Changes from report parliamentary committee draft to plenary report

RemovedF. whereas the TFEU establishes reference values of up to 3 % for government deficit and 60 % for the debt-to-GDP ratio;

AddedF. whereas for the EU as a whole, the Commission forecasts growth of 1.4 % to 1.5 % between 2025 and 2027, while in the euro area the dynamics are expected to be lower (1.2 % to 1.4 %); whereas potential growth in the EU is expected to decline from approximately 1.5 % in 2024 to 1.3 % in 2027 (in the euro area from 1.4 % to 1.2 %), mainly due to unfavourable demographic trends;

AddedG. whereas the EU has daunting investment needs, including additional annual investments of EUR 800 billion that the Draghi report deems necessary to boost Europe’s competitiveness and productivity, including EUR 450 billion for the energy transition alone – of which EUR 260 billion should come from the public sector according to Institut Rousseau; whereas a further EUR 800 billion in additional investments is envisaged for defence spending under the ReArm Europe Plan/Readiness 2030; whereas these investment targets lack corresponding new own resources, leaving the Union without the fiscal capacity needed to meet its stated objectives; whereas these needs cannot be met by public financing alone;

AddedH. whereas the EU is facing major challenges, ranging from persistent threats at its eastern borders linked to Russia’s war of aggression against Ukraine to geopolitical instability and trade uncertainty, while long-term challenges such as the green and digital transitions remain;

AddedI. whereas the TFEU establishes reference values of up to 3 % for government deficit and 60 % for the debt-to-GDP ratio; whereas the EU’s headline deficit and government debt-to-GDP ratio remain above the reference values; whereas both the headline deficit and government debt-to-GDP ratio vary across the EU, with significantly divergent situations across Member States;

Removed6. Welcomes the fact that inflation has been brought down to the European Central Bank target level after reaching its peak level of 10.6 % in October 2022; notes, however, that inflation remains at different levels across the Member States, with higher levels in Member States with energy-intensive industries;

Added6. Notes that the general government gross debt-to-GDP ratio in the EU is expected to reach 82.8 % in 2025 and is projected to increase to 83.8 % in 2026 and 84.5 % in 2027, above the 60 % reference value for individual Member States enshrined in the Treaties; notes that the general government debt in the euro area is projected to increase to 89.8 % in 2026 and to 90.4 % in 2027; notes that debt levels vary significantly among Member States;

Removed7. Is concerned by the macroeconomic stability risks posed by rising housing prices across the Member States, in particular potential restrictions on labour mobility and weakening of the growth in productivity;

Added7. Calls on the Member States to pursue prudent fiscal policies with a view to safeguarding the sustainability of public debt;

Removed8. Notes that on average the employment rate in the EU has reached a record-high level; welcomes the integration of the social convergence framework into the joint employment report of the European Semester;

Added8. Recalls that extreme weather events have a material impact on public finance; is aware that the impact and frequency of extreme weather events will only increase in the coming years;

RemovedRevised EU economic governance framework

Added9. Welcomes the fact that inflation in the euro area has been brought down to the European Central Bank target level after reaching its peak of 10.6 % in October 2022; notes, however, that inflation remains at different levels across the Member States, with some having higher levels, including those with energy-intensive industries; notes that both core inflation and inflation expectations still remain above target level; underlines the continued impact of food and energy inflation on European households; notes that inflation affects income groups unevenly, with low-income households being hit the hardest;

Removed9. Recalls that the purpose of the reform of the economic governance framework is to improve its ability to accommodate the heterogeneity of fiscal positions, public debt and economic challenges, and to help address the medium- and long-term challenges that the EU faces;

Added10. Expresses concern that insufficient private and public investment is likely to hinder sustainable growth and competitiveness in Europe and prevent the EU from meeting the common priorities set out in the EU strategic agenda 2024-2029; stresses that the Member States must step up efforts to remove barriers and mobilise greater private investment in line with the Commission’s savings and investments union strategy; recognises the Commission’s political objective of simplifying the regulatory framework and significantly reducing administrative burdens to foster private investment; highlights that investments in areas such as research and development, infrastructure and innovation are urgently needed to increase the EU’s potential growth; insists on the crucial role of the next multiannual financial framework not only in providing public investment, but also in helping mobilise private investment and underlines, in this context, that financial instruments and budgetary guarantees are powerful and effective tools for achieving critical EU policy goals as well as ready-to-use EU-wide financial instruments;

Removed10. Takes note of the targeted amendments to the EU’s economic governance framework published by the Commission on 2 October 2025;

Added11. Notes that the Commission’s European macroeconomic report acknowledges that housing affordability is a macroeconomic and social issue, in particular by imposing potential restrictions on labour mobility and weakening productivity growth over the long-term;

Added12. Highlights that a consistent and comprehensive industrial policy is vital for supporting the EU’s technological transformation and secure, resilient supply chains, while preserving competitive and undistorted markets;

Added13. Notes that, on average, the employment rate in the EU has reached a record-high level, reflecting a dynamic labour market in most Member States; highlights the integration of the social convergence framework into the European Semester; highlights that the model of vocational education and training has proven successful in the Member States that have opted for it; regrets that large differences exist among Member States in terms of unemployment rates, particularly with regard to young people;

Added14. Reiterates the importance of safeguarding a level playing field in the single market and calls on the Member States to take action to deepen the single market by eliminating internal barriers;

AddedApplication of the revised EU economic governance framework

Added15. Recalls that the purpose of the reform of the economic governance framework is to make it simpler, more transparent and more effective with greater national ownership and better enforcement, and to improve its ability to accommodate the heterogeneity of fiscal positions, public debt and economic challenges, and to help address the medium- and long-term challenges that the EU and its Member States are facing, including by promoting countercyclical fiscal policies;

Added16. Highlights that, under the reformed economic governance framework, the growth in net expenditure is the single operational indicator to monitor Member States’ compliance with the respective Council recommendations; highlights that many Member States will still face insufficient fiscal capacity to meet substantial investment needs; notes that the national escape clause (NEC) has already been activated for defence expenditure only one year after the entry into force of the revised rules as a short-term response to extraordinary events beyond a country’s control; underlines that the NEC is intended for temporary, country-specific emergencies and is not suited for addressing long-term structural needs;

Added17. Stresses that the Commission has expanded its discretionary powers under the reformed economic governance framework, notably through the process underpinning the medium-term fiscal-structural plans; notes the European Fiscal Board’s finding that the Commission used some discretion when delaying or deciding not to open excessive deficit procedures; stresses that an even application of the EU’s fiscal rules is paramount in order to maintain the credibility of the economic governance framework, ensure equal treatment of Member States and uphold a coherent and genuinely European approach;

Added18. Takes note of the targeted amendments to the EU’s economic governance framework published by the Commission on 2 October 2025, aimed at establishing consistency following the most recent update to the economic governance framework;

Added19. Notes, with concern, the European Fiscal Board’s findings that roughly half of independent fiscal institutions did not formally participate in the preparation of the medium-term fiscal-structural plans; is of the opinion that greater participation of independent fiscal institutions would increase transparency and external oversight at a key moment of transition;