Proposition 53K0024

Projet de loi relatif à la participation de l'Etat belge dans la société anonyme European Financial Stability Facility et à l'octroi de la garantie de l'Etat aux instruments financiers émis par cette société.

General information ¶

Submitted by

CD&V Leterme Ⅱ

Submission date

July 20, 2010

Official page

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Status

Adopted

Requirement

Simple

Subjects

European Central Bank euro euro area EU financial instrument financial instrument monetary crisis short-term monetary support public borrowing

Voting ¶

Voted to adopt

Groen CD&V Vooruit Ecolo LE PS | SP ∉ Open Vld N-VA MR

Voted to reject

VB

Abstained from voting

LDD

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Discussion ¶

Oct. 14, 2010 | Plenary session (Chamber of representatives)

Full source

I will try to refresh your memory a little. In fact, the Finance Committee met on July 20th to consider this bill. We first heard the Minister of Finance recall that exceptional measures have been taken to deal with the consequences of the major and global banking crisis.

Greece has received loans from several European countries. It is important to note that it was indispensable to establish, at European level, a more general mechanism capable of coping with all possible crises This will be done by the formation of a new company, to which Belgium will contribute, and by the granting of guarantees on the financing granted by this company.

The Minister recalled that an amount of €60 billion had already been planned within the framework of the IFSM, a mechanism aimed at providing financial assistance to a Member State experiencing serious financial difficulties.

The bill we will discuss aims at adopting a number of definitions related to the establishment of the company and to allow the Belgian State to take a stake in that company, in proportion to the share it holds in the capital of the ECB.

The discussion was attended by several members of the committee: Alain Mathot, Hagen Goyvaerts and Georges Gilkinet. Everyone asked about the scope of this bill, its consequences, especially at the level of our country’s public finances.

The Minister of Finance, who resigned, stressed that he had been asked by the Council of Ministers to ensure that there were no repercussions in the context of the excessive deficit procedure.

If the guarantee should one day be activated as a result of the failure of a State to repay a guaranteed loan, the capital in question would be included in the calculation of debt and interest on that capital would be taken into account in the deficit. Nevertheless, in such a case and as agreed with the European Commission, a separate line would be provided in the calculation of the excessive deficit procedure, as was the case in the context of aid granted to the financial sector in our country. Those amounts would therefore be accounted for separately and out of the excessive deficit procedure.

As regards the evolution of the discussions at European level, the supervisory agreements are being finalised. Approval has been obtained at the ECOFIN Council level and, in the meantime, colleagues know that significant progress has been made at European level in this area.

Therefore, Mr. Speaker, dear colleagues, I conclude by precising that the articles and the entire bill were adopted by 13 votes against 1 and 1 abstentions. I thank you for your attention.

Mr. Speaker, Mr. Minister, Ladies and Gentlemen, today we are going to vote on a very important text for economic stability and, consequently, for economic growth and employment in Europe. It is reassuring to see that, despite the surrounding political immobilism, the government that manages current affairs has nevertheless managed to advance and approve a very crucial text for financial stability in the euro area in particular, and in the European Union in general.

As stated by our rapporteur, Mr. The purpose of the European Fund for Financial Stability (EFSF) is to provide financial assistance in the form of loans or credit lines with conditions to a euro area Member State which would face serious difficulties due to exceptional events beyond its control.

The fund has a total funding of EUR 440 billion for a period limited to three years. But if we also take into account the 60 billion in the European Financial Stabilization Mechanism and the 250 billion that the IMF is willing to put on the table in the event of a financial crisis requiring such intervention, it is in fact 750 billion means that are available to ensure the financial stability of the euro area and prevent speculative movements against the bonds of the Member States.

The added value of this new instrument is multiple. First, the European Financial Stability Fund happily completes the arsenal of financial instruments available to the euro area. During the preparation and conclusion of the Maastricht Treaty, the possibility of a major sovereign debt crisis in the euro area was not considered.

The European Financial Stability Fund shall contribute to ensuring the stability of the euro area and to protect a member state of the euro area against exceptional events that would go beyond its control.

