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ECOFIN (13 March 2012)

Volume 542: debated on Friday 23 March 2012

The Economic and Financial Affairs Council was held in Brussels on 13 March 2012. Ministers discussed the following items:

Financial Transaction Tax (FTT)—State of Play

The presidency presented a state of play note that listed a number of open issues that remained with the FTT proposals following the completion of the first technical reading. Ministers discussed these issues and agreed that more technical work and supplementary analysis by the Commission, including looking at possible alternatives, was necessary ahead of an orientation debate later in the Danish presidency. I reiterated that the UK position of opposition to the Commission proposals for an FTT remained unchanged.

Reinforcing and Deepening fiscal surveillance on Greece

The presidency introduced a recommendation for a Council decision addressed to Greece with a view to reinforcing and deepening fiscal surveillance and giving notice to Greece to take further measures judged necessary to remedy their excessive deficit. This recommendation was adopted by the Council.

Alert Mechanism Report

Ministers agreed Council conclusions on the Alert Mechanism Report. The Alert Mechanism Report is part of the new macro-economic imbalances procedure. The Commission will now begin finalising the in-depth reviews for those countries flagged as potentially being at risk of having or developing imbalances.

Follow-up to the European Council Meeting of 1-2 March 2012

The presidency briefly reminded Ministers of the March European Council conclusions and stressed the importance of translating those conclusions into action ahead of the June European Council.

Read Out from G20 Meeting of Finance Ministers and Governors (Mexico 25-26 February 2012)

The presidency briefly summarised the discussions at the G20 Finance Ministers’ meeting. The Commission noted that there seemed to be moderate optimism on the euro area position, although significant challenges remain. The Commission and European Central Bank also noted the importance of agreeing on reinforcement of euro area firewalls.

Implementation of the Stability and Growth Pact (Hungary)

The Commission presented a proposal to suspend €495 million of cohesion fund (CF) commitments to Hungary in 2013, following the Council decision on 24 January that Hungary has not taken effective action to sustainably correct its excessive Government deficit. After an extended discussion between Ministers, the proposal was adopted by the Council. Hungary was willing to accept the decision in the light of a statement in the minutes of the meeting making clear that Council would return to the matter at its meeting on 22 June, with a view to lifting the suspension if Hungary undertakes the necessary corrective measures. The Commission also presented a recommendation on measures to be taken to bring an end to the situation of excessive Government deficit in Hungary. This was agreed by Ministers.

Any Other Business: Informal ECOFIN

The presidency looked forward to the forthcoming informal ECOFIN in Copenhagen on the 30 and 31 March and set out some possible items for discussion, including the relationship and co-operation between the euro area and the EU as a whole.

Any Other Business: Discharge Procedure

The presidency debriefed the Council on the presentation to the Parliament on the 28 February of the Council’s recommendations on the discharge for the 2010 budget.

Eurogroup debrief

Ministers were debriefed over breakfast on the Eurogroup meeting of 12 March which had discussed the economic situation and the progress on deficit and debt sustainability efforts being made by a number of euro area member states. Informal consultations had also taken place over appointments to the European Central Bank board, head of the Eurogroup and head of the European stability mechanism (ESM).

European Bank for Reconstruction and Development (EBRD) President

Ministers discussed the forthcoming election of a new president for the EBRD. Two candidates had already been nominated, including the incumbent, and in the course of the discussion Poland confirmed they would be putting forward a candidate. I also informed ECOFIN that the UK would be putting a candidate forward. The Chancellor has since nominated Sir Suma Chakrabarti as the UK candidate.