EU Ministers Want EU Budget Rules to Support Investment, Realistic Debt Cuts

European Union finance ministers said on Friday that changes to EU budget rules, now under review, should support investment in the post-pandemic economy and allow for a more realistic path in cutting some countries' huge public debts, Reuters reported. Finance ministers from the 27-nation bloc are starting discussions during a two-day summit in the Slovenian town of Brdo on how to amend the rules to better fit changed economic realities once they are reinstated from 2023. "We will need a debt reduction path that is realistic for all member states. We need to balance fiscal sustainability with the need to support the economic recovery," European Commission Vice President Valdis Dombrovskis said as he entered the talks. The rules, which set limits on borrowing by European governments to protect the value of the euro, are suspended until the end of 2022 to give member states more leeway in fighting the economic slump caused by the coronavirus pandemic. Discussions on changing them are likely to last well into next year, but some common themes are already emerging, such as the need to protect government investment, usually the first victim of any expenditure cuts during crises. "We need to avoid what happened in the previous crisis when public investments year by year reached level zero," EU Economic Commissioner Paolo Gentiloni said. Read more.