Budgetary impact of new economic governance rules and the need for methodological transparency

Question for written answer E-002213/2024
to the Commission
Rule 144
João Oliveira (The Left)

The consequences of budgetary constraints caused by years of following EU rules are plain to see in Portugal, in the erosion of public investment, public services and the social functions of the state.

A recent study shows that the application in Portugal and Finland of the new EU economic governance rules would lead to even deeper budget cuts than those introduced under the rules of the already burdensome Stability Pact. Hungary would also suffer more, if it were to adopt a seven-year plan.

Even the IMF has acknowledged that 'on average, fiscal consolidations do not reduce debt-to-GDP ratios'.

What is more, the methodology used in the debt sustainability analysis is opaque.

Given all that, it is essential that we find out how the effects of the new rules are being assessed and how the rules will be reflected in the state budget, particularly with regard to stipulations concerning public investment and the financing of the social functions of the state.

In view of the above:

• 1.What is the Commission's assessment of the negative effects of the new fiscal rules on these countries, especially Portugal, and what has it said to the Portuguese Government about this matter?
• 2.What steps will it take to make the debt sustainability analysis methodology transparent?

Submitted: 22.10.2024