Font size:
Print
Excessive Deficit Procedure
Context:
The European Commission has proposed disciplinary measures against France and six other European Union countries for having excessive budget deficits.
More on News
- The EU executive arm singled out Belgium, France, Italy, Hungary, Malta, Poland, and Slovakia.
- Excessive deficit procedure will be the first disciplinary steps since the EU suspended and reformed its fiscal rules in 2020 to address high post-pandemic debt.
About Excessive Deficit Procedure (EDP)
- Under Article 126 of Treaty on the Functioning of the European Union (TFEU) and Stability and Growth Pact, it requires Member States to avoid excessive deficits.
- The EDP can be initiated if an EU country:
- Exceeds or risks exceeding the deficit threshold of 3% of GDP.
- Violates the debt rule by having a government debt level over 60% of GDP, which isn’t decreasing at a satisfactory rate.
- The gap between the country’s debt level and the 60% reference must be reduced by one-twentieth annually, on average, over three years.
