http://www.legislation.gov.uk/id/eur/2013/877

Commission Delegated Regulation (EU) No 877/2013

of 27 June 2013

supplementing Regulation (EU) No 473/2013 of the European Parliament and of the Council on common provisions for monitoring and assessing draft budgetary plans and ensuring the correction of excessive deficit of the Member States in the euro area

THE EUROPEAN COMMISSION,

Having regard to the Treaty on the Functioning of the European Union,

Having regard to Regulation (EU) No 473/2013 of the European Parliament and of the Council of 21 May 2013 on common provisions for monitoring and assessing draft budgetary plans and ensuring the correction of excessive deficit of the Member States in the euro area1, and in particular Article 10(3) thereof,

Whereas:

(1)

Regulation (EU) No 473/2013 sets up a closer monitoring for Member States whose currency is the euro in excessive deficit procedure by means of additional reporting requirements aiming at ensuring prevention and early correction of any deviations from the Council recommendations or decisions to give notice to correct the excessive deficit.

(2)

Such monitoring complements the existing reporting obligations set out in Article 3(4)(a) and Article 5(1)(a) of Council Regulation (EC) No 1467/97 of 7 July 1997 on speeding up and clarifying the implementation of the excessive deficit procedure2 which require that a Member State in excessive deficit procedure subject to a Council recommendation made in accordance with Article 126(7) of the Treaty or a notice made in accordance with Article 126(9) of the Treaty shall report to the Council and the Commission on action taken to correct the excessive deficit. This report shall include the targets for government expenditure and revenue and for the discretionary measures on both the expenditure and the revenue side consistent with the Council’s recommendation, as well as information on the measures taken and the nature of those envisaged to achieve the targets.

(3)

Regulation (EU) No 473/2013 complements this initial reporting requirement by requiring a more frequent reporting from Member States whose currency is the euro which are in excessive deficit. The latter will have to report to the Commission and to the Economic and Financial Committee (EFC) every six months if subject to a Council recommendation made in accordance with Article 126(7) and every three months if subject to a Council decision to give notice in accordance with Article 126(9) TFEU on the action taken to correct the excessive deficit. The reporting should contain, for the general government and its sub-sectors, the in-year budgetary execution, the budgetary impact of discretionary measures taken on both the expenditure and the revenue side, targets for the government expenditure and revenues and information on the measures adopted and the nature of those envisaged to achieve the targets. This more frequent reporting will help the Commission and the EFC to continuously monitor whether the Member State concerned is on track to correct its excessive deficit.

(4)

According to Article 10(3) of Regulation (EU) No 473/2013, the content of this additional reporting is to be specified by the Commission. This delegated act provides a clear framework for the information to be reported by Member States whose currency is the euro and which are subject to an excessive deficit procedure. The reporting established by this delegated Regulation will provide a structured and harmonised view of the budgetary situation of the Member States concerned. The report should contain annual and quarterly data in order to provide details on the on-going correction. Data should be reported on a cash and accrual basis (according to the European System of National Accounts ESA) in order to allow a better understanding of the dynamics of the budgetary situation. Given that an excessive deficit procedure can be open on the basis of non-compliance with either or both the deficit and the debt-to-GDP Treaty reference values, the evolution of the main components of the general government deficit and debt developments should be reported.

(5)

Actual data reported under this delegated act should be consistent with data reported to Eurostat in the context of the excessive deficit procedure,

HAS ADOPTED THIS REGULATION:

F1Article 1Subject matter

This Regulation lays down specifications concerning the content of the reports that Member States whose currency is the euro are required to submit pursuant to Article 10(3) of Regulation (EU) No 473/2013.

Article 2Structure and content of the reporting

1.

The reports referred to in Article 1 shall have the following structure:

Actual balances, debt developments, and updated budgetary plans for the period of correction for the general government and its sub-sectors;
Description and quantification of the fiscal strategy in nominal and structural terms (cyclical component of the balance, net of one-off and temporary measures) to correct the excessive deficit by the deadline set by the Council in the view of the latest Council recommendation or decision to give notice in accordance with Article 126(7) or Article 126(9) TFEU, including detailed information on budgetary measures planned or already taken to achieve these targets and their budgetary impact.

2.

The reports shall include tables as indicated in the Annex to this Regulation.

F2Article 2aStructure and content of the reporting of Member States under enhanced surveillance pursuant to Article 2(3) and (4) of Regulation (EU) No 472/2013 as a result of having drawn on the Pandemic Crisis Support of the European Stability Mechanism

1.

