability. We S&Ds firmly believe that any introduction of the fiscal compact into the EU law must be preceded by a revision of its rules in favour of socioeconomic upward convergence. This revision never took place and this is why we rejected the proposal. We cannot accept any automatisms when the lives of European citizens are at stake,” said S&D Group negotiator for the fiscal compact file, Hugues Bayet.

“It is high time Europe turns the page of blind austerity. More austerity and tighter fiscal rules – as the EPP and ALDE propose – are a recipe for financial breakdown and human deprivation. We have witnessed it all before. As history has shown us, more austerity will not lead to economic growth, but will certainly fuel populism and afflict the poorest and most vulnerable,” he added.

“Accusations from the EPP that by voting against this report we are voting against the community method and more democratic accountability are not only false, but also cynical. It is precisely the community method that we are defending by insisting on an assessment and revision of the rules – as foreseen by the Treaty on Stability, Coordination and Growth (TSCG) – before introducing them into EU law, and not the other way around,” stated S&D Group spokesperson on economic and monetary affairs, Pervenche Berès.

“We Socialists and Democrats have for years been fighting for smarter, investment-friendly economic strategies based on sound democratic decisions. Therefore, we have also long reiterated our call to end blind austerity and reform the EMU. Only through an ambitious reform of the EMU, can the Eurozone become more resilient to new crises and achieve sustainability goals. Fiscal responsibility must go hand in hand with solidarity!” she said.