Non-Transparent and Applying Wrong Remedy: Bailout ‘Troika’ Scrutinized

Written by | Tuesday, October 29th, 2013
@Eubulletin

A ‘troika’ of main bailout institutions active in the European Union – the International Monetary Fund, the European Central Bank and the EU Commission – are to be challenged by some members of the European Parliament (MEPs). MEPs claim that the institutions have not been transparent in their dealing with the bail-outs in several EU countries since their first involvement in Greece and Ireland. The main job of the institutions is to oversee spending cuts.
The coordinators of the MEPs’ ‘group’ for troika transparency agreed to launch an investigation into the work of the three institutions in Greece, Ireland, Portugal and Cyprus. Sven Giegold, German Green MEP and the MEPs’ representative said that ‘troika’ assumes a powerful role in the eurocrisis but their role is to a large extent non-transparent. The investigation should consist of hearings of ‘troika’ officials as well as of independent experts’ opinions on particular policy advice of the ‘troika’ as the validity of some of their assumptions have been already proven wrong during the crisis. Unemployment, the most visible outcome of the policy advice, is believed to be higher than expected, the economy plummeted, and public debt soared. “That is why many European citizens are expecting a comprehensive probe into why these dramatic results came about. We need to look carefully at potential breaches of law or abuses,” Mr Giegold concluded.
Parties involved in this inquiry are still negotiating the exact scope of the investigation, which must be also approved by group leaders and committee chairs in early November. The query will be headed by Othmar Karas, Austrian EPP MEP, and French Social-Democrat, Liem Hoang Ngoc. Belgium’s MEP Philippe Lamberts from the Greens and his Conservative Dutch colleague Derk Jan-Eppink will assume the role of “shadow rapporteurs.” An issue that might come under scrutiny will likely be the work of private consultancies involved with the troika.

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INSTITUTIONS & POLICY-MAKING

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