necessary, to counteract political incentives for unsound fiscal policies. third, decision - makers in national fiscal councils require personal independence. they should be appointed on the basis of their professional qualifications for a fixed term. they should be relieved of their duties only in exceptional circumstances, for example if they no longer fulfil the conditions required for the performance of their duties or if they have been found guilty of serious misconduct. fourth, fiscal councils require financial independence. that is, they require sufficient resources to deliver on their mandate. to this end, the financing of independent fiscal institutions should be outside of the government ’ s immediate discretion. they could, for example, be funded directly by parliament rather than from the government budget. calmfors, lars ( 2015 ), “ the roles of fiscal rules, fiscal councils, and fiscal union in eu integration ”, in harald badinger and volker nitsch ( eds. ), the routledge handbook of the economics of european integration, routledge. see calmfors ( 2015 ), op. cit. bis central bankers ’ speeches evidence suggests that, where these principles of independence are met, fiscal councils can improve budgetary discipline. 10 complementing national independent fiscal institutions with the european fiscal board ensuring sound public finances in europe will also require changes to the eu ’ s fiscal governance framework. european legislators should make it a priority to reduce the excessive complexity of the rules. a lack of transparency can make fiscal rules appear arbitrary and undermine their legitimacy. a review of the fiscal rules should add clarity and facilitate the assessment of compliance with them, while preserving their stability - oriented nature. the international monetary fund has made such proposals in the past. 11 the european commission has announced that it will come up with proposals to simplify the framework soon. 12 it can be argued that complexity results from a lack of trust in the institutions in charge of enforcing the rules, preventing full delegation and making it necessary to write an allencompassing contract that covers all possible states of the world. the institutional set - up therefore needs to be strengthened. in october last year the european commission published a decision setting up a european fiscal board ( efb ). 13 in line with the recommendations of the five presidents ’ report, the efb should provide an independent assessment of the commission and the council ’ s application of the stability and growth pact. while the european commission should continue to enforce these rules, it should provide a justification where it deviates from the views of the efb.

benoit cœure : the importance of independent fiscal councils opening remarks by mr benoit cœure, member of the executive board of the european central bank, at the workshop on “ fiscal councils, central banks and sound public finances ”, frankfurt am main, 27 january 2016. * * * summary setting the stage for a workshop at the ecb on fiscal councils, central banks and sound public finances, benoit cœure underlines in his opening remarks that sound public finances in all euro area member countries is a precondition for completing economic and monetary union. even if these days “ there is no appetite for moving towards a ‘ united states of europe ’ ”, he says, “ there is a common understanding ” that euro area member countries need to further integrate their fiscal and economic policies. benoit cœure focuses on the requirements that need to be met for national fiscal councils and the european fiscal board ( efb ) to be fully effective. “ independence ” is the key word at both national and european levels. the efb is also charged with the important task of coordinating fiscal policy in the euro area to avoid procyclical fiscal policies. “ at this juncture using fiscal space would speed up the euro area ’ s return to growth and support the ecb ’ s objective of medium - term price stability ”, says benoit cœure. “ but, in many countries, such fiscal space simply does not exist, because rules have not been enforced in the past. setting up independent institutions such as the fiscal councils at the national level and the efb at the european level could prove to be a decisive step in this direction. ” * * * dear guests from the network of eu independent fiscal institutions, dear colleagues from the european system of central banks, ladies and gentlemen, 1 it is a great pleasure for me to open this high - level workshop. the european sovereign debt crisis has reminded us painfully that sound public finances in all euro area member states are an indispensable prerequisite for the smooth functioning of the european monetary union. this has, of course, been well understood for a long time. for example, the delors report of 1989 stressed that “ uncoordinated and divergent national budgetary policies would undermine monetary stability and generate imbalances in the real and financial sectors of the community. ” 2 to address these concerns the maastricht treaty introduced a number of safeguards : the nobail - out clause, the excessive deficit procedure and the