MEPs accuse troika of causing 'social tsunami'

Speaking with reporters following the vote, Cercas accused the troika - officials who manage bailout payments on behalf of EU and international lenders - as well as eurozone finance ministers, of riding roughshod over the EU treaties and creating a "social tsunami.”

"The arrogance of economic fixation has made policy makers forget that there are conventions which you must stick to … even in a crisis you can't reduce pensions below the breadline," he said.

"It's time for employment and these social benefits which have been destroyed by structural reforms need to be brought back," he noted, adding: "budgets are now balancing and we need to bring back those who have been left behind."

His report comes as parliament wraps up its inquiry into the troika, which has dictated economic reforms in four bailed-out EU states over the past four years: Greece, Ireland, Portugal and Cyprus.

The Cercas paper will be added to a similar study by the economic affairs committee.

The economic affairs committee’s co-rapporteurs, Austrian centre-right MEP Othmar Karas and French socialist Liem Hoang Ngoc, have called for the troika to be dismantled due to lack of democratic oversight on its work, in favour of a system directly accountable to the EU parliament.

The EU assembly will vote on an amalgamated text in plenary in March, but the outcome will not be legally binding.

The Cercas report also calls for an EU job recovery plan to help crisis countries deal with unemployment and to revitalise an the small business sector, which has been decimated by the crisis.

It is backed up by a study, out last month, by Andreas Fischer-Lescano, a professor of European law and politics at the University of Bremen, who also published a report saying several austerity measures required as part of bailout packages contravened the EU's Charter of Fundamental Rights, with which all of the bloc's legislation must comply.

For his part, Benoit Coeure, a European Central Bank board member, defended the troika in the parliament inquiry’s final hearing, however.

“Don't blame the fire brigade for fire damage,” he said, also on Thursday in Brussels.

“Unemployment has increased a lot between 2010 and 2013, of course … But that’s an inevitable process in a crisis, that you go through the adjustment,” he added.

Despite the wrath of the MEPs, there is disagreement in the house on how quickly to proceed with reform.

The centre-left S&D group wants the troika to be disbanded before the end of the Greek EU presidency in June - a move rich in symbolism.

But Karas' centre-right EPP group wants to wait until the eurozone bailout fund - the European Stability Mechanism - is made fully accountable to parliament, a development which has no fixed timeframe.