The basic rules remain the same: the budget deficit may not exceed three percent of gross domestic product and the maximum permitted national debt is 60 percent. The new rules will give countries that do not meet these conditions more time to step up their efforts.
“These were tough negotiations,” says outgoing Finance Minister Kaag. “But I am happy that after long discussions there has been a good agreement. It is important that a solid foundation is laid for national budgets with clear rules and that everyone adheres to them.”
Discussion
There has been discussion about the budget rules for a long time. Countries such as Italy and France have not adhered to budget rules for years, but have never been punished for this. This irritates ‘frugal’ countries such as the Netherlands and Germany. They were prepared to agree to flexible rules, if compliance also became stricter.
The new budget rules give countries with a high national debt more time to get their finances in order. That period can be extended even further if a country makes investments in climate or defense. If a Member State consciously does not adhere to the budgetary rules, sanctions will follow.
The agreement was preceded by weeks of intensive negotiations. Before the new rules come into effect, agreement must be reached with the European Parliament.
2023-12-20 18:24:28
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