Seven EU countries – including both France and Italy – risk fines for breaching the EU's budget rules.
No return to the austerity policy of the 2010s is promised, however.
In the EU Commission's economic spring package on Wednesday, it is proposed that formal procedures be initiated against Belgium, France, Italy, Malta, Poland, Slovakia, and Hungary. Ultimately, the processes could lead to fines or other measures if the countries do not take action to reduce their budget deficits.
The measures come as EU countries last year agreed to leave the economic exception regime that has been in place since the coronavirus pandemic took hold in the spring of 2020. As a result, member states are once again required to strive for a national debt equivalent to a maximum of 60 per cent of GDP and not have budget deficits exceeding three per cent of GDP.
At the same time, a reform of the budget rules was nailed down this year to increase flexibility and take into account specific situations in the affected countries.
The process is, however, lengthy. Recommendations on what countries should do are not expected until autumn.
Economy Commissioner Paolo Gentiloni also stresses that it is not about going back to the criticised austerity policy that dominated after the euro crisis.
We are coming from nearly four years under general exception rules, and therefore, our economic and budget policy is entering a new cycle. This does not mean a return to normal, for we do not live in normal times – and even less a return to austerity, which would be a terrible mistake, says Gentiloni at a press conference in Brussels.
