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Dáil Éireann díospóireacht -
Thursday, 6 Nov 2003

Vol. 573 No. 5

Written Answers. - Stability and Growth Pact.

Joan Burton

Ceist:

30 Ms Burton asked the Minister for Finance the discussions he has had with other EU Finance Ministers regarding possible changes in the Stability and Growth Pact, particularly with a view to easing borrowing restrictions; and if he will make a statement on the matter. [25763/03]

The rules of the Stability and Growth Pact were discussed by the Economic and Financial Affairs (ECOFIN) Council in March 2003. No changes were made but some recommendations regarding the effective application of the Stability and Growth Pact were agreed. The main recommendations in this regard were, that the economic cycle should be taken into account when assessing compliance; euro area member states with deficits exceeding the close to balance or in surplus requirement must improve their cyclically-adjusted budgetary position; member states should avoid pro-cyclical policies; and fourth, greater attention to be paid to analysing the long-term sustainability of public finances and greater emphasis will be placed on reducing debt levels and the quality of public finances. The Government supports the Stability and Growth Pact as the basis of stable public finances in the EU. I have made clear on a number of occasions that I would support changes to the pact which would give greater recognition to member states with debt levels below the 60% reference rate especially where such member states have pressing needs for capital investment. This proposal has been discussed by the relevant EU bodies but has not been proceeded with. I will continue to set out my views on the matter as appropriate in the context of future ministerial level meetings.

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