CAN Europe’s contribution to the public consultation on the EU economic governance review

Financing the transition

In October 2021, the European Commission launched the public debate on the review of the EU’s economic governance framework. Citizens, organisations and public authorities are invited to submit their contributions by 31 December 2021.

CAN Europe believes that the reform of the EU economic governance framework should serve the EU goals on climate and environment and a just transformation of our economies, while ensuring sustainable public debts and deficits. There is a strong potential in the upcoming reform to strengthen green budgeting and a socially just phase out of fossil fuel subsidies. It is also an opportunity to take into account climate-related risks to assess public budgets’ sustainability and ensure Member States strictly abide by anti-corruption rules.

The EU rules aiming at limiting Member States’ public debt and budget deficit were suspended during the pandemic, to provide governments with the fiscal space they needed to support their people and their economy. In 2023, these rules will be imposed again and, without a reform, may trigger austerity across the EU. The aim of the public debate is “to build a broad-based consensus on the way forward well in time for 2023”.

Massive cuts in public spending would risk to aggravate inequality and put the European recovery at risk. It would also endanger the just transformation of our economies and societies. The green transition requires massive investments now and the reform of the EU economic governance framework can help us achieve this.