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Troika Task Force Progress

Troika Task Force Progress. Katherine Duffy EU ISG Meeting 17 November 2012. Troika “product development” issues and solution. No clear brief from EU ISG 100 pages written by group, in early draft Too ambitious from zero previous work to final product with comparable information and data

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Troika Task Force Progress

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  1. Troika Task Force Progress Katherine Duffy EU ISG Meeting 17 November 2012

  2. Troika “product development” issues and solution • No clear brief from EU ISG • 100 pages written by group, in early draft • Too ambitious from zero previous work to final product with comparable information and data • New aim: 6 page opinion document on situation in Troika group countries • Focus on implications of cuts and institutional reforms, for poverty, development and EU integration • Good draft by Christmas, for circulation, finalised EU ISG in February 2013

  3. Report format Goal • Inform EAPN, then lobby Structure • Answer 8 questions (Troika group and Katherine) • Preamble on EU policy context? (Amana) • Finish with recommendations (everybody) Question content 1 Why did the “bail-out” states need it? • Banking crisis • Development model • EU, single market and euro entry 2 Is “bail-out” what is actually happening? • Loans at profitable interest • Economic and social conditionality by Commission; ECB; IMF

  4. Question content continued 3Specific impact of Troika intervention programmes? • Note: Fiscal Compact: legal fiscal squeeze & change of sovereignty • But Troika Memoranda of Understanding add: rigid payments schedule; interest on sovereign loans; heavy surveillance; intensity of cuts and institutional reform • Restricts capacity to follow social democratic development path (welfare state etc) 4 What difference to policy options does it make being a member of the Eurozone? • Eurozone cannot devalue currency (Romania and UK can and did) 5 What is the role of the European Commission? • In Troika states, opportunity to impose Single Market, Maastricht, Competition, Services etc. • EU social mandate ignored except social safety net • Is the “better spending group” of creditor EU states behind the Commission? 6 Common and different austerity responses and why? • The scale of the cuts and reforms restricts development options • But there is some scope for internal priorities/ resistance

  5. Question content continued 7 Are we all “in it together”? • Mass of low to middle income people: cuts in income; cuts in social wage; increases in indirect tax • (Class: re-commodification and individualisation of risk) • Vulnerable will suffer most (welfare benefits cuts; job losses; absolute poverty) • Gender: Public service cuts and user charges hit women hardest • Youth: cuts to education & ed. user charges; loss of job opportunities; future pensions • Poor and elderly: user charges, pension cuts and restricted access to health services 8 Likely outcomes for poverty in In the context of Europe 2020 and the AROPE target? • Troika and some others: mass of people will be poorer in 2020 than 2007 • Problems in interpreting employment, unemployment and low work intensity data (definition, rurality, migration, informal economy • AROPE – no recognition of poor’s higher inflation rate of or cuts in social wage

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