Europe in 2025
A global champion of sustainable growth
Policy Recommendations
We are beginning to track our Vision 2025 starting on 15 January 2010.
Secure a quick return to sustanainable public finances, in particular:
This overall assessment is based on the following three recommendations.
Ensure respect of the Stability and Growth Pact
Ensure respect of the Stability and Growth Pact by all EU Member States and encourage public budget surpluses over a sustained period of time as soon as the economic situation allows this. This should be financed by cutting public expenditure on policies that are not sustainable.
ERT Comment
The current situation is exceptional, with almost all Member States in an excessive deficit procedure. ERT welcomes measures designed to strengthen national budget discipline and accounting standards. In the light of the current sovereign debt crisis, the newly established rules and sanction mechanism must be strictly applied if a Member State does not adhere to its commitments. (last updated December 2011)
Fully account for public pension liabilities
Fully account for public pension liabilities in considerations of the sustainability of public finances. Carry out an EU-wide independent and comprehensive assessment of public pension systems and develop a road map to guide their prudential reform.
ERT Comment
There is currently no evidence of plans for a comprehensive assessment. Some reforms have been carried out in some Member States, but more transparency is needed. (last updated December 2011)
Reform social security systems
Reform social security systems to strike a better balance between social cohesion and financial sustainability, for example by placing greater emphasis on patients’ responsibility for health care costs.
ERT Comment
Some reforms have been carried out in some Member States, but overall there is too little progress in the EU. (last updated December 2011)
Reform the EU budget
Reform the EU budget, putting its core focus on policies and measures genuinely designed to boost competitiveness and economic reforms in line with the multi-faceted definition of sustainability. Emphasise R&D and the introduction of innovative infrastructures, technologies and energy sources. Adapt EU agricultural policy to reduce its impact on the EU budget, while safeguarding the Single Market.
ERT Comment
The discussion on the Multiannual Financial Framework must put emphasis on the use of scarce public money and go beyond the level of national contributions. Budget cuts must be avoided in areas that represent investments into future economic growth. (last updated December 2011)
Devise ambitious policies and implementation programmes on energy efficiency and climate change
Devise ambitious policies and implementation programmes on energy efficiency and climate change that can be expected to have a sustainable positive impact on economic growth, in particular:
ERT Comment
The programmes exist but there is too little progress on ensuring that they have a positive impact on economic growth. (last updated December 2011)
Pursue energy efficiency:
Pursue energy efficiency: Set clear targets for energy efficiency and progressively adapt them in line with technological developments and on the basis of a full life-cycle analysis, also taking into account resource, environmental, social and economic aspects. Promote the use of low-carbon alternatives.
ERT Comment
The Energy Efficiency Plan is positive in that it calls attention to the large benefits that can be gained in the building and housing sectors. It also indicates that public procurement should be utilised to support energy efficiency goals. However, by placing a cap on energy demand, it leads Europe down the wrong path. (last updated December 2011)
Move towards a low-carbon economy:
Move towards a low-carbon economy: Encourage the continuing development of a global carbon market by taking steps towards linking the EU Emissions Trading System (ETS) with other developed country systems (notably the USA), ensuring broad access to project mechanism reductions and market surveillance conducted at an EU level.
ERT Comment
ETS will not be adopted by the USA, and there is little certainty that ETS will be the model adopted by other countries . (last updated November 2011)
Progress development of the EU energy market:
Progress development of the EU energy market: Follow a course of energy policy development that encourages full use of EU indigenous energy sources, setting the parameters within which the market operates rather than defining the market structure.
ERT Comment
While progress has been made on the legal framework, the full impact of unilateral decisions of Member States on their energy mix remains to be seen. It is unlikely that the Energy 2050 Roadmap will provide additional clarity. (last updated December 2011)
Foster the security of energy supply to the EU at competitive prices
Foster the security of energy supply to the EU at competitive prices, e.g. by putting in place more infrastructure and infrastructure connections in gas and electricity networks, diversifying gas sources, routes and supply chains, including the construction of liquefied natural gas (LNG) terminals, and adopting a common EU approach to external energy relations..
ERT Comment
The unilateral decision taken by Germany added addtional complexity to the issue of "European" energy security. (last updated December 2011)
Realise the potential of companies to contribute more actively to sustainability:
The EU focus on energy and raw materials is on the right topics, but the current process is cumbersome and with overlaps. A more holistic approach between the EU actors is needed to provide improved clarity and quality.
Incentivise the private sector to develop and deploy new technologies
Incentivise the private sector to develop and deploy new technologies that support sustainable economic growth, the environment and employment, e.g. cost-effective low carbon technologies. These could include solar, offshore wind, carbon capture and storage (CCS), nuclear energy, electric vehicles and smart traffic management, the use of biomass, information and communications technology (ICT), and smart grids. Policy-makers can support this through public procurement or specific policies as appropriate (for example a regulatory approach that supports long-term private investments in modern infrastructure with long payback periods).
ERT Comment
With respect to energy technology, ERT supports the SET-Plan as the appropriate approach to drive the R&D, demonstration and early market take-up of low-carbon technologies, but more clarity is necessary for all aspects of its funding. Furthermore, the SET-Plan must be complemented with regulatory measures to speed up the approval phase of infrastructure projects. The Europe 2020 Strategy correctly identifies the need to foster broader incentives to develop and deploy new technologies, e.g. by granting tax incentives. However, implementation in the Member States beyond previously existing legislation is not yet visible. (last updated December 2011)
Facilitate access to venture capital funding in the EU
Facilitate access to venture capital funding in the EU for companies in areas with a high growth potential, including new Information and Communications Technologies, nanotechnologies, biotechnologies, environmentally beneficial technologies.
ERT Comment
The current financial environment in the EU is hindering Venture Capital (VC) development activity. This is reflected both among VC firms and angel investors. Also in the US VC activity is slower and focus is not on innovation as such but more on later stage investments and established businesses. (last updated December 2011)
Drive the development of new tools to measure environmental sustainability
Drive the development of new tools to measure environmental sustainability, including a global carbon accounting standard, where a harmonised methodology at EU level is required. To this end, existing approaches around the world should be reviewed to identify a coordinated way forward.
ERT Comment
After gathering information on existing tools and methodolgies, DG Environment appears to have rejected 15 years of industry experience and is preparing to impose yet another methodology on industry. There is no effort being made to identify the carbon footprint of goods imported into the EU. (last updated December 2011)
Reduce the EU’s raw material dependency
Reduce the EU’s raw material dependency, including by investing in R&D aimed at technologies to reduce raw material needs and new recycling techniques.
ERT Comment
The Resource Efficiency Roadmap has been issued, but there are delays in launching the Raw Materials Initiative II. The Resource Efficiency Roadmap, while having positive points, also calls for several potentially misdirected new initiatives concerning labelling and taxes. (last updated December 2011)