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European Commission criticised for policing of national budgets

European Commission

Dutch finance minister Jeroen Dijsselbloem has criticised the European Commission over the way it scrutinises the national budgets of countries across the continent, adding that the recent decision to give Spain and Portugal an extra year to bring their budget deficits back within EU limits had raised a lot of questions over whether the rules were being applied correctly.

Mr Dijsselbloem, who as president of the Eurogroup is widely regarded as leading official within the Eurozone, told a hearing at the European Parliament that a number of governments have expressed concerns that certain countries were receiving better treatment than others.

The approach to Spain and Portugal was cited as having taken a particularly strong toll on the credibility of Europe's fiscal rules, leading to Mr Dijsselbloem stating that the move should be reviewed by finance ministers.

Mr Dijsselbloem's assessment comes amid recent comments made by the president of the European Commission, Jean-Claude Juncker, who claimed that France was being given more time to meet budgetary targets "because it is France".

The Dutchman continued by stating that a number of countries were struggling to understand those comments, and that a number of smaller states had growing concerns when compared to larger nations, amid allegations of preferential treatment.

According to the Financial Times, his remarks are further proof that an increasing number of countries are viewing the issue of national budgets as something that has become increasingly politicised in recent years, with several high-profile figures in Germany calling for the commission to hand over its role as a fiscal watchdog to a more independent body.

The decision to grant an extra year to Spain and Portugal has been combined with a decision to impose sanctions until after the Spanish general election, which is due to take place later this month.

But in his latest speech, Mr Dijsselbloem said that the responsibility for better policing of the rules lies with the commission.
“I think the commission really has to understand that the pact is in their hands,” he said, in reference to the so-called Stability and Growth Pact that sets debt and deficit limits for euro area nations.

“If member states feel that the commission’s decisions are very hard to understand and very hard to predict, and are not objective, are perhaps distinguishing between small member states and large member states, that is a very big worry,” he said. “I can sense it during the eurogroup meetings that ministers are becoming a little concerned about this.”