Wywiad dla Agencji "Europolitics"

INTERVIEW WITH DANUTA HÜBNER, MEMBER OF EP'S CRIS COMMITTEE : BALANCING BUDGETS AND GROWTH: REGIONAL POLICY PART OF SOLUTION Polish MEP and ex-Regional Policy Commissioner Danuta Hübner has just penned her contribution to a major report on getting Europe out of the crisis, which should be approved by MEPs later this year. Here, the EPP deputy - who is a member of the European Parliament's Special Committee on the Financial, Economic and Social Crisis (CRIS) - tells Europolitics how regional funds can help to lift member states out of the debt trap. What are the biggest hurdles facing Europe as a result of the crisis? We have been focusing very strongly up to now on financial sector reform, which is extremely important, but there was a delay in starting to discuss the major issue, which is how to get Europe out of the crisis in the real economy. If we want to get rid of debts and deficits, we need growth. Consolidation should not undermine growth and lead to another recession. It is quite unlikely that we will have more money in public budgets either at EU or national level, so we all face the challenge of increasing the efficiency of public spending. It is also most likely that the old leaders, the pre-crisis leading companies, regions and cities might not be leading the exit from the crisis. There might be a new regional map of Europe once the dust of the crisis has settled and that will have to be taken into account in any public support. We can and should use European regional policy, which provides substantial funding to all member states, to get out of the crisis and to support long-term growth. All projects financed by the structural funds are invested in a pattern of growth which is line with Europe 2020' - a smart, knowledge-based economy. Do you think the 2020 strategy will make a difference or is it just Lisbon mark II? It's true that it's not very innovative in terms of its major objectives because it just goes along the same lines that we already know. But Europe 2020' is not a simple continuation of where we started. Everything is more difficult, more challenging, and in this sense it is an important strategy - if we manage to take it seriously, to mobilise ourselves and identify the machinery to deliver on it. To have a soft delivery mechanism - the open method of coordination - will take us a few steps on the road to a competitive European economy, but it certainly will not take us all the way forward. Part of the solution lies with regional policy because we can earmark it for the future. We can demand from beneficiaries that they pursue European objectives and there is conditionality - you distribute funding based on negotiated programmes, which prioritise European objectives. We also have this system of monitoring, of sanctioning - taking money back if things are not done in line with the conditionality. I continue to be very strongly convinced that European regional policy has to be involved or harnessed as an important delivery mechanism for Europe 2020'. Do you support the idea of suspending Cohesion Funds for states that break EU rules? People forget that in the Cohesion Funds we have an article that allows for suspension when the Stability and Growth Pact requirements are not respected, but this is limited to those member states that are beneficiaries - the new member states, Spain, Portugal and Greece. I am against this approach because it wouldn't give the feeling that it's a fair treatment of all the member states. Secondly, we also have to remember that sanctioning would come to a country that is suffering from a lack of public funding, and if you take European funding away it would worsen the situation. We have to think of sanctions that would not kill the objective of sanctioning in the first place and make it more difficult to get out of debt. Does the political will exist to accept more Commission scrutiny, or will economic governance rest with the Council? I'm very much in favour of the enhanced role of the Commission in this system, and not a type of intergovernmental secretariat. This is a chance to improve efficiency. The Stability and Growth Pact did not deliver and we have to understand why. If we think of how politicised the excessive deficit procedure was, we can see that we need a lot more automaticity - it's impossible to be able to just vote on whether there is a lack of discipline or not. There has to be some form of centralisation. Is it right to focus on austerity, and where will economic growth come from when public funding is cut? We are facing a major challenge. What we need now is both growth and consolidation, but there are no ready-made recipes we can use in economic theory. We don't have a private sector that can take over from the public sector to support investment. Financial regulation will not immediately lead to the resumption of lending - many banks will need recapitalisation, reprivatisation, internal restructuring and governance changes to rebuild confidence. And there will be a lot of high-risk activity in the business sector if we move to an innovative economy - all this will require venture capital and guarantees. There is a lot of adjustment that might delay growth. And this is in the context of the risks coming from similar austerity packages across the world. The global economy can be hit again and we can get into a second recession. What we need is much more attention and effort dedicated to the design of long-term development plans, balanced in such a way that we can gradually get out of debt and reduce deficits at a speed in which the private sector would take over investment. This will not happen overnight or automatically, it will have to be planned. And we clearly have different situations in different countries. We cannot have a one size fits all' policy. What role can the CRIS committee have in designing new policies? In the Parliament we don't have a horizontal committee that would allow us to take on all the aspects of the changes we need to cope with the crisis and the post-crisis world. We have individual sectors treated by different committees, and ECON has been overwhelmed by macro-financial regulation over the last year. We don't have a committee that would deal with growth. We don't even have a committee that would take care of Europe 2020'. We in the CRIS are able to link the crisis exit with long-term growth. We can act and have impact through hearings. The right balance between consolidation and growth requirements in Europe, and also 2020 as an integrated development strategy, could go to the CRIS committee for debates, discussion and monitoring. By Sarah Collins