The Semester process makes sure that Member States keep their budgetary and economic policies in line with their EU commitments (debt and deficit commitments under the Stability and Growth Pact, economic reform plans enshrined in their 2013 country-specific recommendations, and the long-term growth and jobs targets in the Europe 2020 strategy).
The Annual Growth Survey will feed into national economic and budgetary decisions, which Member States set out in Stability and Convergence Programmes (under the Stability and Growth Pact) and National Reform Programmes (under the Europe 2020 strategy) in April. These programmes form the basis for the European Commission's proposals for country-specific recommendations in May 2014, which are adopted by the Council.
For the first time this year, euro area countries have also sent their draft national budgets to the Commission for its opinion on how they fit with the countries' commitments. The Commission's assessments will soon be made public, and will be discussed by the Eurogroup.
Boosting growth through the single market
The Single Market Integration Report analyses how the single market is functioning in key areas with the greatest growth potential, i.e. services, networks and digital economy. It points out where there may be gaps in implementation of common EU legislation in these areas.
The Commission’s second annual Report on Single Market Integration [653 KB] finds that while progress has been made in reforming the financial, digital and transport sectors, there is still work to be done to implement EU legislation on energy and services.
Budgetary surveillance during the European Semester
New rules for the euro area
Draft budget plans: Under new rules which came into force in 2013 (known as the Two Pack), euro area countries are required to submit draft budget plans to the Commission by 15 October each year, before they adopt their actual budgets.
- The European Commission has published its opinions on the 2014 plans submitted by 13 countries, giving an early signal of whether they are meeting their medium-term budgetary commitments.
- Based on the draft budget plans, the Commission has, for the first time, assessed the budgetary situation in the euro area as a whole (the Commission communication and its annex ).
Focus on structural reforms: The Two Pack rules provide for extra surveillance of euro area countries with excessive budget deficits (above 3% of GDP). The Commission has given its opinions on the Economic Partnership Programmes submitted by Spain, France, Malta, the Netherlands and Slovenia, which set out plans for structural reforms with a budgetary impact, designed to correct their deficits in a lasting way.
Next steps: The Commission's opinions are discussed by euro area finance ministers (the Eurogroup). In line with the new common budgetary timeline introduced by the Two-Pack, budgets have to be adopted by national parliaments by 31 December each year.
Following up the Excessive Deficit Procedure
All EU countries that breach the debt and deficit rules laid down in the Treaty are placed in the Excessive Deficit Procedure and subject to regular surveillance (every three or six months).
- The Commission has assessed the action taken by seven Member States that received new recommendations and deadlines on their deficits in June: Belgium, Spain, France, Malta, the Netherlands, Slovenia and Poland.
- The Commission has also sent reports to the Council assessing the reasons for an actual or forecast breach of the debt and deficit rules by Croatia, Lithuania and Finland.
Next steps: it is up to the Council to make a final decision on the action required in each case. The Commission continues with its surveillance of budgetary developments in all Member States throughout the year.