28 October 2014

European Commission: Statement by Vice-President Katainen on the Draft Budgetary Plans

France and Italy's budgets have been provisionally accepted. Katainen said more information is needed on the French budget for next year. The EC's autumn economic forecasts will be published on 4 November.

"Under the strengthened budgetary policy coordination introduced in 2013 and being implemented for only the second time this autumn, euro area countries are required to submit draft budgetary plans for the following year by 15 October. The European Commission must adopt an opinion on each of these by 30 November. However, in cases where the Commission identifies "particularly serious non-compliance with the budgetary policy obligations laid down in the Stability and Growth Pact", it is required to adopt its opinion within two weeks of the plans' submission.

Over the past two weeks, the Commission has carried out consultations with certain Member States to request further information or to highlight some initial concerns related to the draft budgetary plans they submitted. I want to welcome the fact that these Member States have responded constructively to our concerns.

After taking into account all of the further information and improvements communicated to us in recent days, I cannot immediately identify cases of "particularly serious non-compliance" which would oblige us to consider a negative opinion at this stage in the process."

Full press release

Full updated statement

 

European Voice: Commission defers budget battle

The European Commission will publish its autumn economic forecasts on Wednesday (4 November), adding more fuel to a fierce debate over the credibility of the European Union’s rules on fiscal discipline.

Those forecasts will include the Commission’s estimates of economic growth in the member states and their public deficits and debt. Two weeks later the Commission is scheduled to adopt its opinions on whether the budgets of member states in the eurozone comply with the requirement to keep deficits below 3% of gross domestic product. Those opinions will be an early test of the resolve and credibility of the new Commission headed by Jean-Claude Juncker, which assumes office on 1 November. Its opinions will then be debated by the eurozone’s finance ministers at a specially convened meeting on Friday 21 November.

Full article on European Voice (subscription required)

 

Wall Street Journal: EU could take action against members with excessive deficits

European Union authorities could still launch enforcement efforts against some countries for their budget plans, even though the EU found no major violations of the bloc’s budget rules in eurozone draft budgets for next year, EU economics commissioner Jyrki Katainen said Wednesday.

“It cannot be excluded that the commission may need to adopt steps under the excessive deficit procedure for some member states,” he said.

Mr. Katainen added that the commission still needs more details about the French budget for next year, which proposed to reduce the structural deficit—the actual deficit adjusted for the strength of the economy—by 0.5% of gross domestic product. “Exactly because we haven’t had time to analyze all the measures, we need more time,” Mr. Katainen said.

Full article on Wall Street Journal (subscription required)

 

Reuters: EU provisionally clears French, Italian budgets after tweaks

The European Commission provisionally accepted the budgets of France and Italy, saying on Tuesday that no euro zone states had submitted deficit plans for next year that seriously breached EU rules for fiscal stability.

A day after Paris and Rome amended their 2015 budgets in the hope of avoiding censure from the European Union executive, the economics commissioner said no national budget had been so out of line it need be rejected by an initial deadline of Wednesday. Detailed analysis will continue next month, Commissioner Jyrki Katainen added.

Noting intensive discussions with some governments since budgets were filed to Brussels two weeks ago, Katainen said: "I want to welcome the fact that these member states have responded constructively to our concerns."

Full article on Reuters

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