Where a Member State is subject to enhanced surveillance solely as a result of having drawn on the Pandemic Crisis Support of the European Stability Mechanism, the in-year reporting requirement pursuant to Article 10 of Regulation (EU) No 473/2013 shall pertain to the use of the Pandemic Crisis Support funds to cover direct and indirect healthcare, cure and prevention-related costs related to the COVID-19 pandemic.

2.

The reports shall include the table indicated in Annex II.

Article 3Entry into force

This Regulation shall enter into force on the third day following that of its publication in the Official Journal of the European Union.

This Regulation shall be binding in its entirety and directly applicable in the Member States in accordance with the Treaties.

F1ANNEX ITables to be included in the reports to be submitted in accordance with Article 10(3) of Regulation (EU) No 473/2013 on common provisions for monitoring and assessing draft budgetary plans and ensuring the correction of excessive deficit of the Member States in the euro area

NB: In tables below, Year t corresponds to the year of submission of the report. Reporting for the items indicated in bold is compulsory. The conceptual framework agreed in the context of Council Directive 2011/85/EU4 should be implemented.

Table 1aIn-year quarterly budgetary execution on cash basis6for the general government and its sub-sectors7

EUR millions	Year t5
EUR millions	Q1	Q2	Q3	Q4
Overall balance by sub-sector (6-7)
1. General government
2. Central government
3. State government
4. Local government
5. Social security funds
For each sub-sector (please indicate which)
6. Total revenue/inflows
Of which (indicative list)
Taxes, of which:
Direct Taxes
Indirect taxes, of which:
VAT
Social contributions
Sales
Other current revenue
Capital revenue
Inflows from operations in financial instruments
7. Total expenditure/outflows
Of which (indicative list)
Purchase of goods and services
Compensation of employees
Interest
Subsidies
Social benefits
Other current expenditure
Capital transfers payable
Capital investments
Outflows from operations in financial instruments

The reporting is mandatory up to the current quarter included. If the data for the current quarter is not available, please provide latest available monthly data, indicating which month it corresponds to. For the overall balance of the general government, please provide the information until the latest available quarter (i.e. q-1). The normal quality assurance and revision policy should apply.

Table 1bIn-year quarterly budgetary execution and prospects in accordance with ESA standards and seasonally non-adjusted9for the general government and its sub-sectors

EUR millions	ESA code	Year t8
The data of budgetary execution provided in Table 1a and 1b should be consistent; a reconciliation table showing the methodology of transition between the two tables should be communicated.
EUR millions	ESA code	Q1	Q2	Q3	Q4
Net lending (+)/net borrowing (–)
1. General government 9	S.13
2. Central government	S.1311
3. State government	S.1312
4. Local government	S.1313
5. Social security funds	S.1314
For the general government (voluntary for the sub-sectors)
6. Total revenue 9	TR
Of which
Taxes on production and imports	D.2
Current taxes on income, wealth, etc.	D.5
Capital taxes	D.91
Social contributions	D.61
Property income	D.4
Other10
7. Total expenditure 9	TE
Of which
Compensation of employees	D.1
Intermediate consumption	P.2
Social payments	D.62, D.63211
Interest expenditure	D.41
Subsidies	D.3
Gross fixed capital formation9	P.51
Capital transfers	D.9
Other12
8. Gross debt 13

The reporting shall span until the end of the current Year t; quarterly prospects are not binding and reported as estimates (possibly subject to revisions) for informational and monitoring purposes.

P.11 + P.12 + P.131 + D.39rec + D.7rec + D.9rec (other than D.91rec).

Under ESA95: D6311_D63121_D63131pay; in ESA2010 D632pay.

D.29pay + D.4pay (other than D.41pay) + D.5pay + D.7pay + P.52 + P.53 + K.2 + D.8.

As defined in Council Regulation (EC) No 479/2009 (OJ L 145, 10.6.2009, p. 1).

Table 1cAnnual budgetary targets in accordance with ESA standards for the general government and its sub-sectors

	ESA Code	Year t – 1	Year t	Year t + …14
Net lending(+)/net borrowing (–) by sub-sector (% GDP)
1. General government	S.13
2. Central government	S.1311
3. State government	S.1312
4. Local government	S.1313
5. Social security funds	S.1314
General government (S.13) (% GDP)
6. Total revenue	TR
7. Total expenditure	TE
8. Interest expenditure	D.41
9. Primary balance 15
10. One-off and other temporary measures 16
		rate of change	rate of change	rate of change
11. Real GDP growth
12. Potential GDP growth
contributions:
— labour
— capital
— total factor productivity
		% potential GDP	% potential GDP	% potential GDP
13. Output gap
14. Cyclical budgetary component
15. Cyclically-adjusted balance (1 – 14)
14. Cyclically-adjusted primary balance (13 + 6)
15. Structural balance (13 – 10)

Following the request from the Commission to activate the reporting requirements provided for by Article 10(3) of Regulation (EU) No 473/2013, the reporting starts from the year of the opening of the excessive deficit procedure in accordance with Article 126(6) TFEU, and spans until the excessive deficit is planned to be corrected, in accordance with the deadline set by the Council recommendation in accordance with Article 126(7) TFEU or decision to give notice in accordance with Article 126(9) TFEU.

