The activities of the Organisation for Economic Co-operation and Development (OECD) in 2012-2013
- Author(s):
- Parliamentary Assembly
- Origin
- Assembly
debate on 1 October 2013 (30th Sitting) (see Doc. 13301, report of the Committee on Political Affairs and Democracy,
rapporteur: Mr Van der Maelen; and Doc. 13313, opinion of the Committee on Social Affairs, Health
and Sustainable Development, rapporteur: Mr Ghiletchi). Text adopted by the Assembly on
1 October 2013 (30th Sitting).
1. The Parliamentary Assembly of the
Council of Europe, enlarged to include the delegations of the national parliaments
of the Organisation for Economic Co-operation and Development (OECD)
member States which are not members of the Council of Europe, as
well as a delegation of the European Parliament, is once again considering
the activities of the OECD. The enlarged Assembly has reviewed the
activities of the OECD in 2012-2013 in the light of the reports
by the organisation and the report prepared by the Committee on
Political Affairs and Democracy.
2. In line with the objectives of the Assembly’s reform and the
desire to make the debate more political, the present report on
the activities of the OECD focuses on the challenges to citizens’
trust in democratic institutions posed by ineffective policy responses
and by evidence of fiscal injustice in the course of the ongoing economic
and employment crisis.
3. The enlarged Assembly notes the context of the world economy
against which the activities of the OECD have been conducted in
2012-2013. There are at last signs of a recovery, most notably in
North America, Japan and the United Kingdom, and the euro area as
a whole is no longer in recession. A sustainable recovery is, however,
not yet firmly established and unemployment remains high.
4. In terms of promoting growth of the global economy, it is
essential that the OECD strengthen relations between both member
countries and non-member countries that play an important role in
the world economy. In this context, the enlarged Assembly notes
with satisfaction that negotiations for the accession of the Russian Federation
to the OECD are continuing. It also notes the OECD decision to embark
on a new round of accessions as set out in the Resolution of the
(OECD) Council on Strengthening the OECD’s Global Reach, with an
invitation to Colombia and Latvia to begin accession discussions
this year and with a view to taking decisions to open accession
discussions with Costa Rica and Lithuania in 2015. Furthermore,
the enlarged Assembly also welcomes the OECD’s decision to launch
the regional programme for South-East Asia to strengthen its ties
with the strategic priority countries in addition to the close collaboration
with its key partners.
5. Against the background of a hesitant global economic recovery,
the OECD Secretary-General has set an agenda for the Organisation
for the coming year covering three broad areas: inclusiveness and
growth; interconnectedness for growth; and institutions and governance
for growth. At national level, governments urgently need to restore
growth and competitiveness, reduce unemployment, in particular among
young people and the long-term unemployed, rebuild confidence, address
inequalities and boost job quality. At the same time, governments
face global challenges including the further deepening of globalisation,
poverty, rapid population ageing, migration, climate change, growing
natural resource scarcity, and a global economy based on knowledge
and skills.
6. Development is at the core of efforts to achieve a fair and
equitable global economy. With the 2015 deadline for the Millennium
Development Goals now close at hand, the enlarged Assembly welcomes
the OECD’s drive in the context of its Strategy on Development to
achieve Policy Coherence for Development and to strengthen engagement
and knowledge sharing with developing countries. It looks forward
to further progress in mainstreaming development into the Organisation’s
work.
7. Adequately resolving environmental challenges will be crucial
to successful global development. With this in mind, the enlarged
Assembly welcomes the OECD’s efforts to mainstream its Green Growth
Strategy into core policy areas, while it continues to emphasise
the importance of innovation. It looks forward to further progress
in the OECD’s work on indicators and other measurement tools and
in its drive to integrate green growth considerations into regional
and multilateral policy.
