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MNI INTERVIEW: Robust Fiscal Rules Require EU Fiscal Capacity

Former top European Commission official Marco Buti talks to MNI about the EU's fiscal rules.

A credible enforcement of the new European Union’s new fiscal rules after their initial years of operation will require the European Commission to be able to raise its own funds to mitigate the social impact of fiscal adjustment, former top Commission official Marco Buti told MNI.

While the Commission is likely to announce mandatory fiscal adjustments for up to 11 member states including France and Italy on June 19, these will require tighter fiscal retrenchment once provisions allowing greater leeway for higher interest costs cease to be of assistance after the first three years of the seven-year programmes, said Buti, an important architect of the Commission’s original proposals for a new fiscal regime as chief of staff for Economy Commissioner Paolo Gentiloni between 2019 and 2023. (See MNI: EDPs Give EU Early Test Of New Fiscal Rules-Officials)

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A credible enforcement of the new European Union’s new fiscal rules after their initial years of operation will require the European Commission to be able to raise its own funds to mitigate the social impact of fiscal adjustment, former top Commission official Marco Buti told MNI.

While the Commission is likely to announce mandatory fiscal adjustments for up to 11 member states including France and Italy on June 19, these will require tighter fiscal retrenchment once provisions allowing greater leeway for higher interest costs cease to be of assistance after the first three years of the seven-year programmes, said Buti, an important architect of the Commission’s original proposals for a new fiscal regime as chief of staff for Economy Commissioner Paolo Gentiloni between 2019 and 2023. (See MNI: EDPs Give EU Early Test Of New Fiscal Rules-Officials)

Keep reading...Show less