Economic austerity policies and their effects on EU unemployment

31 March 2015
Question for written answer
to the Commission
Rule 130
Notis Marias (ECR)

In May 2012 there were 4 960 000 job seekers across all categories in France. By February 2015, the figure stood at a record 5 918 000.

After five years of austerity policies, unemployment in Greece has risen from 9% in 2009 to over 26% in December 2014 (51.2% among the 15 — 24 age group).

Backed by the European Commission, the French and Greek governments are following policies of economic austerity. These lead to higher unemployment and leave the peoples of Europe worse off.

Does the Commission admit that the policies of economic austerity in question, in France, Greece, and Europe-wide are ineffective, because they increase unemployment and poverty?

What new lines of approach does it intend to adopt in economic policies, so that they lead to job creation and truly work in the interest of the peoples of Europe?

Source: European Parliament

Answer given by Mr Moscovici on behalf of the Commission
The EU has come through the worst financial and economic crisis in generations, and has created the foundations for more sound and sustainable growth in the future. After several years of fiscal consolidation necessitated by acute concerns over debt sustainability and the threat to the functioning of Economic and Monetary Union, the aggregate fiscal stance in the euro area and the EU as a whole was broadly neutral in 2014 and is anticipated to remain so in 2015.

As acknowledged in the Commission’s 2015 Annual Growth Survey, the risk of persistent high unemployment has become a primary concern. The impact of the crisis has not only been cyclical, as highlighted by the weakness in aggregate demand, but also has had a significant structural component which has lowered the growth potential of EU economies.

To make the ongoing recovery sustainable, and thus tackle the high level of unemployment, the Commission has proposed an integrated approach that relies on three pillars. First, a coordinated boost to investment, which could be achieved by re-orienting public expenditure towards more growth-enhancing investment and by swiftly implementing the Investment Plan for Europe. Second, a renewed commitment to growth-enhancing structural reforms that increase productivity and foster investment. Third, the continued pursuit of fiscal responsibility, whereby Member States with fiscal space foster productive investment as those with large deficits and debt consolidate.

Source: European Parliament

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