The compliance tracker of the secretariat of the European Fiscal Board documents the fiscal performance of EU Member States vis-à-vis the rules of the Stability and Growth Pact (SGP). The results are summarised and presented below. Relevant concepts and definitions can be found in a dedicated note published in Intereconomics, 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., J. Malzubris, S. Santacroce. 2023. “Numerical compliance with EU fiscal rules: Facts and figures from a new database.” Intereconomics, 58(1): 32-42.
Overall compliance scores
(Overall compliance scores are calculated as averages over 1998-2023 and the four fiscal rules of the SGP)
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 within or outside the perimeters defined by the fiscal rules.
The database encompasses the four main fiscal rules of the SGP:
- Deficit rule: a country is compliant if (i) the budget balance of general government is equal or larger than -3% of GDP or, (ii) in case the -3% of GDP threshold is breached, the deviation remains small (max 0.5% of GDP) and limited to one year.
- Debt rule: a country is compliant if the general government 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 (i) the structural budget balance of general government is at or above the medium-term objective (MTO) or (ii) the annual improvement of the structural balance is equal or higher than 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 ensure an adjustment of the structural budget deficit in line with the structural balance rule.
