Brussels, 03/10/2002 (Agence Europe) - The Union of Industrial and Employers Confederation of Europe (UNICE) has called on Member States, "to maintain a strong commitment to the Stability and Growth Pact and the European Commission to be firm and rigorous in its interpretation of the rules". UNICE is worried that Portugal, France, Germany and recently Italy, "are all off course in their efforts to achieve a balanced budget by 2004". UNICE also points out that in recent years these, "countries failed to take advantage of a more buoyant economy to put their house in order and have therefore become more vulnerable as the economy has deteriorated".
With regard to the Commission's proposal to postpone the goal of balanced budgets from 2004-2006 (involving a commitment to reduce the GDP structural deficits by 0.5% annually), UNICE acknowledges that the Stability Pact, "does not spell out national structural deficits, which are difficult to identify and harder to remove". It is UNICE's view, however, that, "Member States must focus on refining analyses of the structural deficits that prevent them from making the necessary progress towards a balanced budget".
UNICE concludes that balanced budgets are, "a central element of the Stability and Growth Pact" because: they enable countries to take care of the increasing costs of the ageing population; they create enough room to allow automatic stabilisers to work; they help monetary policy to play its role in the policy mix; they build up EMU credibility inside and outside our borders; they improve the credibility of the euro.