The primary balance is calculated as (B.9, item 8) plus (D.41, item 9).

A plus sign means deficit-reducing measures.

Table 2Targets for the expenditure and revenues of the general government (S.13) in accordance with ESA standards

% GDP	ESA Code	Year t – 1	Year t	Year t + 1	Year t + …17
1.Total revenue target (= table 1c. 6)	TR
Of which
1.1. Taxes on production and imports	D.2
1.2. Current taxes on income, wealth, etc.	D.5
1.3. Capital taxes	D.91
1.4. Social contributions	D.61
1.5. Property income	D.4
1.6. Other 18
p.m.: Tax burden (D.2 + D.5 + D.61 + D.91-D.995)19
2.Total expenditure target (= table 1c.7)	TE20
Of which
2.1. Compensation of employees	D.1
2.2. Intermediate consumption	P.2
2.3. Social payments	D.62, D.6311, D.63121, D.6313123
of which: Unemployment benefits 21
2.4. Interest expenditure	D.41
2.5. Subsidies	D.3
2.6. Gross fixed capital formation	P.51
2.7. Capital transfers	D.9
2.8. Other 22

Following the request from the Commission to activate the reporting requirements provided for by Article 10(3) of Regulation (EU) No 473/2013, the reporting starts from the year of the opening of the excessive deficit procedure in accordance with Article 126(6) TFEU, and spans until the excessive deficit is planned to be corrected, in accordance with the deadline set by the Council Recommendation in accordance with Article 126(7) TFEU or decision to give notice in accordance with Article 126(9) TFEU.

P.11 + P.12 + P.131 + D.39rec + D.7rec + D.9rec (other than D.91rec).

Including those collected by the EU and including an adjustment for uncollected taxes and social contributions D.995), if appropriate.

TR - TE = B.9.

In ESA2010: D.62, D.632.

Includes cash benefits (D.621 and D.624) and in kind benefits (D.631) related to unemployment benefits.

D.29 + D.4 (other than D.41) + D.5 + D.7 + P.52 + P.53 + K.2 + D.8.

Table 3aBudgetary measures adopted and envisaged by the general government and its sub-sectors on both the expenditure and the revenue side to achieve the targets presented in Table 2

Expected budgetary impact of measures adopted and envisaged25
List of measures	Detailed description26	Target (Expenditure/Revenue)ESA Code	Accounting principle27	Adoption Status	Incremental budgetary impact (EUR million) on year
List of measures	Detailed description26	Target (Expenditure/Revenue)ESA Code	Accounting principle27	Adoption Status		t – 1	t	t + 1	t + 2	t +24



TOTAL

Only measures sufficiently detailed and credibly announced should be reported.

Including reporting on which sub-sector is taking the measure.

By default, the impact of the measures will be reported on accrual basis, but, if impossible and reporting is in cash, it should be indicated explicitly. The impact is to be recorded in incremental terms – as opposed to levels – compared to the previous year’s baseline projection. Simple permanent measures should be recorded as having an effect of +/– X in the year(s) they are introduced and zero otherwise (the overall impact on the level of revenues or expenditures must not cancel out). If the impact of a measure varies over time, only the incremental impact should be recorded in the table. By their nature, one-off measures should be always recorded as having an effect of +/–X in the year of the first budgetary impact and –/+ X in the following year, i.e. the overall impact on the level of revenues or expenditures in two consecutive years must be zero.

Year when the excessive deficit is planned to be corrected, in accordance with the deadline set by the Council recommendation in accordance with Article 126(7) TFEU or decisions to give notice in accordance with Article 126(9) TFEU.

Table 3bIn-year quarterly reporting on the budgetary impact of the measures presented in Table 3a

List of measures28	In-year reporting for measures having an effect on year t (choose one of the alternatives below)29
	Quarterly observed budgetary impact (EUR million)30				Cumulative observed budgetary impact since the start of the year (EUR million)
	Q1	Q2	Q3	Q4


TOTAL

Select the measures reported in Table 3a which have a budgetary impact in year t.

