The new, codified Regulation (EC) No 479/2009 on the application of the Protocol on the excessive deficit procedure annexed to the Treaty establishing the European Community has been published in the Official Journal.
It provides legal definitions of “government”, “government deficit”, “government surplus”, “government investment” and “government debt” for the purposes of the excessive deficit procedure.
The European Commission has proposed deadlines for the correction of the budget deficits of Greece, Spain, France and Ireland to the Council. EC also proposed a new deadline for the correction of the excessive deficit in the UK.
This is an important step forward in the procedure. Once the deadlines are approved by the Council, the Member States concerned will have six months to take effective action regarding budgetary outcomes in 2009 and to specify the measures that will be necessary to progress towards the correction of the excessive deficit.
We have to observe very carefully this procedure, since it will provide evidence about the practical enforceability of the Stability and Growth Pact.