Ms Catherine Day:

That is also something we are trying to get better at, together with the member states. If it is a ten-year project, as some of the issues that need to be tackled are, then we must see whether we can work with the member state to have the right kind of plan and see if its plan will deliver in ten years but also to check whether in year three it is ahead of schedule or falling behind and the reasons for that. It is not just a question of what are the obstacles or why a country is off course but what we can do to help. What is necessary is to break plans down into manageable chunks. Sometimes it is very clear and we need to say countries should adopt a law on this or repeal a law on that. That is something one can do in a year. The recommendations tend not to be wildly different from one year to another but from year to year they become more nuanced because, normally speaking, the country is moving through different stages of trying to achieve big and demanding reforms.

We have made recommendations on the banking sector. I have in mind the 2013 round when, for Spain and Slovenia - both countries that have been tackling big problems in the banking sector - there were much more detailed recommendations to them on what they should do than to other countries. For example, we have picked up on the housing market in a number of member states, even in countries such as the Netherlands and Sweden where, again, they did not initially think they had a problem but after much more detailed discussions they recognised that they would have to do certain things because otherwise they might have a problem.

The semester will definitely help with jittery markets. We have all lived through the past few years when a lot of the media predicted the imminent demise of the euro and said that Europe could not do it and was not able to address the issue. We have convincingly demonstrated to the markets that Europe has the political will to keep the euro as a strong currency and the existential question has now been put to one side. We can only be convincing to very hard-headed market analysts because we have good systems in place. They want to see the transparency, the mechanisms that will push constantly for the necessary kind of sound behaviour. That is all part of being more credible in the future.

On the annual growth survey, it is a very good question to ask what we mean by public sector reform. We look at this from a lot of different angles. First, in most European countries we are used to a very big public sector, and this is expensive, so we have to look at whether the public sector is paying its way in terms of the capacity of various economies. Then we look at the performance of the public sector. For example, in some countries there is a very big gap between the theoretical tax take and the actual tax take. One can see in countries such as Greece, where there is a very dramatic difference, that there is an incapacity in the public sector to get in the tax revenue that should be levied by law, but the Government needs to have the income to provide the social services. What we want to do is to look at whether we can help. In the case of Greece one has a number of member states giving their expertise on how to run a modern tax system. My colleagues were telling me recently that one can begin to see a turnaround in the Greek tax collection system. That is just one example.

We would like to push to make public sectors more directly accountable to the citizen. We would also like more electronic means of conducting public sector business such as doing one’s taxes online. This would cut out opportunities for corruption and speed up the process, but it would also mean the citizen could be directly in touch with the public sector. It would also mean that one could enter one’s details once rather than filling in forms duplicating information to cover each government agency or Department.

It is different in member states because each has a different tradition, with some being federal and others highly centralised. We believe, however, that the public sector is not performing as it should over a range of issues. For example, one could point to the quality of education, skills mismatches or, as Deputy Seán Crowe pointed out, how unemployment services are working. In many countries unemployment services are being overhauled to make them more personalised rather than just adopt a mass approach. These are all aspects of public sector reform and we want to look with member states at where they need to improve their performance.

There is also the issue of sharing best practice. Most member states are grappling with variations of similar problems in the public sector. Perhaps groups of member states can share solutions. All the public sector employment agencies work much more closely together. We have developed a Europe-wide job vacancy site, EURES, which has 1 million vacancies on it at any given time. This offers practical help to member states to work better together in the interests of the citizen.

We do not have an army of bureaucrats and we do not need one. We work with member states in trying to use their knowledge and capacity. As our understanding of each member state’s economy is improving year on year, one does not have to go back to the beginning every year. However, member states do not know very much about each other. They might know a little about their immediate neighbours. Accordingly, we are trying to give them a more digestible picture because they now understand that it does matter to them if Greece is off track or there have been developments in Ireland or Spain.

We give member states comparative data which allows them to benchmark themselves. National civil services do not necessarily have all of that information. By producing tables on performance in various areas, we were able to set a benchmark, for example, for the administrative time it takes to set up a small company. The tables showed it should not take more than three days and cost no more than €100. When some member states saw it took them between 75 and 300 days, there was quite a dramatic change and overhauling of their systems.

