Changes from report parliamentary committee draft to plenary report

Added(ii) the European Pillar of Social Rights including the related targets on employment, skills and poverty reduction by 2030;

Added(iii) the Digital Decade Policy Programme 2030, and reflected at national level through the National Digital Decade Strategic Roadmaps;

Added(iv) a Strategic Compass for Security and Defence - For a European Union that protects its citizens, values and interests and contributes to international peace and security.

Added(bb) explain how it will ensure consistency with the updated National Energy and Climate Plans, the European Climate Law and the National Digital Decade Roadmaps;

Added(bc) assess the national public investment gaps, including to achieve each of the common priorities of the Union referred to in point (ba);

Added(c) if applicable, explain how it will ensure the delivery of a relevant set of reforms and investments referred to in Article 13, underpinning an extension of the Member State’s adjustment period by 3 years at most;

Added(d) explain how it will ensure consistency and, where appropriate, complementarity, with the Recovery and Resilience Plan of the Member State concerned during the period of availability of the Recovery and Resilience Facility in accordance with Regulation (EU) 2021/241 and with any Union investment instruments that address the Union’s common priorities or serve the same purpose as the Recovery and Resilience Facility;

Added(da) explain how it will ensure consistency and, where appropriate, complementarity with Union funds, in particular with the cohesion policy funds benefiting the Member State concerned.

AddedRequirements for an extension of the adjustment period

Added1. Where a Member State commits to a relevant set of reforms and investments in accordance with the criteria set out in paragraph 2, the adjustment period may be extended by 3 years at most.

Added2. The set of reform and investment commitments underpinning an extension of the adjustment period, shall be commensurate with the degree of public debt challenges and challenges to medium-term growth in the Member State concerned.

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

Added(i) be growth and resilience enhancing;

Added(ii) support fiscal sustainability;

Added(iii) address the common priorities of the Union referred to in Article 12, points (ba) and (bb);

Added(iv) address relevant country-specific recommendations addressed to the Member State concerned, including, where applicable, recommendations issued under the Macroeconomic Imbalances Procedure.

Added▌

Added3. Each of the reform and investment commitments underpinning an extension of the adjustment period shall 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.

Added4. The set of reforms and investments for an extension of the adjustment period shall be consistent with commitments included in the approved Recovery and Resilience Plan of the Member State concerned during the lifetime of the Recovery and Resilience Facility, in accordance with Regulation (EU) 2021/241, and the Partnership Agreement in Multiannual Financial Framework.

Added5. The assessment of whether the set of reforms and investment commitments fulfil the criteria set out in paragraph 2 and of whether each of the reform and investment commitment fulfil the conditions set out in paragraph 3 shall be carried out in accordance with the assessment framework set out in Annex VII.

AddedRevised national medium-term fiscal-structural plan

Added1. By no later than 12 months before the end of the current national medium-term fiscal structural plan, a Member State may request to submit a revised national medium-term fiscal-structural plan to the Commission before the end of its adjustment period if there are objective circumstances preventing the implementation of the current national medium-term fiscal-structural plan ▌. The levels of ambition of the reform and of investments in the revised plan shall not be lower than the levels of the original plan.

Added1a. A new government in a Member State may submit a new or revised national medium-term fiscal-structural plan to the Commission, taking into account the level of ambition of the previous plan.

Added1b. A revised national medium term fiscal structural plan shall be accompanied by an opinion of the national independent fiscal institutions of the Member State concerned assessing the circumstances preventing the implementation of the original plan. However, failure by the independent fiscal institution to deliver such an opinion within a reasonable timeframe shall not prevent the submission of the Member State’s revised national medium-term fiscal-structural plan.

Added2. Prior to the submission of the revised national medium-term fiscal-structural plan, a new reference trajectory shall be put forward, in accordance with Article 5 .

Added3. Taking into account the past adjustment of the Member State concerned or the lack thereof, the new reference trajectory shall not allow backloading of the fiscal adjustment effort and shall not lead to a lower fiscal adjustment effort.

Added4. Where a revised national medium-term fiscal-structural plan is submitted, Articles 12 and 15 to 19 shall apply.

Added5. The Commission shall in particular assess, if applicable, whether any extension of the adjustment period is to continue to apply under the revised national medium-term fiscal-structural plan, taking into account the implementation of the set of reform and investment commitments underpinning the extension under the original plan and the changes in terms of public debt challenges under the revised national medium-term fiscal-structural plan.

AddedAssessment of national medium-term fiscal-structural plans by the Commission

Added1. The Commission shall assess each national medium-term fiscal-structural plan within 2 months of its submission. The Member State concerned and the Commission may, if necessary, agree to extend the period of assessment by a reasonable period, not exceeding 2 months .

