Recommendation for a

COUNCIL DECISION

abrogating Decision 2009/416/EC on the existence of an excessive deficit in Ireland

THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the Functioning of the European Union, and in particular Article 126(12) thereof,

Having regard to the recommendation from the Commission,

Whereas:

(1)On 27 April 2009, following a recommendation from the Commission, the Council decided, by Decision 2009/416/EC in accordance with Article 104(6) of the Treaty establishing the European Community, that an excessive deficit existed in Ireland. The Council noted that the general government deficit reached 6.3% of GDP in 2008, thus above the 3 % of GDP Treaty reference value and it was estimated to widen to 11% of GDP in 2009. The general government gross debt was projected to breach the 60 % of GDP Treaty reference value in 2009.

(2)On the same date, in accordance with Article 104(7) of the Treaty and Article 3(4) of Council Regulation (EC) No 1467/97, the Council, based on a recommendation from the Commission, issued a recommendation to Ireland to correct the excessive deficit by 2013 at the latest. That Council recommendation was made public.

(3)On 2 December 2009, the Council concluded that the Irish authorities had taken effective action in compliance with the Council recommendations of 27 April 2009, but that unexpected adverse economic events with major unfavourable consequences for government finances could be considered to have occurred in Ireland after the adoption of the original recommendation. Therefore, the Council, following a recommendation from the Commission, considered that the conditions envisaged in Article 3(5) of Regulation (EC) No 1467/97 were fulfilled and issued a new Recommendation to Ireland under Article 126(7) of the Treaty with a view to bringing the excessive deficit situation to an end by 2014.

(4)On 7 December 2010, the Council considered that unexpected adverse economic events with major unfavourable consequences for government finances, notably with reference to the substantial banking sector support measures that had to be implemented, had occurred in Ireland. Therefore, the Council following a recommendation from the Commission, issues a new Recommendation to Ireland under Article 126(7) of the Treaty, setting a 2015 deadline for the correction of the excessive deficit. At the same time, following the request by the Irish authorities for financial assistance from the European Union, the Member States whose currency is the euro and the International Monetary Fund (IMF), the Council addressed a decision to Ireland on granting financial assistance and on specific measures to restore financial stability and sustainable growth. The Memorandum of Understanding on Specific Economic Policy Conditionality (the "Memorandum of Understanding") between the Commission and the Irish authorities was signed on 16 December 2010.

(5)On 24 August 2011, the Commission concluded that Ireland had taken effective action towards correcting the excessive deficit by 2015 as recommended by the Council on 7 December 2010.

(6)In line with Article 10(2), letter (a), of Regulation (EU) No 472/2013, Ireland was exempted from a separate reporting under the excessive deficit procedure and reported in the framework of its financial assistance programme.

(7)In December 2013, Ireland successfully completed the EU-IMF financial assistance programme, with the vast majority of policy conditions under the programme met and investor confidence in the sovereign and the banking sector restored.

(8)In accordance with Article 4 of the Protocol on the excessive deficit procedure annexed to the Treaties, the Commission provides the data for the implementation of the procedure. As part of the application of this Protocol, Member States are to notify data on government deficits and debt and other associated variables twice a year, namely before 1 April and before 1 October, in accordance with Article 3 of Council Regulation (EC) No 479/2009.

(9)The Council should take a decision to abrogate a decision on the existence of an excessive deficit on the basis of notified data. Moreover, a decision on the existence of an excessive deficit should be abrogated only if (i) the Commission forecasts indicate that the deficit will not exceed the 3% of GDP threshold over the forecast horizon.

(10)Based on data provided by the Commission (Eurostat) in accordance with Article 14 of Regulation (EC) No 479/2009, following the April 2016 notification by Ireland, the 2016 Stability Programme and the Commission 2016 spring forecast, the following conclusions are justified: