MEPs in the Economic and Monetary Affairs Committee adopted three texts (see background below) with one containing substantial changes to the Commission’s original proposal, under the auspices of co-rapporteurs Esther De Lange (EPP, NL) and Margarida Marques (S&D, PT). The revised rules will constitute the backbone of the new EU economic governance system.

The most consequential of these texts will replace the regulation on multilateral budgetary surveillance, the so-called ‘preventive arm of the Stability and Growth Pact’.

More credibility

The text adopted by MEPs introduces minimum numerical values defining by how much a member state must reduce its excessive debt each year and how much it can overshoot on expenditure planning.

For countries with debt to GDP ratios between 60% and 90%, this ratio must reduce by at least 0.5% every year on average over the projected period (the period of time over which the fiscal adjustment takes place + 10 years), or by 1% for…