11 October 2010

‘Twin Strategy is an instant reaction to failure by Conservatives to extract a fair contribution from bankers’

In a rapid reaction to last week’s negative announcements on the idea of a Financial Transaction Tax (FTT), the Party of European Socialists (PES) have today announced plans to call on its Member Parties to initiate national legislative actions which call for an FTT. The announcement comes on the eve of the first meeting of the ‘Semeta Group’ on EU Taxation Policy. The meeting, convened by European Tax Commissioner Algirdas Semeta, is expected to continue the Commission strategy of refusing to heed independent research on the merits of a European wide FTT. Last week the Commission called an FTT ‘too difficult’ without providing any explanation, and instead published details of a Financial Activities Tax (FAT) which experts say would only generate one tenth of the funds of an FTT.

 “Despite Mr. Semeta’s attempts to cloud the issue, an FTT is completely feasible and absolutely urgent. The first part of our strategy is to have our Member Parties instigating national parliamentary debates on the merits of an FTT”, said PES President, Poul Nyrup Rasmussen. He elaborated on the plans, stating that; “the Member Party action can be anything from a parliamentary resolution, to a budget amendment, to a fully fledged draft bill. We are convinced that we will have huge support for this initiative from EU citizens, who are suffering from the effects of the economic crisis and who are not being listened to at European level”.

The second, European part of the strategy will involve close co-ordination between the PES and the Socialists and Democrats (S&D) Group in the European Parliament. The Group has made the Financial Transaction Tax (FTT) a vital strand of the economic crisis recovery plan, with the concept making it into the Conclusions of the Crisis Recovery Committee chaired by French Socialist Pervenche Beres. The strategy is to also link the FTT to the EU budget. Next week will see an emergency oral question on the FTT tabled by Group President Martin Schulz at the Strasbourg plenary session of the Parliament.

The reaction by the PES family comes less than a week after Mr. Semeta provoked ire among FTT advocates, by refusing to outline any credible reasons why the Commission was not supporting the FTT idea.

Mr. Rasmussen concluded that; “The attempt by Commissioner Semeta to dismiss the FTT idea has not disheartened us but rather acts as a spur for more national and European coordination. This twin Strategy is a reaction to Conservative failure to extract a fair contribution from bankers. It is an idea that people are crying out for, on principle and due to the ravages of the crisis, by necessity”.

Commissioner Semeta and Conservative forces have chosen to hide behind the illusion of ‘capital flight’, rather than fight for ordinary people who want to see the financial service sector pay its fair share, and even more, who want desperately needed new funding streams to be identified, so that they can be protected from the harm of public budget cuts.

NOTE TO EDITORS: regular updates will be given throughout Autumn 2010 as PES Member Parties initiate their national parliament legislative actions.

The PES will continue to work on the FTT issue with a broad number of organisations under the umbrella of ‘Europeans for Financial Reform (EFFR)’.

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For further information please contact  Brian Synnott (PES Press) on +32 474 98 96 75 (brian.synnott@pes.org)