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ECOFIN

Volume 712: debated on Thursday 16 July 2009

Statement

My right honourable friend the Chancellor of the Exchequer (Alistair Darling) has made the following Written Ministerial Statement.

The Economic and Financial Affairs Council was held in Brussels on 7 July 2009. The following items were discussed:

Presentation of the presidency work programme

The council took note of the presentation by the Swedish presidency of the ECOFIN work programme for the second half of 2009.

Follow up to the 18 and 19 June European Council

Financial supervisory framework

The council took stock of the presidency’s strategy for taking forward work on European financial supervision and regulation following the agreement reached at the June ECOFIN and European Council. The UK is supportive of the timetable presented, with legislative proposals expected on 23 September, and will engage fully in the upcoming negotiations to ensure that the legislation is in line with the agreement reached by leaders at the European Council, and in particular that any new powers granted to existing or proposed bodies would not impinge in any way on member states' fiscal responsibilities.

Climate change financing

Ministers also took note of conclusions agreed by Heads at the June European Council on the financing of climate change. The presidency expects an agreement to be reached on a negotiating mandate at a meeting of the European Council in October, when ECOFIN will also revisit this issue. The Government believe that work should continue to ensure the EU reaches agreement on the key issues in advance of the Copenhagen conference in December.

Preparation for the G20 meetings

The UK updated the council on the outcome of a G20 deputies meeting on 27 and 28 June. The presidency informed Ministers of its intentions of the handling of the preparation for further G20 meetings in September, including London meetings of G20 deputies on 3 and 4 September and G20 Finance Ministers and central bank governors on 4 and 5 September. There will be a lunch of EU Finance Ministers to prepare for these on 2 September. The Government will look forward to working closely with the presidency to ensure co-ordination of work taken forward at G20 and EU levels.

Pro-cyclicality

Following a report by the Economic and Financial Committee, ECOFIN adopted council conclusions on pro-cyclical effects on financial markets. The conclusions assess work under way to reduce possible pro-cyclical effects of financial regulation, including on the issue of impaired assets. The UK is content with the conclusions, which represent a positive step forward on this issue, and looks forward to further discussion of the issue in the autumn.

Implementation of the Stability and Growth Pact

Adoption of legal acts in the excessive deficit procedure

ECOFIN adopted council decisions for Latvia, Lithuania, Malta, Poland and Romania, formally entering these countries into the excessive deficit procedure, and issued recommendations on corrective action to be taken. It also issued a revised recommendation to Hungary on measures to be taken in order to correct its excessive deficit.

Adoption of council opinions on updated stability and convergence programmes

The council adopted opinions on the updated stability and convergence programmes of Slovenia, Slovakia, Austria, Belgium and Romania.

Any Other Business

Medium-Term Budgetary Objectives (MTOs) and Implicit Liabilities

The council took note of issues raised by the Slovenian Minister regarding the methodology to be used by member states from this autumn when they set medium-term objectives for their national budgets.