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Grand Committee adopted Parliament position on EU financial support mechanisms

Published 5/11/2020 2:00 PM

Grand Committee adopted Parliament position on EU financial support mechanisms

​​On Friday, 8 May, the Grand Committee adopted the Finnish parliament’s position on the negotiations on new financial support mechanisms for the EU, aimed at supporting member states and businesses in the economic downturn caused by the novel coronavirus.

The statement of the committee (in Finnish) concerns the European Investment Bank’s proposal for a guarantee fund, the commission’s proposal for a temporary SURE initiative to prevent unemployment related risk, and changing the conditions of the European Stability Mechanism’s precautionary financial assistance.

Parliament accepted with remarks the Government position. These remarks are included in the Grand Committee’s statement and the statements of the sector committees. The Grand Committee emphasised the constitutional observations of the Constitutional Law Committee as normative for the Government. 

Three dissenting opinions were appended to the Grand Committee’s statement.

The committee noted that the Constitutional Law Committee found the Government’s evaluation of financial risk for Finland to meet the constitutional requirement of precision.

The planned measures are necessary to ensure the fiscal stability of the Eurozone, even though the benefits for Finland of the SURE initiative and the changes to the criteria of the ESM financial support are marginal, the committee states.

The current situation requires securing funding for member states. However, Finland cannot accept measures that would undermine Finland’s budgetary sovereignty or financial standing. Even in exceptional circumstances, countries must still be ​responsible for their own economic policy. Joint and several liability of all member states for debt should not be introduced.

Measures to curtail the economic crisis are exceptions to the Treaties and should thus be temporary, necessary, and contain necessary conditionality as to the use of funds and the debtors’ fitness. Funds must be allocated according to the impact of the crisis, and efficacy of their deployment.

The Grand Committee underlined the Constitutional Law Committee’s observation that the constitutionality of the corona arrangements depend on how they impact on Finland’s total stock of liability.