A decision on maintaining or lifting the freeze on the Stability and Growth Pact in 2022 will be taken “ before the summer”, so that each country can prepare its draft budgets for next year, said Portuguese Finance Minister João Leão on Tuesday 16 February, after the Ecofin Council, confirming the comments made the day before by the President of the Eurogroup, Paschal Donohoe (see EUROPE 12658/2).
In the meantime, euro area Finance Ministers will discuss the economic situation and its fiscal implications on a monthly basis (except in April), including the issues of more precise targeting and the changing nature of public support in relation to Covid-19 vaccination and a gradual lifting of health restrictions.
Any decision on the EU’s fiscal position for 2022 will be made on the basis of the spring economic forecasts expected at the beginning of May, said the Vice-President of the European Commission, Valdis Dombrovskis. He recalled that, “in early March”, the institution will contribute to the ministerial debates by detailing its interpretation of “the conditions for the reactivation” of the Stability Pact’s general escape clause and by providing “guidance” on the maintenance or gradual phasing out of fiscal support measures as the recovery takes hold.
As for the changing nature of public support to companies considered viable, he referred to the revised framework for State Aid in times of crisis which allows aid in the form of “equity” and “hybrid financing”. And to identify viable companies as those that were viable before the pandemic, since Covid-19 is an external event affecting the whole EU.
See the programme of discussions in the Eurogroup with a view to a position of the Nineteen on the fiscal rules to be adopted on 12 July: https://bit.ly/3qrFt8G (Original version in French by Mathieu Bion)