05.12.2011

Deputy Minister of Finance Boryana Pencheva took part in the ECOFIN meeting held in Brussels on 30 November. The Council officially approved the EU budget for year 2012. The total amount of payments under the next year's budget is increasing by 1.86% compared to 2011, and those are limited to EUR 129,088 billion or 0.98% of GNI of the EU.

The Ministers of Finance exchanged views on the two new draft Regulations on the strengthening of economic and budgetary surveillance of Member States in the Euro area, proposed by the European Commission. In the first draft Regulation the European Commission proposes to enhance coordination and surveillance of the draft budgets of all Euro area countries and particularly of those undergoing an excessive deficit procedure. According to it, the Euro area countries are to submit their draft budgets to the Commission by mid-October each year and the Commission will assess them and, if needed, will issue an opinion on them. It introduces a requirement all Member States from the Euro area to have independent fiscal councils and to base their budgets on independent forecasts. In its second draft Regulation the European Commission proposes a legal basis for enhanced surveillance of the Euro area countries that have difficulties with regard to their financial situation and receive financial assistance or are in a procedure for obtaining such assistance.

The Commission also presented a Green Paper on the so-called Stability Bonds, which directs the debate on the common issuance of debt among the Member States of the Euro area. The Green Paper proposes three different options for debt issuance in the Euro area - full substitution of national government securities with common Euro Bonds, with joint and several guarantees by Euro area countries; partial substitution of national issuance with Euro Bonds issuance with joint and several guarantees; and partial substitution of national issuance with issuance of Euro Bonds guaranteed by the governments up to a certain ceiling. However, the proposals face sharp resistance by some Euro area countries.

EU Finance Ministers also exchanged views on the Annual Growth Review for 2012. The review calls EU Member States to focus next year on fiscal consolidation efforts, combined with growth-oriented measures, on restoring the funding to the real economy, on measures to stimulate growth and competitiveness, on combating unemployment and social implications of the crisis as well as on public administration modernization.