Strasbourg, 22.05.2012 – Adopting a report on “Austerity measures – a danger for democracy and social rights”, prepared by Andrej Hunko (Germany, UEL), the PACE Committee on Social Affairs, Health and Sustainable Development said it was concerned that the restrictive approaches currently pursued may not reach their objective of consolidating budgets, but risk further deepening the crisis and undermining the social rights as they mainly affect lower income classes and the most vulnerable categories of the population.
It therefore recommends a profound re-orientation of current austerity programmes, ending their quasi-exclusive focus on expenditure cuts in social areas such as pensions, health services or family benefits. The European social model and its various national expressions should be protected as a common European vision and the welfare state should be further strengthened, the committee said.
Public revenues should be increased by taxing higher income categories and property wealth more strongly, by shoring up the tax base and by enhancing tax collection, the efficiency of the tax administration and the fight against tax fraud and evasion and tax havens, corruption and underground economies.
When it comes to decisions linked to the sovereign debt crisis and possible joint European action, national governments, other national democratically-legitimate institutions, in particular parliaments, should preserve maximum possible discretion, the committee stressed.
At the same time, the long-term question of balancing public finances has to be disconnected from financial markets and their short-term interests, the committee said. Efforts should be pursued to increase the regulation of the financial sector and new taxes on certain types of financial transactions across Europe examined. Finally, the committee said that the prohibition of monetary financing of states by the European Central Bank should be discussed.
The report will be discussed at the PACE plenary session in Strasbourg (25-29 June).