In addition, the Fund establishes a system of solidarity between the countries of the euro area, combined with a system of macroeconomic conditionality such as the IMF. In other words, the State that will eventually receive the assistance of this fund must commit to restore order in its economic affairs and in its macroeconomic balances or imbalances.

The use of a credible conditionality mechanism is therefore essential in order for the intervention of the Fund to be perceived by the financial markets as an element contributing to delivering a solution to the sovereign debt crisis encountered by a difficult Member State and thus avoiding destructive waves of speculation.

Furthermore, the Fund aims to avoid the risks associated with a restructuring of the sovereign debt of the euro area: risk of contagion in the event of a speculative attack on one country of the zone to other countries, distrust of all euro financial assets. It also aims to avoid the risk of losses for European banks that hold significant portfolios of sovereign debt.

The European Financial Stability Fund is a temporary mechanism. It must be accompanied by significant progress in the fiscal and structural policies of the euro area Member States and the European Union.

The creation of this fund must be seen as part of a new economic governance framework aimed at preventing recurrence of crises similar to those known following the misfortunes of Greece and other European countries.

However, it should be noted that the establishment of this Fund should be accompanied by an analysis of options for a long-term system aimed at effectively and sustainably preventing and resolving potential problems related to sovereign debt while relying on the profits of the single currency.

The creation of a permanent solution must avoid generating any moral problem, in particular by involving private lenders to bear part of the cost of debt re-escalation.

The sovereign debt crisis cannot be disconnected from the issue of better regulation of financial markets, greater transparency in the functioning of rating agencies and improved quality and transparency of public statistics. It is not acceptable that a country has been able to provide Eurostat with statistics that do not reflect the reality.

A better European monitoring of the state of the public finances and the implementation of structural reforms is therefore important in anticipating the emergence of a crisis of the Greek type.

The agreement of 9 May last year establishing the European Financial Stability Fund saved the euro from the collapse in extremis – a few hours or minutes or so – and helped to curb the potential effects of the Greek crisis on the government bond markets. However, it must be emphasized that in the medium and long term, only strict budgetary discipline by all member states of the euro area will prevent the repetition of the Greek drama. Strict control of public debt and spending is therefore necessary to ensure monetary cohesion of a group of countries which, while sharing the same currency, are nevertheless not bound by a federal-type economic and political union, as the US states are within the United States.

The crisis that has shaken Greece, but also other eurozone countries – fortunately to a lesser extent – and which has shaken confidence in the euro, obviously cannot be repeated. Several European leaders have unfortunately been deaf to the warnings of the European Central Bank and other economists who have long argued that poorly controlled budget deficits could lead to disasters not only on the financial markets but also in real terms.

Furthermore, it should be emphasized that the establishment of the European Fund for Financial Stability was a preferable solution to an intervention by the European Central Bank in the bond market which, by massively buying out state funds to defend the euro, would likely have revived inflation.

We hope that the negotiators of our next government will know how to take the necessary steps in fiscal matters, so that Belgium remains a good pupil and contributes to the stability of the financial markets and to the economic stability of the euro area.

Mr. Speaker, Mr. Minister, dear colleagues, we are accustomed to the force of things to the current business periods since 2007. It seems that we also need to get used to passing bills during the same regular business periods. I don’t think we can rejoice, it’s not ideal working conditions, but we’ll be content to wait for better.

In this case, the bill that is submitted to us today is not anodin: it obliges our country, in the event of a new speculative attack on one of the member countries of the European Union, in the amount of 15 billion euros of guarantees on a total amount of 500 billion euros that would be paid by the Member States, proportionally to their contribution to the European Central Bank. This is even less absurd as the text also provides that this amount of 15 billion can be adjusted to the increase by simple decision of a government.

The importance of this commitment in budgetary terms and the urgency with which we are asked to ratify it in a still fragile financial and banking context, shortly after this financial crisis that has had such negative consequences on our economy, remind us that it is a luxury to be in crisis today, an even greater luxury to prolong this state of institutional crisis without finding a lasting solution suitable for everyone and respecting everyone. This is why we are helping to find solutions.

