Michel Barnier stood in front of the French Senate to defend reforms of the financial system that were taken under his watch. He also reaffirmed his support for Jean-Claude Juncker as the next President of the EU Commission. EURACTIV France reports.
Many turned up to attend a French Senate audition with Michel Barnier, Europe’s outgoing Commissioner for Internal Market and Services. Barnier, who was officially summoned to defend his track record, stood to outline his achievements.
During his four years in office, the Commissioner claims to have pushed through 41 directives or regulations. This number is not just down to his professional efficiency, but also due to the urgent situation that the EU found itself in. “The financial system had to be improved so that banks could pay for themselves if they had a problem, instead of the tax payer,” said Barnier.
His achievements include additional supervisory rules for the financial system, such as Basel III, greater surveillance of the financial sector, or even the banking union, in which a centralised authority supervises the entire Eurozone to prevent systematic risks.
80% of the programme achieved
“Compared to June 2010, I would say we have carried out 80% of our programme”, said Barnier, who believes there are still three important reforms to put in place, the most important of which include a reform of the 29 biggest European banks.
The second necessary reform concerns “shadow banking”, or a parallel banking system which is currently not regulated.
The final reform proposed by Barnier is in relation to Euribor and Libor price fixing. “Manipulation of major economic indicators often leads to outrage,” added the soon-to-be ex-Commissioner.
A regulating track record, not a liberal one
Barnier congratulated himself for putting in place “the necessary pre-condition for all initiatives aimed at reviving economic growth, which is a return to financial stability.”
When asked by senators if the reforms went far enough, Barnier argued that the system had been completed, “except for the 29 biggest banks.” He also implicitly blamed France for preventing the “European Bank law” from advancing.
“It is up to France to take responsibility, the law is reasonable”, he said.
Having swiftly adopted the conservative banking law in 2012, France is now trying to protect its banking sector by stalling a more restrictive European law. The Commission wants to ban “property trading” of financial instruments and commodities. The prohibition is on transactions which have the “sole purpose” of making a profit for a bank’s own account.
The Commissioner also drew attention to how Europe put in place directives that criminalised “abusive financial activities.”
“Some people will go to prison if they deserve it,” he said.
These measures, put in place by a centrist Commissioner from the UMP, earned Barnier respect from the French left. “From listening to you, you do not seem like a liberal at all, more like you were on our team,” said a socialist senator.
Priority to industry and economic growth
Barnier argued that Europe needed a new direction where industry would be central to the European project. “We managed to do it for agriculture, so it is nothing to do with treaties. If there is a common will, the new Commission can establish a Europe of energy,” he said.
Barnier believes that France is capable of reducing its public deficit to below 3% of GDP by 2015, despite the Commission’s doubt on the matter. “France can achieve its target in 2015 because it is in its interest to do so,” he confirmed.
“The key to success is economic growth. We must free up our country’s innovation and energy reserves”, he said and added that Manuel Valls’s stability program was a step in the right direction.
When questioned by EURACTIV France about the future president of the Commission, Barnier said he supports “Jean-Claude Juncker since the congress in Dublin,” and that he will continue to support him because he is the legitimate candidate. In Dublin, the EPP elected Juncker as their official candidate for President of the Commission instead of Michel Barnier who, when it was put to a vote, received 245 votes compared to 382 in favour of Jean-Claude Juncker.
This confirms Michel Barnier’s position on the European right, and could make him a backup candidate if Junker fails to form a majority. Even if this were to happen, the French socialist government is not likely to support any moves to make a UMP man President of the European Commission.