Finance checks
January 19, 2010
The European Commission claims it needs the power to audit national finances in the wake of Greece's financial meltdown. It wants to be able to make its own checks to ensure that countries do not let their budget deficits get out of control.
The topic was the focus of the agenda as European finance ministers met in Brussels.
Under EU rules, governments are required to keep deficits at less than three per cent of their gross domestic product. In October, Greece revealed a predicted deficit of 12.7 percent – having earlier said that it would be 3.5 percent.
Powers to prevent a repeat
The new powers are aimed at preventing a repetition of the situation, EU Economic Affairs Commissioner Joaquin Almunia said after the meeting on Tuesday. The measures would allow the Commission's statistical bureau Eurostat to double-check budget calculations, he said.
A similar request was made by Brussels in 2005, but countries objected to the idea of Eurostat "policing" their finances. Greece's turmoil has led to a rapid re-assessment of that decision.
"It's not enough to have notification from the budgetary authorities," Almunia said.
"Today, I hope that they will want Eurostat to play an active surveillance role. We need to get these new competencies," he said.
"The destiny of each of our countries in an economic and monetary union is the destiny of all," Almunia said.
Complaint of fraud
Before the meeting, Swedish Finance Minister Anders Borg had described Greece's failure to reveal the state of its finances for so long as "fraudulent."
But Austria's representative questioned the need to change the system. "You have only one case with statistical problems and then you change the entire system," said Austrian Finance Minister Josef Proell.
Spain's finance minister Elena Salgado, who chaired the meeting, said ministers might discuss the matter at an informal meeting in Madrid in April.
Ministers also talked about a Swedish call for a levy on bank liabilities, aimed at cracking down on reckless risk-taking.
rc/AFP/dpa
Editor: Susan Houlton