Today, the European Commission has adopted proposals for targeted changes to some of the EU economic governance rules. The changes are aimed at ensuring their consistency with the outcome of the comprehensive reform undertaken in April 2024 , while reducing reporting and administrative burdens, and streamlining funding arrangements for assisting non-euro area Member States facing balance of payments difficulties.
These proposals will simplify EU law, remove redundant administrative requirements, and make financial assistance more efficient. They will directly benefit national administrations by easing their administrative workload, making it easier to implement EU law, and enabling them to refocus resources on other tasks.
Streamlining EU economic governance rules
The Commission proposes to streamline certain elements of the EU economic governance framework related to fiscal surveillance. In particular, it proposes to amend the sanctions regulation (Regulation (EU) No 1173/2011) , and the Draft Budgetary Plan (DBP) regulation (Regulation (EU) No 473/2013) . These amendments will:
- Align the rules for the imposition of financial sanctions with the reformed Stability and Growth Pact by updating or removing obsolete provisions and by ensuring a graduated approach compatible with the amended corrective arm regulation;
- Fully align the Draft Budgetary Plan regulation with the reformed EU economic governance framework , addressing and eliminating inconsistencies and simplifying procedures and reporting obligations to improve the efficiency of fiscal surveillance;
- Reduce the reporting burden on Member States, generating savings in administrative costs while maintaining effective fiscal oversight.
Enhancing surveillance to boost financial stability
The proposals also amend the regulation on enhanced and post-programme surveillance for euro area Member States facing, or at risk of, serious financial difficulties ( Regulation (EU) No 472/2013 ). Under this amendment, the Regulation will:
- Clarify that enhanced surveillance applies when precautionary financial assistance requires new measures, ensuring a more targeted use of this surveillance;
- Refine post-programme surveillance so that its intensity can be better adjusted to the level of repayment risk and the need for corrective measures.
These changes will ensure that post-programme surveillance becomes better aligned with the Union economic governance framework, avoiding the overlap with other surveillance processes while maintaining its effectiveness in assessing repayment risks.
Making funding operations more efficient
For non-euro area Member States, the Commission proposes to simplify the funding arrangements of the balance of payments facility ( Council Regulation (EC) No 332/2002 ). This applies when non-euro area Member States encounter significant challenges in managing their international transactions, or are at risk of encountering such challenges, and the EU's support mechanism are used to assist them.
The current 'back-to-back' funding method – where each borrowing by the Commission is directly linked to a corresponding disbursement – will be replaced by a 'diversified' funding strategy, which is a more cost-effective and efficient way of supporting Member States. This approach is already being used successfully in other EU funding programmes, such as the Macro-Financial Assistance (MFA)+ for Ukraine , and NextGenerationEU .
Background
These proposed amendments also contribute to the Commission's simplification agenda, as set out in its February 2025 Communication on Implementation and Simplification, 'A Simpler and Faster Europe' .
