Press Release: Public Finances in 2005: implementation of sound policies in line with the reformed Stability and Growth Pact is key

The European Commission on 1 June 2005 published its annual report on the state of public finances in the European Union. In the report the Commission called on Member States to live up to their renewed commitment to sound budgetary policies and pledges to implement forcefully the reformed Growth and Stability Pact. The report showed that the average budget deficit in the euro area and in the EU25 improved slightly in 2004 after having deteriorated for three consecutive years. But this was largely the result of a reduction in the comparatively higher deficits of the new Member States.