How can the Stability and Growth Pact be improved to achieve both stronger discipline and higher flexibility?

摘要

While we are sceptical of re-opening the debate on the SGP,26 we think that its functioning can nonetheless be improved. Our main proposals concern redefining the medium-term budgetary targets, improving transparency, tackling the pro-cyclical fiscal bias in good times, moving towards non-partisan application of the rules and improving transparency in the data. This set of ideas allows the achievement of both stronger discipline and higher flexibility and can be implemented without requiring any major revision of the existing rules. These proposals do not provide a recipe for tackling the problems encountered by countries still in transition towards lower deficits in the event of a cyclical slump. Nevertheless, if implemented, they would limit the type of behaviour which is largely responsible for the current fiscal tensions. He is also a member of the Panel of Experts of the Committee on Economic and Monetary Affairs of the European Parliament for which this article was written as a Briefing Paper (November 2002).