Brussels, 25/06/2014 (Agence Europe) - José Manuel Durão Barroso, the president of the European Commission, says the European Commission is already making use of the flexibility in the stability and growth pact (SGP), which European heads of state will be discussing on Thursday 26 and Friday 27 June in their debate about the strategy to be pursued by the next European Commission and the best way to stimulate economic growth.
On Wednesday 25 June, Barroso said the SGP already provided enough flexibility and, in its assessment of respect of EU budget rules by the member states, the European Commission took account of the economic cycle and each country's individual circumstances, which is why it granted six member states extra time in 2013 to meet their budget targets on the condition that they introduced reforms and continued to consolidate public finances. Spain was granted an extra two years until 2016, France until 2015, Poland until 2014, Slovenia until 2015 and an extra year was granted to the Netherlands (until 2014) and Portugal (until 2015) (see EUROPE 10855).
Noting that, for two countries, the Commission goes too far in its interpretation of the rules but no member state is clearly calling for a change to the SGP (see EUROPE 11106), Barroso said that the Commission's budget policy recommendations were always unanimously endorsed by the Council of Ministers. He said that the Commission did not force anything on anyone, but would do all it could to ensure compliance with the rules shaped by the member states themselves.
Italy is very vigilant about such matters and says that there is more flexibility available in the SGP. Italy is no longer under proceedings for excess deficit and wants the deficit measurement rules changed to take account of the priority now being placed on structural reforms and investment in order to fan the green shoots of recovery. Italy is calling for a European investment fund to be set up, wider use of project bonds under the European budget to finance big infrastructure projects and for the European Investment Bank to see its capital increase by a further €10 billion. Italy also wants the creation of budget capabilities to help eurozone countries deal with the negative impact of the reforms they are introducing. (MB)