We cannot put our children in debt: Europe needs growth and stable fiscal policy

2023. 05. 10.

The European Parliament debated the review of the Stability and Growth Pact (SGB) in plenary session yesterday. The instrument is designed to prevent Member States from falling into debt. In her speech, Fidesz MEP Enikő Győri pointed out that “we need a reform that ensures simplification and equality between member states, in addition to the balance between growth and fiscal stability.”

MEP Enikő Győri addressed five requests to the Commission:

  1. The budgetary balance of the Union and the Member States must be restored, and debt must be curbed. Debt target values are needed, without which the Commission can judge countries on uncertain grounds, thus undermining predictability and equal treatment.
  2. It is not clear based on what factors the Commission can propose an excessive deficit procedure (EDP) for a Member State. There must be adequate guarantees that the Commission does not abuse its powers.
  3. In this challenging environment, a flexible fiscal policy is needed, because it can provide sufficient leeway for manoeuvre in the event of disturbances in other sectors of the economy.
  4. The overburdening of the European Semester with new areas should be avoided, as this would only lead to further debates and a loss of scope.
  5. The powers of independent fiscal institutions vary greatly, so their regulation at the EU level should be handled with caution.

MEP Enikő Győri emphasized: “The balance between a credible, predictable, and sustainable debt reduction and the fiscal flexibility needed to meet the challenges can only be achieved if the Commission responds to these dilemmas”.