True to our commitment to being the bridge between people and the European Central Bank (ECB), ahead of the last monetary dialogue in June we collaborated with our friends at SumOfUs to collect our supporters’ views, expectations and concerns related to the ECB’s work. The results showed overwhelming support for ambitious and proactive environmental actions by the ECB. They also rang a bell about the need for clearer communication from the Central Bank on the effects of its interest rate hikes.
The European Central Bank (ECB) is a powerful institution and, although independent from governments, it is only right that its actions are kept under control by a high degree of transparency and democratic accountability. One of the instruments that the European Parliament has at its disposal to hold the ECB accountable are the so-called ‘monetary dialogues’. These are regular hearings between the ECB’s President and Members of the Parliament’s Committee on Economic and Monetary Affairs, during which the latter quiz the former on the decisions and actions of the Central Bank. As watchdogs of the ECB, Positive Money Europe follows closely this oversight mechanism, which we have indeed analysed over the years and proposed to strengthen and improve.
Ahead of the last monetary dialogue in June, we went one step further, involving our supporters in the process: in cooperation with our partner SumOfUs, we collected through a survey the opinions and questions on ECB policies of more than 8,000 supporters, asking them about their economic and social concerns; their views on the environmental consequences of the ECB’s actions; and on how to keep this institution in check. We then shared the results with Members of the European Parliament (MEPs), inviting them to bridge the voice of the citizens they represent during their dialogue with ECB President, Christine Lagarde.
The survey shows interesting results. First off, it demonstrates the widely shared idea that the ECB must act quickly and with the ambition to stop the funding of the fossil fuel industry. At the same time, respondents have voiced their willingness for the ECB to take an even more proactive approach to address the environmental breakdown, with 95% thinking that EU institutions should encourage the ECB to finance home renovation and energy transition projects for people. The climate and environmental crisis represents indeed the main concern for more than 63% of respondents, followed by poverty and inequality as the second major concern (20.1%), and cost of living and price increases as the third one (8.4%).
On the current rising cost of living, the survey has revealed another crucial aspect. When we asked people whether they were worried about the ECB hiking interest rates, 35.6% said they were, while 29.4% said they were not. However, more than a third of respondents said they were not sure how to answer: this uncertainty highlights the need for broader and clearer communication by the ECB about the meaning of its decisions and their effects on people’s lives.
Following this important finding, MEPs Rasmus Andresen and Ernest Urtasun brought the issue to the ECB’s attention, by presenting a question for written answer to the Central Bank, which is a further accountability tool that MEPs can use to ask the ECB to provide clarifications and reasons for its actions.
While waiting for the ECB’s response, we keep up our commitment to translate the policies of this powerful EU institution into plain English, and to engage people in the debate about its decisions. Monetary policy is not an abstract entity distant from our lives. On the contrary, it has a huge impact on prices, inequality, employment, climate change – all things that matter to people. The ECB must therefore listen to people, and establish a consistent and clear dialogue with them, as they are the ones it’s born to serve.