MNI BRIEF: EC Toughens New Fiscal Rules To Ease Germany Fears

The European Commission has added a number of tough new safeguard provisions to its proposal for fiscal rules reform in the hope of easing the concerns of Germany and frugal member states, with greater assurance that fiscal adjustment "is not postponed and that debt is returned to a prudent level at a sufficiently rapid pace,” according EU official said Wednesday.

The new provisions were in line with the report by MNI on April 5. (MNI: Brussels Toughens Up Fiscal Rules Proposals – Officials)

While tougher, it remains to be seen if this will be enough to assuage German concerns. In an op-ed in the Financial Times Tuesday, German Finance Minister Christian Lindner called for even stronger enforcement of the rules. The Commission says today that it is aiming for agreement this year on the new rules and that the new amendments were aimed at securing a “maximum of consensus”.

The new proposal also calls for stronger independent fiscal institutions to monitor fiscal policy in member states. EU finance officials will have their first discussion on the new proposal on 3^rd and 4^th May.