Commissie: Frankrijk en Duitsland op schema voor beperking begrotingstekort (en)

Based on an assessment of the budgetary situation of France and Germany showing that the two countries are on track to bring their budget deficits to or below 3% of GDP in 2005, the Commission today concluded that no further steps are necessary at this point under the excessive deficit procedure. However, the Commission stays vigilant as the budgetary situation in the two countries remains vulnerable. The assessment takes into account the July 2004 judgement of the Court annulling the November 2003 Council conclusions on Germany and France.

"In the light of the Court judgement and given the action taken by France and Germany it would appear that no further steps are required at this point" said Joaquín Almunia, European Commissioner for Economic and Monetary Affairs. But he added: "The budgetary situation remains vulnerable in the two countries. Should the corrective measures fail the Commission would have to recommend to the Council to enhance budgetary surveillance"

The Court judgement of 13 July 2004 annulled ;the Council conclusions of 25 November 2003, which purported to suspend the excessive deficit procedures^[1] vis-à-vis Germany and France and extend the original 2004 deadline for the correction of the deficits to 2005. In a communication to the Council the Commission finds that, in assessing the budgetary situation of the two countries, it should take into account the exceptional effects produced by the Council conclusions. In particular, until the annulment of the conclusions by the Court, Germany and France had reason to believe that they needed to correct their deficits by 2005 and frame their budgetary policies accordingly. Therefore, in the light of the unique circumstances created by the Court judgment, the Commission considers that 2005 should be considered as the relevant deadline. The Communication concludes that the two countries appear to be on track to correct their excessive deficits by 2005.

In Germany the general government deficit is projected to fall to 2.9% of GDP in 2005 from 3.9% of GDP in 2004. This projection is based on the macroeconomic scenario of the autumn forecast assuming GDP growth of 1.5% and including the 2005 budgetary plans and the additional savings package announced by the government on 4 November 2004. The latter contains a substantial one-off operation involving the securitisation of future incomes perceived by the cash settlement office responsible for pension payments to the civil servants of the former post public post office.

In France the general government deficit is projected to fall to 3.0% of GDP in 2005 from 3.7% of GDP in 2004. This projection is based on the macroeconomic scenario of the autumn forecast assuming GDP growth of 2.2% and including the 2005 budget. The latter includes a substantial one-off operation involving the transfer of the responsibility for pension payments of the employees in public electricity and gas companies to the social security sector.

The full text of the Commission's Communication on the situation of Germany and France in relation to their obligations under the excessive deficit procedure following the judgement of the Court of Justice can be found at:

http://europa.eu.int/comm/economy_finance/about/activities/sgp/main_en.htm ;

^[1] The EU budgetary surveillance framework implies that excessive deficits should be avoided. The excessive deficit procedure is regulated by Article 104 of the Treaty and further clarified in Council Regulation (EC) No 1467/97, which is part of the Stability and Growth Pact.