All Member states have committed to achieving Europe 2020 targets and have translated them into national targets and growth-enhancing policies. But only if the individual efforts of all the countries are coordinated and focused, can they result in the desired impact on growth.
Therefore the European Commission has set up a yearly cycle of economic policy coordination called the European Semester. Each year the European Commission undertakes a detailed analysis of EU Member States' programmes of economic and structural reforms and provides them with recommendations for the next 12-18 months.
The European semester starts when the Commission adopts its Annual Growth Survey, usually towards the end of the year, which sets out EU priorities for the coming year to boost growth and job creation.
In March, EU Heads of State and Government issue EU guidance for national policies on the basis of the Annual Growth Survey. The Spring meeting of the European Council – based on the annual growth survey, takes stock of:
It provides policy orientations covering fiscal, macroeconomic structural reform and growth enhancing areas, and advises on linkages between them.
In April, Member States submit their plans for sound public finances (Stability or Convergence Programmes) and reforms and measures to make progress towards smart, sustainable and inclusive growth, in areas such as employment, research, innovation, energy or social inclusion (National Reform Programmes).
In May/June, the Commission assesses these programmes and provides country-specific recommendations as appropriate. The Council discusses and the European Council endorses the recommendations. Policy advice is thus given to Member States before they start to finalise their draft budgets for the following year.
Finally, end of June or in early July, the Council formally adopts the country-specific recommendations.
Where recommendations are not acted on within the given time-frame, policy warnings can be issued. There is also an option for enforcement through incentives and sanctions in the case of excessive macroeconomic and budgetary imbalances.
Ministerial meetings on specific policy issues are crucial for peer review and monitoring progress towards EU headline targets, and for advancing Europe 2020 flagship initiatives.
In order to implement the required policies and ensure wide ownership, close cooperation will be maintained with the European Parliament and other EU advisory bodies (Committee of Regions and European Economic and Social Committee) with the full involvement of national parliaments, social partners, regions and other stakeholders.