Christian Lindner reacted irritably on Thursday. The Federal Government sees the intention of the EU Commission "extremely critical" to assess the budgets of the member states for 2024 already now according to the rules of a reformed EU Stability Pact, said the FDP Finance Minister in Rome. The reason for Lindner's anger is that the rules according to which the EU authority now wants to proceed are not yet on the table.

Werner Mussler

Economic correspondent in Brussels.

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Logically, they have certainly not been decided. The Commission endangers confidence in an "open-ended negotiation process," said the Minister. From government circles it was said at the weekend, not only in Berlin, but also in other capitals one was irritated.

The Commission has mixed up two separate facts in a "very unfortunate way": its regular budgetary advice to the states for 2024 and the still very shadowy discussion on the new budget rules, on which the authority has not yet submitted a legislative proposal. The responsible Vice-President Valdis Dombrovskis and Economic Affairs Commissioner Paolo Gentiloni had appealed on Wednesday to the governments to submit their budget plans in April according to the new rules in Brussels. So far, however, these rules only exist in the minds of Commission officials – or in drafts that they have in the drawer.

She believes that she already has the Member States in her pocket

The governments' displeasure is expected to be incorporated into a statement that the Eurogroup intends to adopt this Monday in Brussels. Originally, this was intended to refer only generally to the budget policy of the states this year and next. It is very likely that it will now also contain a passage in which the euro states object to the Commission's intention to anticipate the forthcoming discussion of the pact reform with its requirements. As long as there are no new rules, the old ones apply, said an EU diplomat.

There is a simple reason why the Commission is forging ahead: it believes that it already has the Member States in its pockets. Their negotiators have agreed in recent days on a consensus paper, which the EU finance ministers want to adopt on Tuesday as official Council conclusions. Despite the irritation with the Commission, this agreement does not appear to be at risk. On this basis – and after approval by the heads of state and government in ten days – the EU authority can get started and present a legislative proposal. This is expected in April at the latest. Subsequently, the European Parliament and the Member States discuss it. A compromise will not be reached until the end of the year at the earliest.

The Council paper contains a number of formulaic compromises, as Lindner confirmed in Rome. "We interpret the Council conclusions differently, this shows their absolutely provisional character," he said after talks with his Italian counterpart Giancarlo Giorgetti. At most, the Member States had reached a "stage in the formation of opinion". In fact, the conclusions of the legislation do not prejudge. However, the ministers make several pre-determinations in the sense of the Commission, behind which they can no longer go back.

Measuring on a "net spending" path

The reform of the pact primarily concerns the question of how countries with a debt ratio of more than 60 percent of economic output – currently 12 of the 20 euro countries are affected – can permanently reduce their debts. The finance ministers no longer question whether the Commission should negotiate bilaterally with the country concerned in the future. Furthermore, at the Commission's request, the debt analysis will be integrated from the outset into a "multiannual budget", i.e. detached from the usual annual control. The multi-year plan no longer refers generally to the 60 percent criterion of the Maastricht Treaty, but is based on the debt level of the individual country and is intended to "differentiate" according to its financial possibilities. This means that the rules no longer apply equally to all countries, but that a highly indebted country is treated less strictly.