Ministers delay decision on austerity rules after protest

EU finance ministers have today delayed a decision on new budget rules which would require at least 45 billion Euro in cuts next year.

The Economic and Financial Affairs Council was expected to conclude a deal that would require 14 member states (see table in notes) with a deficit above 3% of GDP to reduce their deficit by a minimum of 0.5% of GDP every year.

However, ministers have instead decided to remain at the negotiating table.

The decision follows a 20,000-strong trade union demonstration against new austerity rules in Paris on Friday. The ETUC also wrote to ministers ahead of the meeting to call on them to rethink the proposal.

European Trade Union Confederation General Secretary Esther Lynch said:

“Ministers need to rethink rules that would require 45 billion in cuts next year alone, and make much-needed investments for the green and digital transitions a mirage.

“That would kill jobs and lower wages, push the economy towards another recession and ensure Europe can’t meet its own targets for investment in a green economy.

“Leaders must listen to the growing concern about a return to austerity that was clear for all to see on the streets of Paris on Friday.

“Any reform of Europe’s economic rules must ensure that they are based on the needs of people and the future of the planet rather than arbitrary targets based on thinking from the 1980s.

“The suspension of the Stability and Growth Pact should be extended by an additional year in order to give proper time for the consideration of the consequences of and alternatives to a return to austerity.”

Notes