How can the economic dialogue be strengthened?

By March 7, 2018Uncategorized

By Maja Kluger Dionigi, Think Tank Europa

The European Commission’s recent roadmap for completing the European Monetary Union (EMU) suggests increased involvement of parliaments in EU economic governance. For example, the Commission proposes to formalise the economic dialogue, create a European Minister of Economy of Finance accountable to the European Parliament (EP), and integrate the Fiscal Compact into EU law. These initiatives seem to be a godsend to the EP, who for the most part played second fiddle in the EU’s response to the sovereign debt crisis due to the executive-dominated approach to crisis resolution. The question is to what extent these proposals thicken the EMU’s thin democracy without changing the ways in which existing oversight mechanisms work.

In a recent paper, I examined how actively and diligently MEPs use the economic dialogue. This was done through a systematic analysis of all the hearings involving member states in the EP’s Committee on Monetary and Economic Affairs (ECON) between 2012 and 2016. The economic dialogue was invented to increase transparency and accountability in EU economic governance and makes it possible for the EP to publicly discuss the decisions taken by executive bodies (e.g. the Council system, Eurogroup, Commission, and national governments).

The success of the economic dialogue has largely depended on the willingness of executive bodies to participate in the dialogue, as only the Commission has a clear treaty-based obligation to do so. Practical experience with the dialogue shows that even actors who take part in the dialogue on a voluntary basis (such as member states and the Eurogroup) have been willing to participate. From this perspective, the dialogue has been a success. However, when focusing on MEPs’ engagement and the content of the hearings, there is still scope for improvement. While the hearings do raise the transparency of decisions taken in EU economic governance, the degree to which they increase accountability is questionable. The dialogue suffers from several practical weaknesses that put a cap on its (potential) effectiveness as a parliamentary oversight tool, most notably from:

(1) Political responsibility in EU economic governance is difficult to attribute
(2) The economic dialogue is far from a ‘true’ dialogue
(3) Few MEPs ask pertinent questions

Political responsibility is difficult to attribute

It is questionable if the economic dialogue can fill the gap of limited parliamentary accountability in economic governance as along as the very structures are not changed. As also highlighted by other researchers, it is unclear who should be held accountable for the decisions taken in the EU’s reformed economic governance system, particularly concerning the European Semester. This is because supranational political authority is suspended between the collective of national governments in the European Council and Council, and the Commission. The European Semester is an iterative step-by-step process where it is difficult to assess when the significant decisions are taken and by whom. At every step of the process, it is possible for the actors involved to attribute their policy choices to the conditions set at the previous step. The Commission, for instance, can only present its decisions as the implementation of the rules set by national governments. At the same time, the member states are not politically accountable as a collective at the EU level and in practice often support the Commission’s position. This makes the principle that ‘democratic control and accountability should occur at the level at which the decisions are taken’ rather difficult to adhere to in practice. Aligning the dialogue better with the different stages of the European Semester may be a step forward in including the EP better in decisions taken.

The dialogue is far from a ‘true’ dialogue

The format of the economic dialogue does not allow for in-depth discussion. Hearings consist of three consecutive parts: (1) an approximately ten-minute presentation by the invited minister (usually the minister of finance or economics), (2) questions from MEPs from a set speaker list, and (3) a catch-the-eye session. For each MEP taking the floor, there is five minutes allocated to ask a question and receive an answer before the floor is given to someone new. It is questionable whether these five-minute slots work in practice as there is rarely time to pose follow-up questions. This makes the nature of the economic dialogue more of a barrage of questions and answers rather than a ‘true’ dialogue. The lack of follow-up questions does not allow MEPs to really challenge ministers as there is no time to contradict the answers given, ask for elaboration, or point out contradictions. If accountability is about asking for explanations and justification of political choices made – rather than pure information provision – then the economic dialogue still needs to go some way before it develops into a proper scrutiny mechanism. A better organisation and coordination of the issues raised by the political groups might allow for more focused hearings and a deeper exploration of issues.

Few MEPs ask relevant questions

Only few MEPs ask pertinent questions to member states, that is questions that go to the heart of the member state’s economic and financial problems. Many of the questions asked depart from the legal framework for the dialogue laid down in the Six-Pack and Two-Pack and concern broader economic issues often not related to the specific situation of the country under scrutiny. Better preparation on part of the MEPs might help to focus the questions better.

The above suggestions show that strengthening the economic dialogue needs to go further than only formalising the procedure. It is important to remember, however, that the dialogue is still a young initiative and is part of an ongoing learning process.


The author is writing in a personal capacity and the views do not represent the TransCrisis consortium as a whole.