Added2. When assessing the national medium-term fiscal-structural plan the Commission shall examine for all Member States:

Added(a) whether the national medium-term fiscal-structural plan ensures that public debt is put or kept on a plausibly downward path leading to sustainable debt reduction or stays at prudent levels;

Added(b) whether the government deficit is maintained below the 3% of GDP reference value throughout the duration of the plan or whether the government deficit returns swiftly below the 3% of GDP reference value at the latest by the end of the adjustment period when the deficit is above this reference value at the time of submission of the national medium-term fiscal-structural plan;

Added(c) whether the government deficit is maintained below the 3% of GDP reference value in the absence of further budgetary measures over a period of 10 years;

Added(d) whether the fiscal adjustment effort over the period of the national medium-term fiscal-structural plan is at least proportional to the total effort over the entire adjustment period;

Added▌

Added(f) whether the public debt ratio stabilises over the adjustment period and is reduced every year over the projection period on average by at least one percentage point of debt to GDP for the Member States with a debt-to-GDP ratio exceeding 90% and at least half a percentage point for the Member States with a debt-to-GDP ratio of 60% to 90%.

Added3. The Commission shall examine for all Member States whether the national medium-term fiscal-structural plan complies with the requirements set out in Article 12. In addition the Commission shall examine for the Member State concerned

Added▌whether the set of reform and investment commitments underpinning an extension of the adjustment period fulfil the conditions set out in Article 13.

Added▌

AddedEndorsement of the national medium-term fiscal-structural plan by the Council

AddedThe Council, on a recommendation from the Commission, shall adopt a recommendation setting the net expenditure path of the Member State concerned and, if applicable, endorsing the set of reform and investment commitments underpinning an extension of the adjustment period included in its national medium-term fiscal-structural plan within four weeks of the adoption of the Commission recommendation as a rule. The Commission recommendation shall be accompanied by an opinion of the European Fiscal Board (EFB) on the Union dimension and the original opinion of the national independent fiscal institution of the Member State concerned as referred to Article 9(3). However, failure by the EFB and the national independent fiscal institution to provide their respective opinions shall not prevent the Commission from putting forward a recommendation.

AddedWhere the national medium-term fiscal-structural plan serves as the corrective action plan required for the correction of excessive macroeconomic imbalances, as provided for in Article 30, the Council shall also endorse in that recommendation the reforms and investment necessary to correct the imbalances.

AddedCouncil Recommendation for a revised national medium-term fiscal-structural plan

AddedWhere it considers that the plan does not comply with the requirements set out in Article 15 (2) and (3) point (a), the Council shall, on a recommendation from the Commission, recommend that the Member State concerned submits a revised national medium-term fiscal-structural plan.

AddedCouncil Recommendation in case of failure by the Member State

AddedThe Council shall, on a recommendation from the Commission, recommend to the Member State concerned that the reference trajectory issued by the Commission in accordance with Article 5, second subparagraph, be the net expenditure path of the Member State where:

Added(a) the Member State concerned fails to submit a revised national medium-term fiscal-structural plan within two months of the recommendation by the Council;

Added(b) the Council considers that the revised national medium-term fiscal-structural plan does not comply with the requirements set out in Article 15(2) and (3), duly justifying its position;

Added(c) the Member State fails to submit an initial national medium term fiscal-structural plan or a new national medium-term fiscal-structural plan at the end of the period covered by the previous national medium-term fiscal-structural plan.

AddedFailure by a Member State to satisfactorily comply with its commitments underpinning an extension of its adjustment period

AddedWhere a Member State has been granted an extension of its adjustment period but fails to satisfactorily comply with its set of reform and investment commitments underpinning the extension referred to in Article 13(1), the Council shall, as a rule, follow the recommendation from the Commission, and recommend a revised net expenditure path with a shorter adjustment period or, where Council does not do so, explain its position publicly.

AddedMedium-term fiscal-structural plans scoreboard

Added1. The Commission shall establish a medium-term fiscal-structural plans scoreboard (the ‘Scoreboard’) to display the progress of the implementation of the national medium-term fiscal-structural plans of the Member States, including in particular the reforms, investments and Union priorities as well as the stage of the life-cycle of the plan and the status of the actual net expenditure path. The Scoreboard shall also display information related to the national public investment gaps, including to achieve each of the common priorities of the Union referred to in Article 12, point (ba).

Added2. The Commission shall be empowered to adopt a delegated act in accordance with Article 33 to supplement this Regulation by defining the detailed elements of the Scoreboard with a view to displaying the progress of the implementation of the medium-term fiscal-structural plans as referred to in paragraph 1.

Added3. The Scoreboard shall be operational by [1 June] 2024 and shall be updated by the Commission twice a year. The Scoreboard shall be made publicly available on a website or internet portal.

AddedIMPLEMENTATION OF THE NATIONAL MEDIUM-TERM FISCAL-STRUCTURAL PLANS

AddedProgress report

Added1. Each Member State shall submit to the Commission an annual progress report on the implementation of its national medium-term fiscal-structural plan, by 30 April each year at the latest.

Added2. The annual progress report referred to in paragraph 1 shall contain in particular information about the progress in the implementation of the net expenditure path, the implementation of broader reform and investment commitments in the European Semester context and, if applicable, in the implementation of the set of reform and investment commitments underpinning an extension of the adjustment period.