Under the EU’s plans for new fiscal rules, only three member states (Denmark, Sweden and Ireland) could afford to meet their green and social investment gaps in 2027, according to a an analysis published by the European Trade Union Confederation (ETUC).
The European Commission proposed the new rules in April 2023 and a political agreement was reached in February 2024, aiming to restrict public spending to ensure debt sustainability, with EU governments required to keep their budget deficits below three percent of GDP and their public debt below 60 percent of GDP, while protecting investments in strategic areas.
“The proposed rules will put a straitjacket on member states and stop them from making even the minimum investment needed to reach the EU’s own social and climate goals,” said ETUC general secretary Esther Lynch, commenting on the report.
The ETUC report estimates that an additional €300-420bn a year (2.1-2.9 percent of EU GDP) would be needed to meet the needs of member states — and EU Commission figures show that investment in Europe’s social infrastructure is already €192bn a year below what is required.
“The EU’s own polling consistently shows that these are the priorities of European citizens and acting in complete contradiction to them just months before elections is a recipe for disaster,” said Lynch.
The European Parliament is expected to hold a final vote on the new fiscal rules during the last plenary session of this mandate, on 22-24 April in Strasbourg, and workers’ representatives are urging MEPs not to give them the green light.
“These limits on member states must not be approved,” Lynch warned.
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