Filling one of the two alternatives is mandatory: quarterly reporting (estimates possibly subject to revisions) at least until the current quarter and/or sum of the observed budgetary impact until the current date.

Indicate for each quarter whether the data reported corresponds to observed data; the reporting is mandatory up to the current quarter included.

Table 4General government (S.13) debt developments and prospects

		Year t – 1	Year t	Year t + …31
	ESA Code	% GDP	% GDP	% GDP
1.Gross debt32 (= Table 1b.8 for the general government)
2. Change in gross debt ratio
Contributions to changes in gross debt
3.Primary balance (= Table 1c. 9)
4.Interest expenditure (= Table 1c.8)	D.41
5. Stock-flow adjustment
of which:
— Differences between cash and accruals33
— Net accumulation of financial assets34
of which:
— Privatisation proceeds
— Valuation effects and other35
p.m.: Implicit interest rate on debt36(%)
Other relevant variables
6. Liquid financial assets37
7. Net financial debt $(7 = 1 - 6)$
8. Debt amortization (existing bonds) since the end of the previous year
9. Percentage of debt denominated in foreign currency (%)
10. Average maturity (years)
11.Real GDP growth (%) (= Table 1c row 11)

As defined in Regulation (EC) No 479/2009.

The differences concerning interest expenditure, other expenditure and revenue could be distinguished when relevant or in case the debt-to-GDP ratio is above the reference value.

Liquid assets (currency), government securities, assets on third countries, government controlled enterprises and the difference between quoted and non-quoted assets could be distinguished when relevant or in case the debt-to-GDP ratio is above the reference value.

Changes due to exchange rate movements, and operation in secondary market could be distinguished when relevant or in case the debt-to-GDP ratio is above the reference value.

Proxied by interest expenditure divided by the debt level of the previous year.

Liquid assets are here defined as AF.1, AF.2, AF.3 (consolidated for general government, i.e. netting out financial positions between government entities), A.F511, AF.52 (only if quoted in stock exchange).

F2ANNEX II

Table to be transmitted quarterly Costs related to the COVID-19 pandemic

	Year 2020				Year 2021 38
In EUR million Time series of actual data ending at quarter of the respective report to be submitted	Q1	Q2	Q3	Q4	Q1	Q2	Q3	Q4
Healthcare, cure and prevention costs directly related to the COVID-19 pandemic
[Item]
[Further items as necessary]39
Part of overall public healthcare spending estimated to be directly or indirectly attributed to addressing the impact of COVID-19 on the healthcare system 40
[Item]
[Further items as necessary]39
Other indirect costs related to healthcare, cure and prevention due to the COVID-19 crisis
[Item]
[Further items as necessary]39

The last year of the availability period or of a possible disbursement of the Pandemic Crisis Support (whichever is earlier) is also the last year of the reporting, unless the Member State has not yet used all the funds drawn.

Items and sub-items, as necessary, accompanied with the relevant explanations to allow the Commission to perform a meaningful assessment.

This can include, inter alia, spending on hospitals; cure and rehabilitative care, ambulatory cure and rehabilitative care, diagnostics, pharmaceuticals, preventive care, health administrations, and health related long-term care.

F1Article 1Subject matter

Article 2Structure and content of the reporting

1.

2.

F2Article 2aStructure and content of the reporting of Member States under enhanced surveillance pursuant to Article 2(3) and (4) of Regulation (EU) No 472/2013 as a result of having drawn on the Pandemic Crisis Support of the European Stability Mechanism

1.

2.

Article 3Entry into force

F1ANNEX ITables to be included in the reports to be submitted in accordance with Article 10(3) of Regulation (EU) No 473/2013 on common provisions for monitoring and assessing draft budgetary plans and ensuring the correction of excessive deficit of the Member States in the euro area

1.

2.

3.

4.

5.

6.

7.

1.

2.

3.

4.

5.

6.

7.

8.

1.

2.

3.

4.

5.

6.

7.

8.

9.

10.

11.

12.

—

—

—

13.

14.

15.

14.

15.

1.Total revenue target

1.1.

1.2.

1.3.

1.4.

1.5.

1.6.

2.Total expenditure target

2.1.

2.2.

2.3.

2.4.

2.5.

2.6.

2.7.

2.8.

1.Gross debt32

2.

3.Primary balance

4.Interest expenditure

5.

—

—

—

—

6.

7.

8.

9.

10.

11.Real GDP growth (%)

F2ANNEX II