Germany

VII - Six-Pack

The ‘Six-Pack’ is a package of six legislative measures (five regulations and one directive) improving the Economic governance in the EU. The Commission made the original proposals in September 2010. After negotiations between the Council and the European Parliament, the package was adopted in November 2011 and entered into force on December 13, 2011. Part of the ‘Six-Pack’ measures applies only to the Eurozone member states (see the individual titles below).
The ‘Six-Pack’ measures reinforce the Stability and Growth Pact (SGP), among others by introducing a new Macroeconomic Imbalances Procedure, new sanctions (for Eurozone member states) and reversed qualified majority voting. Also, there is more attention for the debt-criterion.               
(http://ec.europa.eu/economy_finance/economic_governance/index_en.htm)

Negotiation
VII.1
What positions did Germany adopt in the negotiation of the ‘Six-Pack’, in particular in relation to the implications of the ‘Six-Pack’ for (budgetary) sovereignty, constitutional law
, socio-economic fundamental rights, and the budgetary process?

No positions known.

 

Directive 2011/85/EU       
Council Directive 2011/85/EU of 8 November 2011 on requirements for budgetary frameworks of the Member States

Implementation
VII.2
What measures are being taken to implement Directive 2011/85/EU on requirements for budgetary frameworks (required before 31 December 2013, article 15 Directive 2011/85/EU)?

The directive was implemented by the ‘Law on the domestic implementation of the Fiscal Compact’ from 15 July 2013 (see question IX.4).

 

Implementation difficulties  
VII.3
What political/legal difficulties
did Germany encounter in the implementation process, in particular in relation to implications of the directive for (budgetary) sovereignty, constitutional law and the budgetary process?

 

No particular discussions known.

 

Macroeconic and budgetary forecasts      
VII.4
What institution will be responsible for producing macroeconomic and budgetary forecasts (article 4(5) Directive 2011/85/EU)? What institution will conduct an unbiased and comprehensive evaluation of these forecasts (article 4(6) Directive 2011/85/EU)?

The forecasts regarding tax revenues is made by a working committee of the Federal Ministry of Finance which exists since 1955. This institution consists of one representative from the Federal Ministry of Finance, one from the Federal Ministry for Economic Affairs, representatives of five institutes for economic research, one from the Federal Statistics Office, one from the German Bundesbank, one from the German Council of Economic Experts, one from the Finance ministries of the Länder and one from the federal union of the communalities.

The macroeconomic forecast is developed by the Federal government.

 

Fiscal Council    
VII.5
Does Germany have in place an independent Fiscal Council (article 6(1) Directive 2011/85/EU: ‘independent bodies or bodies endowed with functional autonomy vis-à-vis the fiscal authorities of the Member States’)? What are its main characteristics? Does Germany have to create (or adapt) a Fiscal Council in order to implement Directive 2011/85/EU?

Yes. This function is fulfilled by the stability council (“Stabilitätsrat”) pursuant to Article 6 of the Stability Council Law. The Stability Council consists of the Federal Finance Minister, the Federal Minister for Economic Affairs as well as the Finance Ministers of the 16 Länder. In order to fulfil the requirement of an independent body the stability council has an independent advisory council which can issue reports and comments on the development of the public deficit (§ 7 of the Stability Council Law). The advisory council consists of one representative from the Bundesbank, one representative from the German Council of Economic Experts, one representative from the research institutes which participate, two experts nominated by the Federal Republic and the Länder, one expert nominated by the communalities and one expert nominated by the social insurances.

 

Regulation No 1176/2011 on the prevention and correction of macroeconomic imbalances 
(
http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:32011R1176:EN:NOT)

MEIP difficulties          
VII.6
What political/legal difficulties
did Germany encounter and what debates have arisen, in particular about implications of the regulation for (budgetary) sovereignty, constitutional law, socio-economic fundamental rights, and the budgetary process?

The parliamentary group the Left (Die Linke) from the opposition demanded that the social implications of such measures must be taken into account and that one of the reactions to the increase of public spending must be the consideration of higher wages. In addition, they pleaded for the establishment of a European Bank for public securities whose role would be to buy public securities from money borrowed from the ECB.[1]

 

 

Regulation No 1175/2011 on strengthening budgetary surveillance positions    
(http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CONSLEG:1997R1466:20111213:EN:PDF)

MTO procedure
VII.7
What changes to the rules on the budgetary process are made to accommodate the amended Medium-term Budgetary Objective (MTO) Procedure?

See question IX.4.

 

European semester   
VII.8
What changes have to be made to the rules and practices on the national budgetary timeline to implement the new rules on a European Semester for economic policy coordination (section 1-A, article 2-a consolidated Regulation 1466/97)?

See question IX.4.

 

MTO difficulties            
VII.9
What political/legal difficulties
did Germany encounter and what debates have arisen, in particular about implications of the regulation for (budgetary) sovereignty, constitutional law and the budgetary process?

 

The parliamentary group the Left (Die Linke) asked the Federal Government not to vote in favour of the Regulation but to campaign for a “European Compensation Union” (“Europäische Ausgleichsunion”) which is entitled to impose penal interests on accumulated current account surpluses in order to finance a structure and cohesion fund for the promotion of a structural change in the deficit countries to increase the productivity. Moreover, the German Bundestag shall develop a draft legislative act which increases the wages (including a minimum wage of Euro 10 per hour), increases public investments and promotes the social state.[2]

 

Respect MTO          
VII.10
How is respect of the Medium-term Budgetary Objective included in the national budgetary framework (section 1A, article 2a consolidated Regulation 1466/97)?

 

It is laid down in Article 51 (2) of the Law on the budgetary principles (“Haushaltsgrundsätzegesetz”).

 

Current MTO        
VII.11
What is Germany’s current Medium-term Budgetary Objective (section 1A, article 2a consolidated Regulation 1466/97)? When will it be revised?

 

The 2014 MTO was at 1.1 % of the GDP.

 

Adoption MTO     
VII.12
By what institution and through what procedure is Germany’s Medium-term Budgetary Objective adopted and incorporated in the stability programme (Eurozone, article 3(2)(a) consolidated Regulation 1466/97)?

See question IX.4.

 

Regulation No 1177/2011 on the excessive deficit procedure
(http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CONSLEG:1997R1467:20111213:EN:PDF)

EDP difficulties
VII.13
What political/legal difficulties
did Germany encounter and what debates have arisen, in particular about implications of the regulation for (budgetary) sovereignty, constitutional law and the budgetary process?

See question VII.9.

 

Regulation No 1173/2011 on effective enforcement of budgetary surveillance     
(http://eur-lex.europa.eu/LexUriServ/LexUriServ.do?uri=CELEX:32011R1173:EN:NOT)

Sanctions
VII.14
What political/legal difficulties
did Germany encounter and what debates have arisen, in particular about implications of the regulation for (budgetary) sovereignty, constitutional law and the budgetary process?

See question VII.9.

           

General changes           
VII.15
What further changes have to be made to the rules on the budgetary process in order to comply with the Six-Pack rules?

No necessary amendments known.

 

Miscellaneous
VII.16
What other information is relevant with regard to Germany and the Six-Pack?

The decision of the German Federal Constitutional Court (see question V.4).

 

[1] German Bundestag, printed matter 17/5905, 25 May 2011, http://dipbt.bundestag.de/doc/btd/17/059/1705905.pdf

[2] German Bundestag, printed matter 17/5904, 25 May 2011, http://dipbt.bundestag.de/doc/btd/17/059/1705904.pdf