Reference trajectory
Where the general government debt exceeds 60 % of GDP or the general government deficit exceeds 3 % of GDP, the Commission shall transmit to the Member State concerned and to the Economic and Financial Committee a reference trajectory for the net expenditure covering an adjustment period of four years and its possible extension by up to three years pursuant to Article 14.
Risk-based requirements for the reference trajectory
The reference trajectory shall be risk-based and differentiated for each Member State, ensuring that: (a) by the end of the adjustment period, assuming that there are no further budgetary measures, the projected general government debt ratio is put or remains on a plausibly downward path, or stays at prudent levels below 60 % of GDP over the medium-term; (b) the projected general government deficit is brought below 3 % of GDP over the adjustment period and is maintained below that reference value over the medium-term assuming that there are no further budgetary measures; (c) the fiscal adjustment effort over the period of the national medium-term fiscal-structural plan is linear as a rule and at least proportional to the total effort over the entire adjustment period; and (d) there is consistency with the corrective path referred to in Article 3(4) of Regulation (EC) No 1467/97, where applicable.
Debt sustainability safeguard
1. The reference trajectory shall ensure that the projected general government debt-to-GDP ratio decreases by a minimum annual average amount of: (a) 1 percentage point of GDP as long as the general government debt-to-GDP ratio exceeds 90 %; (b) 0,5 percentage points of GDP as long as the general government debt-to-GDP ratio remains between 60 % and 90 %. 2. The average decrease referred to in paragraph 1 of this Article shall be computed from the year before the start of the reference trajectory or the year in which the excessive deficit procedure is projected to be abrogated pursuant to Regulation (EC) No 1467/97, whichever occurs later, until the end of the adjustment period.
Deficit resilience safeguard
1. The reference trajectory shall ensure that fiscal adjustment continues, where needed, until the Member State concerned reaches a deficit level that provides a common resilience margin in structural terms of 1,5 % of GDP relative to the deficit reference value of 3 % of GDP. 2. The annual improvement in the structural primary balance to achieve the required margin shall be 0,4 percentage points of GDP, which shall be reduced to 0,25 percentage points of GDP in the case of an extension of the adjustment period referred to in Article 14.
Prior guidance by the Commission
1. By 15 January of the year in which the Member States have to submit their national medium-term fiscal-structural plans pursuant to Article 11 or, within three weeks of the request of the Member State to submit a revised plan pursuant to Article 15, the Commission shall transmit to the Member State concerned and to the Economic and Financial Committee: (a) the underlying medium-term public debt projection framework and results; (b) its macroeconomic forecast and assumptions; (c) the reference trajectory, if required under Article 5, or the technical information, if requested by a Member State under paragraph 3 of this Article, and the corresponding structural primary balance, including spreadsheet templates and other relevant information required to ensure its full replicability. 2. During the month before the deadline by which the Commission is to transmit to a Member State the prior guidance as referred to in paragraph 1 of this Article, the Member State may request a technical exchange with the Commission. Such technical exchange shall provide an opportunity to discuss the latest statistical information available and the economic and fiscal outlook of the Member State concerned. 3. For Member States that have a general government deficit not exceeding 3 % of GDP and general government debt not exceeding 60 % of GDP, the Commission shall provide, at the request of the Member State, technical information regarding the structural primary balance necessary to ensure that the headline deficit is maintained below 3 % of GDP assuming that there are no additional policy measures over the medium and long-term and indicating whether that implies fiscal adjustment needs. Such technical information shall also be consistent with the deficit resilience safeguard referred to in Article 8.
Plausibility assessment
1. To assess the plausibility of whether the projected general government debt ratio of a Member State is on a downward path or remains at a prudent level, the Commission shall apply a replicable, predictable and transparent methodology based on the following conditions: (a) general government debt ratio declines or stays at prudent levels, under the deterministic scenarios of the Commission’s medium-term government debt projection framework; (b) the risk of the general government debt ratio not decreasing in the five years following the adjustment period of the national medium-term fiscal-structural plan is sufficiently low, the assessment of which shall be based on the Commission’s Debt Sustainability Analysis. 2. The competent committee of the European Parliament may invite the Commission to present its methodology in the context of the economic dialogue referred to in Article 28. 3. The Commission shall make public its plausibility assessment and the spreadsheet templates containing the underlying data as well as other relevant information to ensure the replicability of results at the time of the submission of the national medium-term fiscal-structural plan pursuant to Article 11.
Provisions on this page are reproduced verbatim from official open data. See the attribution line.
Source: EUR-Lex (Publications Office of the EU), © European Union, reuse permitted under Commission Decision 2011/833/EU.