This text, therefore, aims to create inter-state solidarity in the event of speculative attacks, such as the one Greece experienced in the spring and of which other countries, including ours, unfortunately, are not safe. This is a good thing, an important initiative that draws some lessons from the financial crisis. That is why we will support it soon. This also goes in the direction of European construction and solidarity of being able to shake up the elbows when a state goes through such difficulties.

That being said, this text is just one of the pieces of the puzzle to build to send back as far as possible the afflictions of a new financial crisis. Fighting the effects of speculation is one thing, fighting speculation itself is another. We expect much more in the case of Europe and Belgium.

Beyond the strengthening of social and economic cohesion, the upward convergence in Europe, what is needed is to set rules that prevent the world of finance from taking the footsteps of democracies, from speculating on the finances of a state – which is unacceptable – to continue to destroy our economies. What is needed is rules that prevent speculators from stealing workers and polluting our planet.

We are desperately waiting for these rules. Where is the text that would create a rating agency truly independent of private interests? Where is this European Tax on Financial Transactions (Tobin Tax) that would have the double merit of curbing speculation and unleashing new means for new public policies or to balance budgets?

When will we really tackle these tax havens where speculators who attack our economies take refuge, including when the banks we have helped have interests there? Will the banking and financial sector be rapidly reformed by separating the banking professions, by reinforcing the prudential rules, by reinforcing the solvency requirements with respect to them?

What tools will we equip with to guide investments towards sustainable development?

All these proposals, we formulated them the day after the financial crisis. In addition, we have submitted a number of legislative proposals that want to implement them. We look forward to their realization.

It is not enough, even if it is useful, to strengthen the gendarmes of the world of finance, to provide tools of response in the event of a speculative attack. We must really address the causes and actors of speculation both at the European and Belgian level. We consider the proposed solutions too weak, too shy, too partial.

This text, like other already adopted at the Belgian level, is only one of those necessary tools that will allow us to act in solidarity in case of emergency (it is in this respect that we will support it), even though I regretted in the Finance Committee the uncomfortable conditions in which it had to be analyzed. But we expect more and better.

We therefore hope that we will be able to discuss as soon as possible, Mr. Minister, these new measures in the field of budgetary governance, sketched at the European level, because they will not be without consequences on the policies developed at the Belgian level, at the level of the federal state as well as federated entities, because they risk to have very harsh social consequences, by generalizing austerity measures and threatening to impose new sanctions on States in difficulty that will only aggravate their problems.

We also hope, and above all, that other texts can soon be put on the agenda of our Finance Committee or the plenary session, parliamentary or governmental initiative, in periods of ordinary affairs or with a full-time government, and whose aim would be to bring to this systemic crisis that has hit us real systemic responses – and not only at the margin or hit by hit.

Following my report, I would like to give you a few brief considerations of a more political nature.

In recent years, we have experienced a global financial and economic crisis that has affected all states. We are aware of the dramatic situation in which Greece, its people and especially its workers are. In a sense, the role of the European Union is to support its partners in difficult times. That is why we felt it primary to react and help this country that was going through a dramatic period.

By helping Greece, it is solidarity that has won – for this country, but also for the whole of Europe. It is essential to contribute to the economic recovery, otherwise the contagion could be felt; which would be even more serious.

Aid to Greece: it was about the future of the European Union and our country in Europe. But the seriousness of the situation was such that it took more than financial aid, we know: Greece was forced to submit to a ⁇ drastic austerity plan to recover from the dramatic crisis that affects it. And workers drink because of unthinkable speculation.

I repeat, with this bill, we have decided to help this country in difficulty. However, we cannot stay there. Through this text that concerns us today, we wish to create a more general device that would allow us to face a set of crises that may still occur.

The aim is, of course, to promote European financial stability, to provide financial assistance to euro area Member States in the form of loans or credit lines. This aid will, of course, be accompanied by strict conditions negotiated by the European Commission. In order to manage the granted aid properly, it will also be accompanied by measures of budgetary discipline and economic policy.

