Budgetary surveillance in the Euro area

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Dictamen del CESE: Budgetary surveillance in the Euro area

Key points:

 

With regards to the preventive element, and in consonance with the targets outlined in the Annual Growth Survey, it is proposed that the establishment of numerical targets for fiscal performance be based on a two-pronged system with top-down and bottom-up elements. The top-down element would focus on the establishment of a target determining the fiscal consolidation effort required for the entire euro area while the bottom up approach would entail the distribution of such effort into actions to be undertaken by individual Member States. This would reinforce, through a formal approach, the Commission’s efforts towards a stronger focus on country-specific circumstances in the application of the SGP.

The EESC further suggests that the imposition of interest bearing deposits, non-interest bearing deposits and fines is effected in a manner that these are directly funded, first and foremost, through the correction of policy elements which are leading to unsustainable fiscal positions. The latter would be determined through an assessment of deviations of revenue and expenditure elements from the convergence path as determined through the preventive arm. Furthermore, their value would be computed relative to the magnitude of expenditure and/or revenue elements which can be identified to be directly leading to the unsustainability of fiscal policy. This approach would be conducive to the enhancement of the quality of fiscal policy.

In order to foster a balance between incentives and punitive approaches in the corrective arm, the EESC proposes that interest on non-interest bearing deposits can be obtained by the Member State concerned once a reduction in public debt, which is at least equivalent to such interest and which is likely to be sustained in future, is achieved. Fines, on the other hand, would be directed to the European Stability Mechanism.