Economic crisis
The European Parliament's response to the financial crisis.
The speed and depth of the financial crisis has been brutal and over
the last year MEPs have been hard at work on a two-fold approach to the
crisis: first, by introducing a clearer European regulatory system with
more banking supervision, and second, by trying to mitigate the effects
of the recession on peoples' lives.
Tighter bank supervision, stricter credit rules
In October, a few weeks after the full outbreak of the crisis in Europe, MEPs told the EU's executive, the European Commission, that they wanted new legislation to improve the supervision and regulation of financial services in Europe. Concrete results were approved in April and May and include:
• the Capital Requirements Directive, which sets down new rules to increase transparency, improve supervision and ensure proper risk management for banks.
• the Solvency II Directive creates new rules for the supervision of insurance companies, by introducing more sophisticated solvency requirements.
• stricter rules for credit rating agencies which should improve the transparency and independence of European credit rating.
MEPs have also backed measures to help combat rising unemployment:
• they agreed to widen the scope of the "Globalisation Adjustment Fund" to help workers who lose jobs because of the crisis
• they backed full rights for temporary workers full rights from day 1
• they widened the scope of vocational training and education
• MEPs also backed a maximum average 48 hour working week, with no opt outs, however they couldn't reach agreement with ministers, so the existing rules, including an opt out allowing UK workers to work longer hours, remains in place.
Other measures
MEPs also backed a series of other proposals to bolster economies during the crisis:
Parliament twice agreed to raise the ceiling for loans to EU countries that are not in the eurozone and which are more exposed to the impact of the downturn, to €25 billion in November from €12 billion and then to €50 billion in April.
In December they broadly backed the €200 billion financial stimulus package.
Also in December, they also agreed to increase bank deposit guarantees - so if a European bank fails, citizens' savings should be guaranteed up to €100,000.
Parliament is also calling for the Small Business Act to be made legally binding and wants a uniform statute for the European private company.
The majority of MEPs welcomed the result of the G20 summit in London, which agreed $1.1 trillion to encourage economic stability and a recovery in international finance, credit and trade, as well as to strengthen regulation of financial markets. But they also called on world leaders to agree on the closure of all tax and regulatory havens and regulatory loopholes.
Tighter bank supervision, stricter credit rules
In October, a few weeks after the full outbreak of the crisis in Europe, MEPs told the EU's executive, the European Commission, that they wanted new legislation to improve the supervision and regulation of financial services in Europe. Concrete results were approved in April and May and include:
• the Capital Requirements Directive, which sets down new rules to increase transparency, improve supervision and ensure proper risk management for banks.
• the Solvency II Directive creates new rules for the supervision of insurance companies, by introducing more sophisticated solvency requirements.
• stricter rules for credit rating agencies which should improve the transparency and independence of European credit rating.
MEPs have also backed measures to help combat rising unemployment:
• they agreed to widen the scope of the "Globalisation Adjustment Fund" to help workers who lose jobs because of the crisis
• they backed full rights for temporary workers full rights from day 1
• they widened the scope of vocational training and education
• MEPs also backed a maximum average 48 hour working week, with no opt outs, however they couldn't reach agreement with ministers, so the existing rules, including an opt out allowing UK workers to work longer hours, remains in place.
Other measures
MEPs also backed a series of other proposals to bolster economies during the crisis:
Parliament twice agreed to raise the ceiling for loans to EU countries that are not in the eurozone and which are more exposed to the impact of the downturn, to €25 billion in November from €12 billion and then to €50 billion in April.
In December they broadly backed the €200 billion financial stimulus package.
Also in December, they also agreed to increase bank deposit guarantees - so if a European bank fails, citizens' savings should be guaranteed up to €100,000.
Parliament is also calling for the Small Business Act to be made legally binding and wants a uniform statute for the European private company.
The majority of MEPs welcomed the result of the G20 summit in London, which agreed $1.1 trillion to encourage economic stability and a recovery in international finance, credit and trade, as well as to strengthen regulation of financial markets. But they also called on world leaders to agree on the closure of all tax and regulatory havens and regulatory loopholes.
