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What is the difference between Europe 2020 and its predecessor the Lisbon Strategy?

Growth and jobs, working together for Europe's future © EU

Europe 2020 builds on lessons learned from the earlier strategy, recognising its strengths (the right goals of growth and job creation, 18m new jobs created since 2000) but addressing its weaknesses (poor implementation, with big differences between EU countries in the speed and depth of reform).

The new strategy also reflects changes in the EU's situation since 2000 – in particular the immediate need to recover from the economic crisis.

What will Europe 2020 bring that is different from before?

1. A new kind of growth (smart, sustainable and inclusive) – mainly by:

  • improving skills levels and (life-long) education
  • boosting research and innovation
  • more use of smart networks and the digital economy
  • modernising industry
  • greater energy and resource efficiency.

2. Stronger governance through:

  • regular and transparent monitoring
  • leadership at the highest political level – the European Council.

The Commission is steering the process and uses the new instruments introduced by the Lisbon treaty – recommendations, policy warnings where necessary, and, for serious delays, the possibility of penalties.

3. Tighter economic coordination

Under new arrangements for coordinating economic policy –  the "European semester" – national governments have to submit reports on economic reform, stability and convergence at the same time, so they need to ensure solid funding for their reform programmes.

Effective and timely delivery is also helped by strong monitoring during the European semester, clear and measurable targets (both at EU and national level) and robust surveillance.


What is the "European semester"?

This is a time-window in the first half of each year in which national governments report to the Commission at the same time on progress with:

During this time, the Commission can give policy guidance and make recommendations to the governments before national budgets are finalised. This will help member countries coordinate their economic policies better, benefiting from a shared EU economic agenda while still tailoring policy for their national situation.

It will also help the EU to draw timely lessons from national developments, for incorporation into future rounds of coordination. The European semester starts with the publication of the Annual Growth Survey.


What is the Annual Growth Survey?

A report presented by the Commission that assesses the main economic challenges facing the EU and recommends priority measures to address them.

Based on this input, EU leaders will give guidance on possible responses at their spring meeting.


Why do we need a long-term plan when we're still struggling on a day-to-day basis?

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The recovery is still the immediate priority, and the EU has already acted to stabilise the banking sector and stimulate economic activity. But we also need to look beyond the current crisis.

The EU is already under pressure from competitors and demographic change. Simply returning to our pre-crisis situation will see us falling further behind.

So we need to start now to design the measures that will make the EU stronger and more competitive in future.

Reforms also take time – we must start now if we want to protect what we most value about our way of life.


How does the strategy guard against crisis-driven calls for more protectionist economic policies?

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By making it more attractive for EU countries to work together rather than compete against each other.

It will do this through greater transparency – so each country can see what the others are doing. Based on monitoring and benchmarking, the Commission produces an annual report on highlighting progress towards targets, and pinpointing delays and weak implementation. The sharing of best practice is very much encouraged.

The EU also seeks to move countries towards greater cooperation by issuing policy recommendations to member governments (through the European Council). If these are not followed, or if national policy goes in the wrong direction, the Commission will use its new powers under the Lisbon treaty and issue policy warnings and, as a last resort, impose penalties.


Why does the strategy not have its own budget?

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Because throwing money at problems is not the solution. The key to long-term, sustainable growth is reform – both structural reform and changes in  public spending.

When budgets are tight, it is all the more important to channel scarce resources towards delivering a smarter, sustainable and inclusive economy. This will also generate more revenue in the long run and ease public finances.

The EU already funds numerous programmes that can be channelled towards these goals. For example, between 2007 and 2013, over €50bn is available for R&D projects, over €3bn for competitiveness and innovation and nearly €7bn for lifelong learning. This is all in addition to €277bn worth of regional funding for the same period through the Structural Funds.

EU governments are encouraged to review their own public spending to improve quality and efficiency and, despite significant fiscal constraints, find ways to invest in sustainable growth.

At the same time, new financing models (such as public-private partnerships, leveraging EU or European Investment Bank funding, etc.) should be explored, to pool public and private-sector resources and maximise impacts.


Why not use existing tools rather than extending into new areas?

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Europe 2020 does mobilise all existing EU policies, instruments and laws, as well as financial and coordination instruments.

In particular, the EU is bolstering some of the key levers at its disposal, to ensure delivery of Europe 2020 goals: single market policies (encouraging greater economic integration), industrial policy and the EU's external economic and trade agenda.


Will the Stability and Growth Pact be merged with Europe 2020?

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No – the Commission has no intention of doing this.

The Pact is an important tool for consolidating public finances and stimulating  growth – but it has its own mechanisms, which must remain in place.

However, because budget policy impacts structural reforms, and vice versa, the Stability and Growth Pact and Europe 2020 must operate in close cooperation.

This is why national governments are required to submit their annual national reform programmes and stability/convergence programmes at the same time (in April).


Why does Europe 2020 propose action in areas run by national governments, e.g. education and employment?

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Because the crusade to keep Europe competitive can benefit from coordination at EU level. The EU is not intervening in these policy areas, merely offering the benefit of its overview position to make recommendations that should help individual countries.

The EU is seeking to help because the stakes are so high – Europe needs strong economic growth and high levels of employment to sustain its levels of social protection, especially with its ageing population.

This means giving people the skills to succeed in new economic circumstances, hence the reform proposals for education and training in the strategy.


How much input did stakeholders and citizens have in designing the strategy?

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A wide range of groups both in and outside the EU made more than 1400 contributions to a 2009 public consultation on the strategy.

Contributors included national and regional government, trade unions, business, NGOs, academics, consumer bodies and some 500 individual citizens.

The Commission took account of this feedback in designing the strategy.