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Covid: Brussels suggests maintaining the suspension of budgetary rules in 2022

2021-03-03T11:49:33.427Z

Brussels suggested Wednesday to maintain in 2022 the suspension of the rules of strict budgetary discipline imposed on member states, in force since March 2020 due to the crisis linked to the coronavirus. For the European Commission, the decision to maintain or not this suspension must " be taken after an overall assessment of the state of the economy ", using " the level of economic activity " co



Brussels suggested Wednesday to maintain in 2022 the suspension of the rules of strict budgetary discipline imposed on member states, in force since March 2020 due to the crisis linked to the coronavirus.

For the European Commission, the decision to maintain or not this suspension must "

be taken after an overall assessment of the state of the economy

", using "

the level of economic activity

" compared to "

the levels before the crisis

”at the end of 2019, as“

the main criterion

”.

To read also: Budgetary discipline: Paris wants to "review" the European rule of 3%

"

The current preliminary indications suggest to continue to apply the general exemption clause in 2022 and to deactivate it from 2023

", she adds in a communication.

The activation of this clause was decided by the Member States, after a proposal from the Commission, in March 2020.

This measure, which had never been used since its creation in 2011 in the midst of the euro zone debt crisis, allows member states to temporarily derogate from the Stability and Growth Pact, which sets the budgetary rules for states having adopted the single currency.

Among the obligations that capitals no longer have to meet is the famous rule requiring that their public deficit remains below 3% of their gross domestic product (GDP).

Reform in sight

After this suspension, Europeans announced billions of euros in public spending to help their health systems and support their economies, businesses and labor markets in the face of the impact of the pandemic.

The EU has also decided on a recovery plan of 750 billion euros financed by unprecedented common debt.

At the same time, the EU is considering a reform of these budgetary rules, once the pandemic has passed, a question which for the moment divides the member states.

The pandemic continues to damage (...) the economy.

To cushion this impact and promote a resilient and sustainable recovery, our message is that budget support must continue for as long as necessary,

”Commission Vice-President Valdis Dombrovskis said at a press conference.

Source: lefigaro

All business articles on 2021-03-03

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