WRITTEN QUESTION E-0474/02 by Salvador Garriga Polledo (PPE-DE) to the Commission. Use of the early warning procedure for excessive national deficits.
Date: 2002-02-22
Institutions: European Parliament, Provisional data
Subjects: Germany, Portugal, application of EU law, budget deficit, stability pact

12.12.2002

EN

Official Journal of the European Communities

C 309 E/25

(2002/C 309 E/028)

WRITTEN QUESTION E-0474/02

by Salvador Garriga Polledo (PPE-DE) to the Commission

(22 February 2002)

Subject: Use of the early warning procedure for excessive national deficits

The possibility of a Member State breaching the letter and spirit of the Stability Pact by exceeding the
limits on national deficits means that the so-called early warning procedure needs to act efficiently to
preserve stability, particularly at this sensitive time marked by the introduction of the euro.

How determined is the Commission to apply this procedure scrupulously and without exception in order
to preserve the letter and spirit of the Stability Pact and serve as a warning to all Member States?

Answer given by Mr Solbes Mira on behalf of the Commission

(18 April 2002)

The Commission decision to recommend that an early-warning be issued to Germany and Portugal was
driven by the need to sustain credibility in the rules-based framework for budgetary surveillance in the
Economic and Monetary Union (EMU). The Commission gave a firm political commitment, in a Resolution
agreed by Heads of State and Governments and the President of the Commission at the European Council
of Amsterdam (16 and 17 June 1997), to act ‘in a manner that facilitates the strict, timely and effective
functioning of the Stability and Growth Pact’. Indeed, it is not just the credibility of the Pact which was at
stake. The whole process of multilateral surveillance and economic policy co-ordination would have been
called into question.

At its meeting of 12 February 2002, the Council decided not to endorse the Commission Recom-
mendation for an early warning. The reason given by the Council for not issuing an early warning is that
both the German and Portuguese made commitments which ‘… effectively responded to the concerns
expressed in the Commission recommendation …’.

For its part, the Commission stands by its decision to issue a Recommendation for an early-warning to
Germany and Portugal, but nonetheless welcomes the statement of
the
Commission acted in accordance with its responsibilities, and the re-affirmation that the early-warning
system is an important element of the Pact (1). To show its determination to apply this procedure whenever
necessary in future, the Commission asked for the following statement to be inserted into the official
minutes of the Council meeting:

the Ecofin Council

that

The Commission takes note of the statement of the Council, including the decision to close the

1.
early-warning procedure.

The Commission welcomes the commitments of Germany and Portugal, which respond to the

2.
substance of the concerns in the Commission Recommendation for an early-warning.

3.
The early-warning mechanism is an essential part of the preventive elements of the Stability and
Growth Pact. In order to prevent the occurrence of an excessive deficit, the Commission will use the
early-warning mechanism if and when the budgetary positions of Member States diverge significantly
from the medium-term budgetary objective or the adjustment path towards it.

(1) Conclusions of the 2407th meeting of the (Ecofin) Council, Brussels, 12 February 2002, Presse 6108/02, http://

ue.eu.int/Newsroom.