Changes from report parliamentary committee draft to plenary report

MOTION FOR A EUROPEAN PARLIAMENT RESOLUTION

Changedon the European Semester for economic policy coordination 2026

(2025/2214(INI))

The European Parliament,

Changed– having regard to the Treaty on the Functioning of the European Union (TFEU), and in particular Articles 121, 126 and 136 thereof,

– having regard to Protocol No 1 to the Treaty on European Union (TEU) and the TFEU on the role of national parliaments in the European Union,

– having regard to Protocol No 2 to the TEU and the TFEU on the application of the principles of subsidiarity and proportionality,

Changed– having regard to the Paris Agreement of the Conference of the Parties to the United NationsUN Framework Convention on Climate Change of 12 December 2015 and the UN Sustainable Development Goals,

▸11 unchanged paragraphs

– having regard to Regulation (EU) 2021/1119 of the European Parliament and of the Council of 30 June 2021 establishing the framework for achieving climate neutrality and amending Regulations (EC) No 401/2009 and (EU) 2018/1999 (‘European Climate Law’)1,

– having regard to Protocol No 12 to the TEU and the TFEU on the excessive deficit procedure,

– having regard to the Treaty on Stability, Coordination and Governance in the Economic and Monetary Union,

– having regard to Regulation (EU) 2024/1263 of the European Parliament and of the Council of 29 April 2024 on the effective coordination of economic policies and on multilateral budgetary surveillance and repealing Council Regulation (EC) No 1466/972,

– having regard to Council Regulation (EU) 2024/1264 of 29 April 2024 amending Regulation (EC) No 1467/97 on speeding up and clarifying the implementation of the excessive deficit procedure3,

– having regard to Council Directive (EU) 2024/1265 of 29 April 2024 amending Directive 2011/85/EU on requirements for budgetary frameworks of the Member States4,

– having regard to Regulation (EU) No 1173/2011 of the European Parliament and of the Council of 16 November 2011 on the effective enforcement of budgetary surveillance in the euro area5,

– having regard to Regulation (EU) No 1174/2011 of the European Parliament and of the Council of 16 November 2011 on enforcement measures to correct excessive macroeconomic imbalances in the euro area6,

– having regard to Regulation (EU) No 1176/2011 of the European Parliament and of the Council of 16 November 2011 on the prevention and correction of macroeconomic imbalances7,

– having regard to Regulation (EU) No 472/2013 of the European Parliament and of the Council of 21 May 2013 on the strengthening of economic and budgetary surveillance of Member States in the euro area experiencing or threatened with serious difficulties with respect to their financial stability8,

– having regard to Regulation (EU) No 473/2013 of the European Parliament and of the Council of 21 May 2013 on common provisions for monitoring and assessing draft budgetary plans and ensuring the correction of excessive deficit of the Member States in the euro area9,

Changed– having regard to the Commission’s Spring 2025 Economic Forecast of 1519 May 2025,

– having regard to the Commission’s Autumn 2025 Economic Forecast of 17 November 2025,

Added– having regard to the Commission’s 2026 European Semester Autumn package of 25 November 2025,

– having regard to the Commission’s Debt Sustainability Monitor 2024 of 17 March 2025,

– having regard to the Commission communication of 19 March 2025 entitled ‘Accommodating increased defence expenditure within the Stability and Growth Pact’ (C(2025)2000),

Added– having regard to the European Fiscal Board’s 2025 annual report, published on 22 October 2025,

– having regard to the report of 9 September 2024 by Mario Draghi entitled ‘The future of European competitiveness’ (the Draghi report),

Changed– having regard to the Whitejoint Papercommunication by the Commission and the High Representative of the Union for EuropeanForeign DefenceAffairs –and ReadinessSecurity 2030Policy of 2019 March 2025,2025 entitled ‘White Paper for European Defence – Readiness 2030’ (JOIN(2025)0120),

Added– having regard to the Joint Research Centre’s report entitled ‘Measuring sustainable and inclusive well-being: a multidimensional dashboard approach’, published on 28 January 2025,

Added– having regard to the Interinstitutional Proclamation on the European Pillar of Social Rights of 13 December 2017,

Added– having regard to the La Hulpe Declaration on the Future of the European Pillar of Social Rights of 16 April 2024,

Added– having regard to the Porto Social Commitment of 7 May 2021 of the Council, the Commission, Parliament and social partners,

– having regard to Rule 55 of its Rules of Procedure,

– having regard to the opinion of the Committee on Budgets,

Changed– having regard to the report of the Committee on Economic and Monetary Affairs (A10-0000/2025),(A10-0036/2026),

Change 1

ChangedA. whereas the European Semester plays an essential role in coordinating and aligning economic and budgetary policies in the Member States;States, with a view to safeguarding the macroeconomic stability of the Economic and Monetary Union and achieving a socially just transition towards a sustainable economy;

Change 2

ChangedB. whereas the European Semester recommendations in 2026 will play an essential role in the design of the national and regional partnership plans to be prepared by Member Statesthe inMember 2027;States;

Change 3

RemovedC. whereas according to the Commission’s 2025 autumn forecast, GDP growth in the EU is expected to be close to potential growth, with full employment and inflation close to the target level;

AddedC. whereas country-specific recommendations (CSRs) in the framework of the European Semester regularly include cuts in social spending, while barely addressing revenue increases;

RemovedD. whereas the EU has daunting investment needs, including for an additional annual investment of EUR 800 billion that the Draghi report deems necessary to boost Europe’s competitiveness and an additional EUR 800 billion sought for further defence spending under the ReArm Europe Plan/Readiness 2030;

