European Economy. Public Finances in EMU-2006

Abstract

One year has passed since the EU Heads of State and Government endorsed the main elements for reforming the Stability and Growth Pact (SGP), on the basis of ideas put forward by the Commission in a Communication in September 2004. The Commission had suggested that an enriched common fiscal framework with a strong economic rationale would allow differences in economic situations across the enlarged EU to be better catered for and would contribute to greater credibility and ownership of the SGP in the Member States, building on the culture of sound fiscal policy established in the EU over the last decade.