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Council Decision of 20 December 2010 amending Decision 2010/320/EU addressed to Greece with a view to reinforcing and deepening fiscal surveillance and giving notice to Greece to take measures for the deficit reduction judged necessary to remedy the situation of excessive deficit (2011/57/EU)
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- Penderfyniadau yn deillio o’r UE
- 2011 No. 57
- Introduction
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Council Decision
of 20 December 2010
amending Decision 2010/320/EU addressed to Greece with a view to reinforcing and deepening fiscal surveillance and giving notice to Greece to take measures for the deficit reduction judged necessary to remedy the situation of excessive deficit
(2011/57/EU)
THE COUNCIL OF THE EUROPEAN UNION,
Having regard to the Treaty on the Functioning of the European Union (TFEU), and in particular Article 126(9) and Article 136 thereof,
Having regard to the recommendation from the European Commission,
Whereas:
(1) Article 136(1)(a) TFEU foresees the possibility of adopting measures specific to the Member States whose currency is the euro with a view to strengthening the coordination and surveillance of their budgetary discipline.
(2) Article 126 TFEU establishes that Member States are to avoid excessive government deficits and sets out the excessive deficit procedure to that effect. The Stability and Growth Pact, which in its corrective arm implements the excessive deficit procedure, provides the framework supporting government policies for a prompt return to sound budgetary positions taking account of the economic situation.
(3) On 27 April 2009, the Council decided, in accordance with Article 104(6) of the Treaty establishing the European Community that an excessive deficit existed in Greece.
(4) On 10 May 2010, the Council adopted Decision 2010/320/EU(1) (hereinafter ‘the Decision’) addressed to Greece under Article 126(9) TFEU and Article 136 TFEU with a view to reinforcing and deepening fiscal surveillance and giving notice to Greece to take measures for the deficit reduction judged necessary to remedy the situation of excessive deficit at the latest by the deadline of 2014. The Council established the following path for the deficit correction: government deficit not exceeding EUR 18 508 million in 2010, EUR 17 065 million in 2011, EUR 14 916 million in 2012, EUR 11 399 million in 2013 and EUR 6 385 million in 2014.
(5) According to the forecast available at the time the Council adopted the Decision, real GDP was expected to contract by 4 % in 2010 and 2,5 % in 2011, and recover afterwards, with growth rates of 1,1 % in 2012, and 2,1 % in 2013 and in 2014. GDP deflator was expected to be 1,2 %, – 0,5 %, 1,0 %, 0,7 % and 1,0 % for the years 2010 to 2014, respectively. Given economic developments, real GDP is now expected to contract by 4,25 % in 2010 and 3 % in 2011 and recover afterwards with growth rates of 1,1 % in 2012, and 2,1 % in 2013 and in 2014. GDP deflators are now expected to be 3,0 %, 1,5 %, 0,4 %, 0,8 % and 1,2 % for the years 2010 to 2014, respectively.
(6) On 7 September 2010, the Council adopted Decision 2010/486/EU(2) amending the Decision.
(7) On 15 November 2010 Eurostat validated the Greek government deficit and debt statistics, in accordance with Council Regulation (EC) No 479/2009 of 25 May 2009 on the application of the Protocol on the excessive deficit procedure annexed to the Treaty establishing the European Community(3). On that occasion, the deficit and debt series for the years 2006-2009 were revised upwards. The government deficit ratio-to-GDP for 2009 was revised from 13,6 % of GDP to 15,4 % of GDP, while the debt ratio was revised from 115,1 % of GDP to 126,8 % of GDP.
(8) Greece has made good progress in the implementation of the measures required by the Decision, including the reduction of government deficit. However, the aforesaid revision in statistical series along with weak revenue collection and other problems with budgetary implementation, including the accumulation of payables, imply that the government deficit ceiling for 2010 will most likely be missed. This slippage will have to be fully offset in the course of 2011.
(9) On 24 November 2010, Greece submitted to the Council and the Commission a report outlining the policy measures taken to comply with the Decision. The Commission assessed the report and concluded that Greece is satisfactorily complying with the Decision.
(10) In light of the above considerations, it appears appropriate to amend the Decision in a number of respects, while keeping unchanged the deadline for the correction of the excessive deficit and the adjustment path for the government deficit and the increase of government debt in nominal terms,
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