AddedD. whereas the economic outlook remains uncertain, notably due to Russia’s invasion of Ukraine and the uncertainty generated by protectionist policies, tariffs and trade tensions, all of which have a negative effect on the economy;

RemovedE. whereas the EU is facing major challenges, ranging from threats arising at its eastern borders to geopolitical instability and trade uncertainty, while long-term challenges such as the green and digital transitions remain;

AddedE. whereas according to the Commission’s autumn 2025 economic forecast, GDP growth in the EU is expected to be close to potential growth, with full employment and inflation close to the target level, although inflation remains elevated in some Member States;

RemovedF. whereas the TFEU establishes reference values of up to 3 % for government deficit and 60 % for the debt-to-GDP ratio;

AddedF. whereas for the EU as a whole, the Commission forecasts growth of 1.4 % to 1.5 % between 2025 and 2027, while in the euro area the dynamics are expected to be lower (1.2 % to 1.4 %); whereas potential growth in the EU is expected to decline from approximately 1.5 % in 2024 to 1.3 % in 2027 (in the euro area from 1.4 % to 1.2 %), mainly due to unfavourable demographic trends;

AddedG. whereas the EU has daunting investment needs, including additional annual investments of EUR 800 billion that the Draghi report deems necessary to boost Europe’s competitiveness and productivity, including EUR 450 billion for the energy transition alone – of which EUR 260 billion should come from the public sector according to Institut Rousseau; whereas a further EUR 800 billion in additional investments is envisaged for defence spending under the ReArm Europe Plan/Readiness 2030; whereas these investment targets lack corresponding new own resources, leaving the Union without the fiscal capacity needed to meet its stated objectives; whereas these needs cannot be met by public financing alone;

AddedH. whereas the EU is facing major challenges, ranging from persistent threats at its eastern borders linked to Russia’s war of aggression against Ukraine to geopolitical instability and trade uncertainty, while long-term challenges such as the green and digital transitions remain;

AddedI. whereas the TFEU establishes reference values of up to 3 % for government deficit and 60 % for the debt-to-GDP ratio; whereas the EU’s headline deficit and government debt-to-GDP ratio remain above the reference values; whereas both the headline deficit and government debt-to-GDP ratio vary across the EU, with significantly divergent situations across Member States;

J. whereas the Council has not launched any procedures concerning excessive macroeconomic imbalances since the establishment of this procedure in 2011;

Change 4

ChangedH.K. whereas thisthe current Commission is committed to being an ‘investment Commission’ butand hasrelies noton yetParliament’s takensupport, as co-legislator, to take significant action to boost EU investment to a level commensurate with the needs of the green and digital transitions; whereas the Commission has yet to put forward an adequate response to the Union’s massive investment requirements, particularly given that the Recovery and Resilience Facility (RRF) will be terminated at the end of 2026;

Change 5

AddedL. whereas past crises, including the COVID-19 pandemic, have shown that a common and coordinated European response strengthens the Union; whereas, in a competitive geoeconomic environment, Europe can safeguard its interests and values only through unity, highlighting the need for a robust macroeconomic policy framework and even closer coordination of economic and social policies through the European Semester;

Economic prospects for the EU

Change 6

Changed1. Notes that over the last five years, the EU has faced major challenges, including the outbreak of the COVID-19 pandemic and theRussia’s Russianillegal and unjustified war in Ukraine, which have had major economic impacts; underlinestakes note of the effectivenessswiftness and impact of EU-wide initiatives and instruments to address the economic and social consequences of external shocks, in particular the RecoveryRRF and Resiliencethe FacilityEuropean (RRF);Instrument for Temporary Support to Mitigate Unemployment Risks in an Emergency (SURE);

Change 7

Changed2. Notes that, according to the Commission’s autumn 2025 economic forecast,forecast published on 17 November 2025, the EU’s GDP is expected to increase by 1.4 % in 2025 compared to 2024;2024 and by 1.4 % in 2026; observes that, based on this forecast, the EU is still lagging behind the United States and China in terms of growth expectations; highlights that, despite significant challenges, the euro area and the EU have demonstrated resilience;

Change 8

Removed3. Notes that the general government gross debt-to-GDP ratio is expected to reach 82.8 % in 2025;

Added3. Notes that potential growth, which marks the growth rate an economy can sustain without excess inflation, is set to decline from 1.5 % in 2024 to 1.3 % in 2027 in the EU, and from 1.4 % to 1.2 % in the euro area, as growth in the working-age population slows; considers these potential growth levels to be too low to master the challenges facing the European economy in the years to come;

Removed4. Expresses concern that insufficient private and public investment is likely to hinder sustainable growth in Europe and prevent the EU from meeting the common priorities stated in the EU strategic agenda 2024-2029;

Added4. Notes that according to the Commission’s autumn 2025 economic forecast, the aggregate euro area deficit is projected to increase from 3.1 % of GDP in 2024 to 3.2 % of GDP in 2025; notes that on the basis of current policies, the deficit is expected to rise to 3.3 % of GDP in 2026;

Removed5. Recalls that extreme weather events have a material impact on public finance; is aware that the impact and frequency of extreme weather events will only increase in the coming years as a result of climate change;

Added5. Notes that 12 Member States are set to have deficits exceeding 3 % of GDP in 2027 and that 10 Member States are under excessive deficit procedures;

Removed6. Welcomes the fact that inflation has been brought down to the European Central Bank target level after reaching its peak level of 10.6 % in October 2022; notes, however, that inflation remains at different levels across the Member States, with higher levels in Member States with energy-intensive industries;