Changes from report parliamentary committee draft to plenary report

Added(b) The projected growth path of government revenue at unchanged policy.

Added(c) The projected path of the public debt ratio.

Added(ca) An assessment of national public investment gaps, including to achieve each of the common priorities of the Union referred to in Article 12, point (ba);

Added(d) Information on implicit liabilities related to ageing, and contingent liabilities with a potentially large impact on government budgets, including government guarantees, non-performing loans, and liabilities stemming from the operation of public corporations, including the extent thereof, potential expenses and obligations arising from court cases and, to the extent possible, science-based information on disaster and climate contingent liabilities.

Added(e) The main assumptions about expected economic developments and main economic variables which are relevant for ensuring consistency with a convergence of public debt towards prudent levels and maintaining the government deficit below the 3% of GDP reference value.

Added(f) In case the Member State makes use of assumptions referred to under point (e) that differ from the Commission’s assumptions over the adjustment period of the national medium-term fiscal-structural plan, and, if applicable, the reference trajectory proposed by the Member State deviates from the reference trajectory put forward by the Commission in accordance with Article 5, due explanations and justifications based on sound economic arguments of these differences.

Added(g) An analysis of how changes in the main economic assumptions would affect the budgetary and debt position of the Member State.

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Added(i) Reform and investment priorities to respond to the main challenges as identified in the country-specific recommendations, taking into account the state of play of implementation of those country-specific recommendations and the progress on the reduction of the investment gaps.

Added(j) ▌Reforms and public investment expenditure addressing each of the common priorities of the Union referred to in Article 12, point (ba).

Added(k) If applicable, information on a specific, time-bound and verifiable set of reform and investment commitments underpinning an extension of the adjustment period pursuant to Article 13, a timeline for its implementation, as well as sound economic arguments that this set of reform and investment commitments fulfil the criteria under Article 13 taking into account the assessment criteria in Annex VII.

Added(l) A quantification, as much as possible, of the expected impacts of reforms and investment referred to under point (k) on fiscal sustainability, sustainable and inclusive growth, competitiveness and quality employment, where applicable in line with commonly agreed methodologies.

Added(m) The medium-term budgetary and potential medium-term growth and resilience impact of those reform and investment commitments referred to under point (k) where possible.

Added(n) If applicable, reforms and investment to correct the identified macroeconomic imbalances under the Macroeconomic Imbalance Procedure, the warnings by the Commission or the recommendations by the Council pursuant to Article 121(4) TFEU.

Added(o) The planned overall level of reforms and nationally financed public investment covering the period of the national medium-term fiscal-structural plan.

Added(p) For Member States with low public debt challenges but large implicit liabilities due to population ageing, the national net expenditure trajectory and the reforms in the national medium-term fiscal-structural plans should take due consideration of long-term fiscal sustainability challenges of public finances.

Added(q) Information on the consultations of social partners, civil society organisations and other relevant stakeholders in view of the preparation of the plan, a summary of their contributions to the plan and how their input was reflected.

Added(qa) Challenges identified in the social convergence reports under the Social Convergence Framework and the implementation of the European Pillar of Social Rights.

AddedInformation to be provided by Member States in the Annual Progress Reports

AddedIn their annual progress report, the Member States shall submit the following information:

Added(a) A comparison between the planned net expenditure based on the net expenditure path set by the Council and the net expenditure based on outturn data.

Added(b) A comparison from the beginning of the national medium-term fiscal-structural plan between the projections of the main economic variables submitted in that plan and the outturn data for these variables, as well as the implications for compliance with the net expenditure path set by the Council and the implications on the projected path of the public debt ratio reported in that plan.

Added(c) An analysis of the implementation in the previous year of the discretionary revenue measures.

Added(d) Progress and the planned implementation for the following year of the commitments to reforms and investment given in the national medium-term fiscal-structural plan under the information to be provided in accordance with Annex II, points (i) and (j), as well as, if applicable, (k) and (n).

Added(e) Information for the following year on how the Member State intends to address the country-specific recommendations of the previous year, including, where applicable, the recommendation on the economic policy of the euro area.

Added(f) During the lifetime of the Recovery and Resilience Facility or any Union investment instrument that would serve a similar purpose, information on the progress of implementation of the Recovery and Resilience Plan, to comply with the bi-annual reporting requirements in the context of the European Semester set out in Article 27 of Regulation (EU) 2021/241.

Added(g) Information on the evolution of contingent liabilities reported in the national medium-term fiscal-structural plan and referred to in Annex II, point (d), as well as of the implicit liabilities related to ageing, where relevant, and information on the contingent liabilities and the implicit liabilities for the following year.

Added(h) The main assumptions about expected economic developments and main economic variables for the following years of the adjustment period, including the public debt ratio.