Members have asked if the European institutions have a heart, understand people are suffering and that there is hardship. Yes, we do and it worries us very much. We are wrestling with what are the right polices to overcome the problems we have. We believe sound public finances and a functioning economy are part of the way out of the crisis. We have proposed more targeted programmes. For example, members will be familiar with the youth guarantee because the Irish EU Presidency helped us to deliver it. That is a practical way of trying to give all young people not in full-time education or employment the opportunity to be taken up by the system and improve their employment chances. In our growth strategy, Europe 2020, we have five target areas on which the European Union should be working. These include increasing participation in the labour market and lifting 20 million people out of poverty. We recognise that while a job is the route out of poverty for many, it is not for everyone. We have to have policies to support and surround this. In the crisis we are not doing very well; that is not a reason to change the target or give up but actually to redouble efforts.

In addition to the hard economic indicators which underpin the semester process, last year the Commission proposed to add a set of social indicators to give a more rounded picture of what growth we wanted to achieve. It is not growth at any price but having inclusive growth. While I know we publish many impenetrable documents, in many of them the concept of fairness is very clearly included. The Commission is worried about growing inequality which we want member states to address. It comes back to my point on taxation. If one does not have a functioning tax collection system, there will always be people who will have to pay and those who will not be able to pay. That is fundamentally unfair. If it is because of inefficient systems, it should be tackled.

The idea of increasing the lending capacity of the European Investment Bank was agreed to a year and a half ago. The bank’s capital was increased by €10 billion which it is reckoned will lead to a roll-out of investment amounting to €180 billion. There is increased activity on the bank’s part. The Commission has come up with more ideas for stimulating lending to small and medium-sized enterprises, but not all of them have been agreed to by member states.

Enlargement has been a phenomenal success and an economic success for the member states which have joined recently. For the older member states, it has been a phenomenal political success to rejoin the Continent. It is very distressing that people do not feel this but instead feel it is putting pressure on the European Union. When we come out of the crisis, we will grow into our new size. I am not sure so many Americans could list their 50 states. I can never list the seven dwarves and get stuck on the fifth or sixth. Therefore, I am not sure listing all of the EU member states is the best test of Europeanness. We need to find some way of feeling proud of what we are achieving. We all know from meetings in Brussels that it is extremely tedious to sit there while 27 other member states give their position. It takes two or three hours to go around the table once. However, it is great we are doing this. The miracle is that, despite the complexity, we still manage to take important decisions and move on. There is no other regional grouping in the world that is anywhere near as successful as the European Union. Sometimes it would be great if we could focus on the positives we are achieving.

We take seriously the idea of the Commission as a conscience. That is why the Commission’s President, José Manuel Barroso, will soon produce ideas on the rule of law in the European Union. We have seen problems in some member states where there is no respect for the European value of the separation of roles, namely, an independent Judiciary without interference from the political sphere. The Lisbon treaty has a nuclear option - the taking away of the voting rights of a member state that does not respect European values. That is an unimaginable state at which to arrive, but we need ways to see how the rule of law functions in member states before there is such a scenario.

As we come out of the crisis, I hope the Commission will go back to its long-term mandate. What it can do to complement the work of member states is to design long-term frameworks that can take 30 years to deliver. Tackling our aging society, for example, is part of a long-term target that we could do better together rather than separately.

Yes, I agree that the timing of the country-specific recommendations, CSRs, is tight. It might be too tight. They are published by the Commission at the end of May.

Everybody knows what the Commission recommends. Then the member states in both the Economic and Social Council and the Economic and Finance Council prepare for discussion endorsement by the Heads of State in the June European Council, which is normally at the end of June. I think that is too tight because it allows us to have only a bilateral process between the Commission and each member state who try to say we should fine-tune the recommendations or we have it all wrong or sometimes, albeit rarely, that we should have insisted more on something. We want a peer discussion whereby the Commission puts this on the table so all the member states can agree that this or that country should do more or less in a different area, but there is no time for that. We can improve these matters as time goes on.