Communication from the Commission to the Council and the European Parliament COM(2004) 425 final (144 kB)  

In the Communication on the state of Public finances in EMU 2004, the European Commission calls for achieving sound budgetary positions as a means to raise the growth potential in line with the Lisbon strategy. The Commission remarks that challenging developments have taken place in the last years, involving an increased activation of procedures for budgetary surveillance, and unwelcome tensions in the application of the EU framework. While there is a need to reassess the functioning of the framework, the conduct of fiscal policies in Europe should benefit from past experience and budgetary consolidations should be continued as economic conditions improve.

The Commission Communication is published at the same time as the fifth annual report on Public finances in EMU prepared by the Directorate General for Economic and Financial Affairs.  The report is part of Commission efforts to upgrade the analysis and surveillance of fiscal policies in EMU, and to place emphasis on the quality and sustainability of public finances as a means to increase their contribution to growth potential. Moreover, the report reviews ideas on how to strengthen the framework for economic governance and to improve its enforcement.

Individual chapters
Part I: Current developments and prospects  (256 kB)   (pdf file 250 kb)
Part II: Evolving budgetary surveillance  (516 kB)   (pdf file 500 kb)
Part III: The benefits of fiscal discipline  (285 kB)   (pdf file 280 kb)
Part IV: Quality of public finances: what role within the EU framework for economic policy coordination?  (239 kB)   (pdf file 230 kb)
Part V: Member States developments  (216 kB)   (pdf file 210 kb)
Part VI: Resources  (99 kB)   (pdf file 100 kb)
Statistical annex  (696 kB)    (pdf file 1040 kb)