EU agrees to create new budget sanctions
Herman Van Rompuy - Photo EU Council
(LUXEMBOURG) - EU finance ministers agreed on Monday to design new sanctions that will allow partners to intervene before countries become too laden down by debt, EU president Herman Van Rompuy said.
In the first conclusions of a task force set up by all 27 national leaders to coordinate better economic governance across the world's biggest trading bloc, they also agreed to the principle that national budgets should be shown to European partners before they are fixed back home.
The move stems from concerns over Europe's debt crisis, which has forced eurozone governments and even EU partners, albeit to a much lesser extent, to cough up funds to bail out first Greece and now all struggling eurozone nations.
Ministers want to be able to enforce eurozone rules and commit governments across the European Union to remaining within a deficit ceiling of three percent of gross domestic product, and a debt cap of 60 percent of output.
The EU executive will now come forward with concrete proposals as to what those sanctions could involve, with ideas ranging from the suspension of voting rights through the freezing of Brussels' funding to ordering capitals to run up surpluses.
Van Rompuy said ministers spoke about non-financial sanctions, "but everybody is conscious that (these) would require treaty change," to which a host of members, led by Britain, are resolutely opposed.
He said they had instead decided to "concentrate on what can be done short-term and in the context of the current treaty which does not allow us to go further," although he stressed the idea was "not taboo".