8. Successfully addressing the employment crisis is one of the
biggest challenges facing governments. The enlarged Assembly welcomes
ongoing work in the context of the OECD’s Skills Strategy, launched
in May 2012, to ensure that today’s young people are equipped with
the skills that will be needed in tomorrow’s changing employment
market. Important milestones will include the launch in October
2013 of the OECD’s first Skills Outlook, based on the results of
its Survey of Adult Skills (as part of the Programme for the International Assessment
of Adult Competencies – PIAAC), and the publication in December
2013 of the latest results of the Programme for International Student
Assessment (PISA) a triennial evaluation of competencies of 15-year-old
school students. The enlarged Assembly invites the OECD to work
with national governments to develop integrated approaches at both
national and local levels that cover not only how skills are provided
by education and training systems, but also how firms promote the
acquisition of the skills they need and how they utilise them in
the production process.
9. The enlarged Assembly recognises the importance of addressing
social inequities and implementing suitable measures to alleviate
employment issues as part of the achievement of sustainable and
inclusive growth, which will help restore confidence in our governance
systems. In this context, the enlarged Assembly welcomes the fact
that the 2013 OECD Ministerial Council adopted the Recommendation
on Gender Equality in Education, Employment and Entrepreneurship
and committed to deliver progress on gender equality. It also encourages
the OECD to strengthen its efforts to address inequalities.
10. While the enlarged Assembly notes the necessity for many OECD
member States to deal with a sovereign debt crisis, it also supports
the call of the Trade Union Advisory Committee to the OECD (TUAC) that,
“financing fiscal consolidation through cuts in public services,
in social security and pensions would only prolong the jobs crisis
and risk a social crisis”.
11. Holistic policies taking account not only of employment challenges
but of all aspects of individual countries’ economic realities hold
the key to successful emergence from the crisis. In this context,
the enlarged Assembly notes with satisfaction the ongoing work in
the framework of the OECD’s New Approaches to Economic Challenges
(NAEC) initiative. Launched in May 2012, this endeavour to draw
lessons from the crisis aims to promote a broader notion of growth
that also considers other important outcomes such as well-being, inclusiveness
and environmental sustainability. The enlarged Assembly furthermore
invites the OECD to use this initiative to examine the risks posed
by covert banking activities and propose measures for improving supervision
and regulation, as recommended by the G20 Summit held in St Petersburg
on 5 and 6 September 2013.
12. The enlarged Assembly recalls the OECD Secretary-General’s
response to the Assembly last year that, “OECD policy advice should
be strengthened by continuing to upgrade [its] analytical skills”.
Therefore it urges the OECD to press ahead with the NAEC initiative
with a view to reporting at the 2014 Ministerial Council on the
NAEC, including clear policy proposals. The Assembly also recognises
the need for each government to restore confidence by adopting reform
measures promoted through the NAEC proposal.
13. At a time when the crisis and its fallout have undermined
citizens’ confidence in democratic institutions, policy makers need
to take steps to rebuild trust in government. The OECD is developing
a policy agenda on trust designed to support efforts to build more
effective, more transparent and more open government institutions.
OECD work focuses on giving citizens a stronger voice in policy
development, making institutions more responsive to user needs and
enhancing the flow of information between governments and citizens.
In addition, building trust in government action means ensuring
high standards of integrity, particularly in high-risk areas such
as lobbying, public procurement and political financing. In today’s
increasingly complex and interconnected global economy, it is of
paramount importance that the burden of financing government expenditure
on necessary services and infrastructures should be seen to be fairly
shared. The enlarged Assembly welcomes the OECD’s work on transparency,
accountability and integrity issues.
14. The OECD has also increased its co-operation with key partner
countries (Brazil, China, India, Indonesia and South Africa) and
regions (South-East Asia, the Middle East and North Africa (MENA)
region, Latin America and Africa), and plays a key role in supporting
the G8 and G20 processes. It contributes to the latter with analysis
and data to better inform discussions on a variety of economic,
social and environmental issues, including those linked to structural
reforms in the context of the “Framework for strong, sustainable
and balanced growth”: employment, financial education and consumer
protection, anti-corruption, green growth, fossil fuel subsidies,
trade and investment and taxation. The organisation also plays an
active role in supporting the economic, social and political development
of the MENA region, in connection to the Deauville Partnership.
