Negotiators for the European Parliament and the member states have reached a deal on small adaptations to the economic governance rules which will clarify and simplify implementation.
The latest revision of some of the regulations underpinning the EU’s economic governance framework aligns these regulations with the new framework created by the 2024 reform, while also simplifying some of the procedures in them.
During the negotiations MEPs secured some tweaks to the Commission’s proposals to ensure Parliament’s oversight role, as well as the transparency regarding how member states are monitored.
After the deal was reached the two rapporteurs for the European Parliament made the following comments:
Markus Ferber (EPP, DE), “Today’s compromise represents a genuine streamlining of an economic governance framework that had accumulated too much bureaucratic weight over the years. The agreement trims unnecessary reporting obligations, streamlines procedures and improves coherence across the framework, without touching the fiscal substance that underpins sound fiscal rules.
“This agreement must be a starting point, not a full stop. What we have done for economic governance, the Commission must now do for financial services legislation more broadly. There are many more areas, where we can get rid of duplicative reporting and contradictory requirements.”
Carla Tavares (S&D, PT), “With this agreement, we conclude the final stage of the EU economic governance review and ensure that the fiscal rules are fully ready for the next European Semester cycle, while remaining consistent with the compromise achieved in the 2024 reform.
“We secured a compromise that reduces unnecessary reporting and streamlines procedures, while preserving Parliament’s role, reinforcing the social dimension, and safeguarding the Union priorities agreed in 2024 — climate, digital, social, and defence.
“The new fiscal rules are a step closer to a simpler, more coherent framework and that is better adapted to today’s geopolitical challenges. The EU needs fiscal rules that can support investment, resilience and the strategic priorities in times of uncertainty, without returning to austerity and without having to suspend the framework whenever a new crisis emerges.”
Background
The agreement, composed of two texts revising three of the existing fiscal surveillance laws (Regulations (EU) No 1173/2011, (EU) No 472/2013 and (EU) No 473/2013), constitutes an alignment and simplification exercise intended to fully integrate the “Six-Pack” and “Two-Pack” rules into the reformed economic governance framework adopted in 2024. These three older laws had not been opened for revision in 2024 in order to expedite the adoption process.
The amendments will also introduce a number of simplifications in the 2011 and 2013 regulations, which will streamline the overall framework for EU economic governance, reduce the administrative burden on Member States and contribute to the Commission's simplification agenda.