Added(i) The projections at unchanged policies for the following years of the adjustment period for government expenditure and revenue and their main components, including public investment expenditure.

Added(j) The planned government expenditure and revenue as a percentage of GDP and their main components for the following years of the adjustment period, taking into account the net expenditure path set by the Council.

Added(k) A description and quantification of the expenditure and revenue measures to be implemented to bridge the gap between the projections at unchanged policies for expenditure and revenue referred to in point (i) and the planned expenditure and revenue referred to in point (j).

Added(l) An analysis of the evolution of the macroeconomic imbalances identified under the Macroeconomic Imbalance Procedure and of the impact on them of the implementation of the relevant reforms and investment reported in the national medium-term fiscal-structural plan in accordance with Annex II, point (n), where applicable.

Added(m) Information on the implementation of a warning by the Commission or a recommendation by the Council pursuant to Article 121(4) TFEU.

Added(ma) An assessment of national public investment gaps, including to achieve each of the common priorities of the Union referred to in Article 12, point (ba);

Added(n) Information on labour market, skills and social policy developments, and on the implementation of policy measures taken that foster upward social convergence among Member States towards better working and living conditions, in line with the principles of the European Pillar of Social Rights and the Employment Guidelines under Article 148 TFEU. That includes the expected impact of measures, in relation to progress on the national targets on employment, skills and poverty reduction by 2030, and if applicable the expected impact of measures to address the challenges identified under the Social Convergence Framework.

Added(o) The assessment of the independent fiscal institutions referred to in Article 22.

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AddedAssessment framework for the set of reform and investment commitments underpinning an extension of the adjustment period

Added1. Scope

AddedThe purposes of this assessment framework is to serve:

Added– as a basis for the Commission to assess whether the set of reforms and investment commitments included in the national medium term fiscal structural plans underpinning an extension of their adjustment period meet the criteria set out in Article 13(2). This assessment framework represents thus the basis for the application of the assessment criteria as referred to in Article 13(2) with a view to ensuring an equitable and transparent process;

Added– as a basis to assess whether each of those reform and investment commitments fulfil the conditions set out in Article 13(3). This assessment framework represents thus also the basis for the application of the conditions as referred to in Article 13(3), for the same purpose.

Added2. Assessment criteria

AddedIn accordance with Article 13(2), the set of reforms and investment commitments included in the national medium term fiscal structural plans underpinning an extension of the adjustment period shall be commensurate with the degree of public debt challenges as established in the most recent update of the Debt Sustainability Monitor or the Debt Sustainability Analysis methodology and challenges to medium-term growth in the Member State. For Member States where public debt challenges are linked to significant challenges to medium-term growth, the set of reforms and investments is expected to also address bottlenecks to medium-term growth.

AddedThe set of reforms and investment commitments shall fulfil, taken altogether, the following criteria:

Added2.1 The set of reform and investment commitments are growth and resilience-enhancing;

Added– The set of reform and investment commitments are expected to entail, based on credible, well documented and prudent assumptions, a significant boost to the growth potential of the economy of the Member State concerned in a sustainable manner;

Added2.2 The set of reform and investment commitments support fiscal sustainability;

Added– The set of reform and investment commitments are expected to entail a significant structural improvement of public finances over the medium-term, by structurally reducing public expenditure or increasing public revenue, of the Member State concerned.

Added2.3 The set of reform and investment commitments address common priorities of the Union referred to in Article 12, point (ba);

Added– The set of reform and investment commitments contribute significantly to at least one of the common priorities of the Union referred to in Article 12, point (ba);

Added2.4 The set of reform and investment commitments, taken altogether, addresses relevant country-specific recommendations, including, where applicable, recommendations issued under the Macroeconomic Imbalance Procedure;

Added– The set of relevant reform and investment commitments underpinning the extension of the adjustment period, taken altogether is expected to address challenges identified in the relevant country-specific recommendations, including the recommendations issued under the Macroeconomic Imbalance Procedure where applicable, taking into account the scope and scale of the country-specific challenges and the commitments made under the Recovery and Resilience Plans, where relevant;

Added2.5 The set of reform and investment commitments ensure that the overall level of nationally financed public investment over the lifetime of the national medium-term fiscal-structural plan is higher than the medium-term level before to the period of that plan

Added– Whether the planned level of nationally financed public investment over the lifetime of the plan is higher than the medium-term level before to the period of the plan.

AddedIn addition, each of the reform and investment commitments made by Member States underpinning an extension of the adjustment period should be sufficiently detailed, adequately distributed throughout the period covered by the plan and at the latest by the end of the adjustment period time-bound, and verifiable.

Added– the description of the reform and investment commitments is clear and sets out the detailed elements of each reform and investment, that allows the Commission to assess the criteria in points 2.1-2.5, including regarding their implementation, and monitoring;

Added– the reforms will be implemented within the plan period;