Proposal for a Regulation on the effective coordination of economic policies and multilateral budgetary surveillance and repealing Council Regulation (EC) No 1466/97

Summary:

Legislative initiative - tabled by the European Commission on 26 April 2023 - seeking to replace Council Regulation (EC) No 1446/97 on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies.

Further information:

Regulation (EC) No 1466/97 set out the rules aimed at the monitoring and coordination of budgetary policies of the Member States of the European Union (EU), in what is known as the preventive arm of the Stability and Growth Pact (SGP). It established the European Semester cycle. This framework was later amended by Regulation (EU) No 1175/2011 to take into account the lessons of the global financial crisis and the Euro area sovereign debt crisis, as part of the so-called Six-Pack.

The original Regulation contains a review clause whereby every five years the European Commission is required to publish a report on its application. The latest review was undertaken as part of the review of the EU's economic governance framework, launched in February 2020. It revealed a number of strengths, but also a series of shortcomings of the framework. In November 2022, the Commission put forward its orientations for a reform of the framework. These envisaged a stronger national ownership, a simplified framework and a move towards a greater medium-term focus, combined with stronger and more coherent enforcement.

The proposed Council Regulation was adopted by the European Commission on 26 April 2023 as part of a legislative package seeking to reform the EU's fiscal framework. The European Parliament's relevant committee adopted a negotiating position on the draft law on 11 December. The Council of the European Union adopted its general approach to the text on 21 December. An informal agreement between the co-legislators on a compromise text for this file was reached on 10 February 2024.

• Primary Source

Official

European Parliament: Legislative Observatory: Procedure File for Proposal on Effective coordination of economic policies and multilateral budgetary surveillance (2023/0138(COD)) https://oeil.secure.europarl.europa.eu/oeil/popups/ficheprocedure.do?lang=en&reference=2023/0138(COD)

European Parliament: Legislative Train Schedule: Review of the economic governance framework (CWP 2023) https://www.europarl.europa.eu/legislative-train/theme-an-economy-that-works-for-people/file-economic-governance-review-(cwp-2023)

European Commission: Economy and Finance: Economic and fiscal governance https://economy-finance.ec.europa.eu/economic-and-fiscal-governance_en

European Commission: Press Release, 26/04/2023: Commission proposes new economic governance rules fit for the future https://ec.europa.eu/commission/presscorner/detail/en/ip_23_2393

European Commission: Questions and answers: Commission proposes new economic governance rules fit for the future (26 April 2023) https://ec.europa.eu/commission/presscorner/detail/en/qanda_23_2394

European Commission: Remarks by Executive Vice-President Dombrovskis and Commissioner Gentiloni at the press conference on the review of the EU's economic governance framework (26 April 2023) https://ec.europa.eu/commission/presscorner/detail/en/speech_23_2467

European Parliament: Press Release, 11/12/2023: Economic governance reform: improving credibility, ownership and scope for investment https://www.europarl.europa.eu/news/en/press-room/20231207IPR15733/

Council of the European Union: Press Release, 21/12/2023: Economic governance review: Council agrees on reform of fiscal rules https://www.consilium.europa.eu/en/press/press-releases/2023/12/21/economic-governance-review-council-agrees-on-reform-of-fiscal-rules/

Council of the European Union: Press Release, 10/02/2024: Economic governance review: Council and Parliament strike deal on reform of fiscal rules https://www.consilium.europa.eu/en/press/press-releases/2024/02/10/economic-governance-review-council-and-parliament-strike-deal-on-reform-of-fiscal-rules/

European Commission: Press Release, 10/02/2024: Commission welcomes political agreement on a new economic governance framework fit for the future https://ec.europa.eu/commission/presscorner/detail/en/ip_24_711

European Parliament: Press Release, 10/02/2024: Deal on EU economic governance reform https://www.europarl.europa.eu/news/en/press-room/20240205IPR17419/

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ESO Records

Review of the European Union’s economic governance framework https://www.europeansources.info/record/review-of-the-european-unions-economic-governance-framework/

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