The Socialists and Democrats recognise the importance of reforming EU fiscal rules – long overdue as a result of the shortcomings of the current economic governance framework. This is not only an essential step for the euro zone and the Union as a whole but also a key signal to the financial markets.

Margarida Marques, S&D MEP and European Parliament’s co-rapporteur on the reform of EU fiscal rules, said:

“The S&Ds have made significant improvements. Most importantly, we secured a strong social imprint in the new rules, especially with a historic new tool to monitor social progress and risks. We safeguarded social and climate priorities that the right-wing parties sought to eliminate, leading to more sustainable and inclusive investments.

“Furthermore, we ensured the exemption of national co-financing of EU projects – around 1% of EU GDP – from the calculation of net expenditure, which will free up significant space for public investment at national level and open up new options for ambitious EU policymaking.

“We secured several other solutions that allow for more flexibility and national ownership, making the whole process more democratic.

“Clearly, we wanted more. We put forward many progressive proposals that we fought for against the attacks from the conservatives and the liberals. Nevertheless, the agreement is a step in the right direction and it creates opportunities for further improvements. There is no doubt that this deal is much better than no deal and going back to the old rules or having no rules at all.

“What is key now is to focus on the future, seize the opportunities generated by this deal and put all our efforts into securing a permanent European investment tool. This is vital to complement the fiscal rules and to ensure the resources needed to realise the socially-just green and digital transitions as well as to tackle other challenges. This is a key priority for the next legislative cycle.”