15. The enlarged Assembly also welcomes the OECD’s work on interconnectedness
for growth, in particular the creation, with the World Trade Organization
(WTO), of a new database on Trade in Value Added and its work on
Global Value Chains. This work has the potential to change our understanding
of global trade, investment and production patterns, highlighting
the importance of trade facilitation and service liberalisation, and
leading to a better measurement of both the gains from trade and
the costs of protectionism.
16. The OECD has taken a lead role in the international drive
to ensure tax fairness by cracking down on aggressive tax evasion.
Governments’ taxation policies, however, will also have to be adapted
to an increasingly globalised economy to ensure adequate fiscal
revenues and to maintain sound public finances. In this context,
the enlarged Assembly welcomes the OECD’s work on Base Erosion and
Profit Shifting (BEPS) and in particular the comprehensive and ambitious
G20/OECD Action Plan released in mid-July 2013 to address BEPS.
The enlarged Assembly urges the OECD to continue to take a determined
lead in reforming international rules for the taxation of multinational
corporations so as to adequately reflect production and trading
practices in today’s global economy. In addition, it recognises
the importance of governmental collaboration to co-ordinate tax
systems and thereby ensure that tax payers have confidence in them.
17. To ensure fair taxation of global profits and enhanced tax
compliance, the enlarged Assembly urges the OECD to:
17.1 improve data collection on BEPS
as such data are critical to monitoring the future implementation of
the G20/OECD Action Plan, including identifying the types of data
that taxpayers should provide, as well as the methodologies for
analysing these data to assess the likely economic implications
of BEPS and actions taken to address BEPS;
17.2 promote the obligation for transnational corporations
to produce comprehensive global financial reports, including country-by-country
reporting, as a first step towards a possible multilateral agreement on
a system of unitary taxation of transnational corporations;
17.3 push for a “Big Bang” approach requiring transparency
of beneficial ownership and automatic exchange of information for
tax purposes between all countries in order to ensure tax fairness
and compliance by both corporate entities and individuals;
17.4 develop mandatory disclosure rules regarding aggressive
or abusive transactions, arrangements or structures, with a focus
on international tax schemes;
17.5 propose measures for countering harmful tax practices
more effectively, giving priority to improving transparency, including
compulsory spontaneous exchange of rulings related to preferential regimes
and on requiring substantial activity for any preferential regime;
17.6 analyse the tax and public international law issues related
to the development of a multilateral instrument to enable jurisdictions
that wish to do so to implement measures developed in the course
of the work on BEPS and amend bilateral tax treaties accordingly;
17.7 promote international coherence of corporate income taxation,
so that the design of tax policy is better informed by the increasing
interconnectedness of economies and the gaps that can be created
by interactions between domestic tax laws;
17.8 do more to take account of the needs and interests of
developing countries in this respect, and to associate developing
countries more fully with the preparatory discussions and focus
groups that are addressing these various issues;
17.9 push for collaboration between the Global Forum on Transparency
and Exchange of Information for Tax Purposes, the OECD task force
on tax and development, the World Bank Group and other organisations
to help developing countries identify their needs as regards technical
assistance and capacity building.
18. The enlarged Assembly encourages the OECD to step up its fight
against the widespread aggressive tax evasion that continues to
be encouraged by tax havens and in particular to press internationally
for the implementation of arrangements for the automatic exchange
of information for tax purposes. The enlarged Assembly believes
that the OECD should strengthen its definition of a tax haven and
clarify which tax regimes can be categorised as harmful tax practices.
19. Finally, the enlarged Assembly welcomes the OECD’s leading
role in formulating various policy initiatives, such as employment
creation, its skills strategy, its development strategy, the promotion
of gender equality and works on global value chains, and on measuring
trade in value added terms. The enlarged Assembly also invites the
OECD to provide participants in the enlarged debate with information
on efforts made with regard to the issues referred to in this resolution
in a suitable manner, either prior to, or at the time of, the next
enlarged debate.