This new bill allows states that would need it, to get out of a crisis through funding. But it will be accompanied by strict conditions so that the countries concerned recover in the long term. Again, I want to reaffirm it, this project is a dedication of solidarity in Europe that the Belgian Presidency is also striving to consolidate. My group will naturally support this bill.

How can we not conclude on a form of misunderstanding? At a time when European solidarity triumphs, let us ask the question in the face of such a dramatic situation for women and men in the European Union: Does the crisis in our country make sense? Everyone will have their own answer, as the previous discussion has shown. We have our own that derives from common sense and the popular will that expressed itself on June 13 last. We need a real government for our country, as quickly as possible to respond to financial, economic and social challenges.

(Tracks are thrown from the tribune)

(From the tribune, pamphlets are thrown)

Mr. Speaker, I would like to thank those who spoke in this debate both in the plenary session and in the committee before the summer. I also thank your assembly for allowing us to join all the European states that have decided to set up this new mechanism.

As you know, we had already intervened in a different form in the Greek case. I would also point out that in this case, we must bear a slightly higher burden than expected, because a European state, Slovakia, has decided not to follow the movement.

In this case, a more fundamental mechanism is established which I will not describe again, given that I had the opportunity to do so in a committee and that the rapporteur presented the main elements. This mechanism is in line with the logic, on the one hand, of fiscal consolidation and, on the other hand, of new governance that is attempted to establish in Europe, in particular through the work of the task force chaired by the permanent President of the Council, Herman Van Rompuy. The European Commission has also made proposals to strengthen governance. We will try to reach conclusions on this subject by the end of the year.

Our European Presidency produces a second draft related to a new European supervision of the financial markets, banks and insurance companies. Thanks to the many discussions with the European Commission, all countries of the European Union and the European Parliament, it was possible to reach an agreement in September on a new organization, a new architecture of financial supervision in Europe. In the coming weeks and months we must develop a new organization in Belgium for the same supervision. A few months ago there was a decision on this. We must continue to implement it.

Dear colleagues, for respect for the speaker, can I ask you to make as little noise as possible?

The speaker is accustomed. Let the Minister continue, please.

Thank you Mr. President. So I said that Belgium will continue on this path, with the translation into our legislation, of the new supervisory model. I hope that we will be able to conclude in the coming weeks or months with a translation of the texts that had been adopted in this assembly a few months ago already.

I would like to further clarify that in the second half of the Belgian presidency, which began at the beginning of this month of October, we will also attempt to complete the work on the directive that tends to extend rules to the Investment Fund, rules already applicable today to the banking sector, for example. I am referring to the AIFM Directive.

Fortunately, the European Parliament has decided to postpone its vote again to early November to give us the opportunity to reach an agreement with the Commission, the 27 Member States and the Parliament.

I heard several comments in this assembly about the need to make progress in the implementation of a number of tools.

I would like to say that the progress, since Belgium holds the Presidency of Europe, is still quite spectacular. I think here about the establishment, I repeat, on the one hand, of this new control architecture, but I think also on the other hand of the progress we are making in extending the regulatory mechanisms, the hedge funds. But there are also a whole series of other investments or private equity funds.

I would like to conclude my speech by pointing out that we are also trying to advance, in this context, a number of debates concerning new resources, at the level of the European Union, and ⁇ even international organisations. This applies in particular to all the discussion on the carbon tax, but also that on the taxation of financial transactions. I am currently turning the groups in the European Parliament to try to convince them to join the Belgian position that wants the introduction of this type of taxation at least at the level of the euro area, or even the Union, if we fail to do so at the international level.

It is not so difficult to reach an agreement with the different political groups in the European Parliament, sometimes with the same political groups, but it is more difficult in the governments in Europe. We will try to reach an agreement with the different governments.

We will try next week at the G20 to start such a discussion. I think it is possible to do something at least at the international level, that is, in the European Union. The Eurozone will be a first step. We will make a lot of effort in this regard.