What the EU does Economic policy is considered under EU law as 'a matter of common concern'. The EU has established an economic governance framework to monitor, prevent, and correct problematic economic trends in the EU that could negatively affect national economies, the euro area, or the EU’s economy as a whole. Within this framework, the EU issues guidance and coordination of EU countries’ fiscal policies. Governments typically use fiscal policy – or spending and tax policies – to promote strong, competitive and sustainable macroeconomic conditions and growth and reduce poverty.The EU’s Stability and Growth Pact underpins EU fiscal guidance. The Pact provides a set of rules that ensure that countries in the EU pursue sound public finances and coordinate their fiscal policies.The preventive arm of the Pact sets parameters for EU countries’ fiscal planning and policies during normal economic times.The corrective arm ensures EU countries adopt appropriate policy responses to correct excessive deficits and/or debts by implementing recommendations stemming from the Excessive Deficit Procedure. As a cornerstone of the reformed economic governance, in force since April 2024, EU countries submit their national medium-term fiscal-structural plans to the EU for scrutiny. They set out the country’s fiscal path as well as priority public investments and reforms for a four- or five-year period. These policies aim to ensure sustained and gradual debt reduction and sustainable and inclusive growth as well identify broader reforms and investments, including to address the common priorities of the EU. EU countries also develop their own national fiscal frameworks, which set down fiscal rules, regulations and procedures that influence how their budgetary policy is planned, approved, carried out, monitored and evaluated. Areas of actionStability and Growth PactFind out more about the Stability and Growth Pact, a set of rules designed to ensure that countries in the EU pursue sound public finances and coordinate their fiscal policies.National medium-term fiscal-structural plansLearn more about national medium-term fiscal-structural plans that bring together the fiscal policy, structural reforms and investments of an EU country.National fiscal frameworks in the EU Member StatesRead more about national fiscal frameworks, an important factor to increasing national ownership, stabilising expectations, allowing priority budgeting, and containing any deficit bias in fiscal policy making. Key achievements establishing a set of rules under the Stability and Growth Pact that ensure that countries in the EU pursue sound public finances and coordinate their fiscal policies.putting in place the Excessive Deficit Procedure that aims to help EU countries correct excessive deficits and/or debt in timeIntroducing ground-breaking EU legal requirements such as the Budgetary Frameworks Directive to help reinforce national fiscal frameworks, and the regulation on Draft Budgetary Plans (Two-Pack) to promote the coordination of fiscal policies in the euro area In focus European Fiscal BoardThe European Fiscal Board is an independent advisory body of the European Commission tasked with providing a timely evaluation of the implementation of the EU’s fiscal governance framework.Its other main responsibilities include:advise on the prospective fiscal stance appropriate for the euro area, as well as on the appropriate national fiscal stances that are consistent with it within the rules of the Stability and Growth Pactupon request of the Commission or the European Council, provide advice on the implementation of the Stability and Growth Pactcooperate closely with independent fiscal institutionsmake suggestions for the future evolution of the fiscal frameworkRead more Latest 26 March 2025Commission unveils the White Paper for European Defence and the ReArm Europe Plan/Readiness 203026 March 2025Economic Sentiment and Employment Expectations picked up in the EU and the euro areaMore news Events 20 January 2025Brussels Economic Forum 2025See more events Related informationDirectorate‑General for Economic and Financial AffairsLawTendersFunding
Economic policy is considered under EU law as 'a matter of common concern'. The EU has established an economic governance framework to monitor, prevent, and correct problematic economic trends in the EU that could negatively affect national economies, the euro area, or the EU’s economy as a whole. Within this framework, the EU issues guidance and coordination of EU countries’ fiscal policies. Governments typically use fiscal policy – or spending and tax policies – to promote strong, competitive and sustainable macroeconomic conditions and growth and reduce poverty.The EU’s Stability and Growth Pact underpins EU fiscal guidance. The Pact provides a set of rules that ensure that countries in the EU pursue sound public finances and coordinate their fiscal policies.The preventive arm of the Pact sets parameters for EU countries’ fiscal planning and policies during normal economic times.The corrective arm ensures EU countries adopt appropriate policy responses to correct excessive deficits and/or debts by implementing recommendations stemming from the Excessive Deficit Procedure.
Stability and Growth PactFind out more about the Stability and Growth Pact, a set of rules designed to ensure that countries in the EU pursue sound public finances and coordinate their fiscal policies.
National medium-term fiscal-structural plansLearn more about national medium-term fiscal-structural plans that bring together the fiscal policy, structural reforms and investments of an EU country.
National fiscal frameworks in the EU Member StatesRead more about national fiscal frameworks, an important factor to increasing national ownership, stabilising expectations, allowing priority budgeting, and containing any deficit bias in fiscal policy making.
European Fiscal BoardThe European Fiscal Board is an independent advisory body of the European Commission tasked with providing a timely evaluation of the implementation of the EU’s fiscal governance framework.Its other main responsibilities include:advise on the prospective fiscal stance appropriate for the euro area, as well as on the appropriate national fiscal stances that are consistent with it within the rules of the Stability and Growth Pactupon request of the Commission or the European Council, provide advice on the implementation of the Stability and Growth Pactcooperate closely with independent fiscal institutionsmake suggestions for the future evolution of the fiscal frameworkRead more
26 March 2025Commission unveils the White Paper for European Defence and the ReArm Europe Plan/Readiness 2030
