Over the past several years, the secretariat of the European Fiscal Board has collected data on budgetary policies in the EU Member States vis-à-vis the rules of the Stability and Growth Pact (SGP). The results can be accessed via our compliance tracker below. Relevant concepts and definitions can be found in a dedicated note which also discusses key facts and trends. The database underpinning the compliance tracker can be downloaded here.The correct way to quote it is:
- Larch, M. and S. Santacroce. 2020. “Numerical compliance with EU fiscal rules: The compliance database of the Secretariat of the European Fiscal Board”, May 2020.
The database assesses numerical as opposed to legal compliance with the rules of the SGP. Abstracting from legal interpretations or margins of discretion allowed by the letter or spirit of the law, it assesses whether in pure quantitative terms the relevant fiscal aggregates – the budget balance, the debt-to-GDP ratio or government expenditure – evolved in line with the main course of action implied by the rules or not.
The database encompasses the four main fiscal rules of the SGP:
- Deficit rule: a country is compliant if (i) the headline budget balance is at or above -3% of GDP or if (ii) an excess below -3% of GDP is small (i.e. 0.5% of GDP) and limited to one year.
- Debt rule: a country is compliant if the debt-to-GDP ratio is below 60% of GDP or if the excess above 60% of GDP has been declining by 1/20 on average over the past three years.
- Structural balance rule: a country is compliant if the structural budget balance is at or above the medium-term objective (MTO) or, if it is below the MTO, its structural fiscal effort (i.e. the change in the structural balance) is equal or higher than the benchmark requirement of 0.5% of GDP.
- Expenditure rule: a country is complaint if the annual rate of growth of primary government expenditure, net of discretionary revenue measures and one-offs, is at or below the 10-year average of the nominal rate of potential output growth minus the convergence margin necessary to adjust towards the MTO.