In the last plenary session of the current legislature, in Strasbourg (France), the Parliament approved the revision of the EU's economic governance rules - which it had already provisionally agreed with the Council (Member States) last February - by clearly approving three pieces of legislation.

With today's approval by MEPs, during the last plenary session of the current legislature (2019-2024), before the European elections scheduled for June, the Council (Member States) must confirm the adoption of the new legislative package on economic governance, which should happen next Monday, so that the new rules come into force in exactly one week, on 30 April.

The EU's budgetary rules were suspended following the covid-19 pandemic, to allow Member States to face the crisis, and there was then a consensus on the need to review and update the legislation on economic governance before the Stability and Growth Pact, originally created in the late 1990s and already considered 'outdated', is resumed.

The European Commission presented a proposal in April last year, composed of three legislative acts, and today the MEPs gave their final approval, empowering the preventive 'arm' of the Pact, giving an opinion on the 'corrective' and approving the directive itself.

The three texts were approved by a clear majority, as they had the support of the main benches in Parliament, with between 359 and 368 votes in favour, between 161 and 166 votes against, and between 61 and 69 abstentions.

A European source explained to Lusa that, after today's parliamentary approval, it will be up to the permanent representatives of the Member States to the EU to adopt these three pieces of legislation next Friday.

The package will be confirmed by the Member States in the Council at a meeting to be held next Monday, 29 April, to be published in the Official Journal of the EU on the same day and enter into force one day later, therefore, on 30 April, the same source added.

Since the EU co-legislators - Parliament and Council - are finalising this approval of these new Community rules for deficit and public debt, the Member States (including Portugal) only had to send a simplified version of the Stability Programme to Brussels.

If, as expected, the new European budgetary rules come into force in the meantime, countries will have more time, until September, to submit a national plan to the European Commission.

These will be the new national structural budgetary plans (they will no longer be called national reform and stability programmes) and will include measures to correct macroeconomic imbalances and guidelines on reforms and priority investments for four or seven years.

Today's approval by MEPs was expected after the European Parliament and EU Member States reached a preliminary agreement on 10 February on the reform of the bloc's budgetary rules, aiming to ensure the recovery of public finances and simultaneously preserve investment.

At stake is the planned resumption of these budgetary rules after the suspension due to the covid-19 pandemic and the war in Ukraine, with a new formulation, despite the usual ceilings of 60% of Gross Domestic Product (GDP) for public debt and 3% of GDP for the deficit.

Debt reduction of at least one percentage point per year is planned for countries with a debt ratio above 90% of GDP (as is the case of Portugal) and half a percentage point for those between this ceiling and the 60% of GDP level.

It will be up to the Member States to prepare their national plans, which the European Commission will evaluate, defining a period of at least four years for the debt to be placed on a downward trajectory, with this period being able to be seven years in the face of reforms and investments (such as those included in the Recovery and Resilience Plans).

Even so, an annual public spending ceiling will be introduced for maximum deviation.

Defaulting countries may incur excessive deficit procedures and fines.

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