CESifo/165 Violations of the EU Deficit Criterion/23 May 2016
In 165 instances, EU states have violated the three-percent hurdle for budget deficits. In only 51 cases was this permissible because the respective countries were in recession, the Ifo Institute reported on Monday, citing the latest figures of the EU Commission. In 114 cases it was not permissible. “The number of violations is astonishing. Apparently, the rules do not work. In none of these cases were fiscal sanctions imposed, as is actually foreseen. This is why other mechanisms are needed”, said Ifo President Clemens Fuest. Only a few days ago, Commissioner Pierre Moscovici had delayed a corresponding procedure against Spain and Portugal. The worst offender is France with 11 violations, ahead of Greece, Portugal and Poland (10 each), United Kingdom (9), Italy (8), Hungary (7) as well as Ireland and Germany (5 each). In contrast, strong budgetary discipline was evident in Luxembourg, Estonia, Finland, Denmark and Sweden, each with 0 violations. For its calculations, the Ifo Institute evaluated figures of the EU Commission ranging from 1999 to 2015.
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