Which Budgetary Rules for which EMU?

Twenty years after the inception of EMU, a revision of its rules and, beyond that, of its economic coordination framework, is on the agenda. This article reviews some recent proposals claiming to deliver rules or « standards » that would be less complex and more flexible and would better fit the specificities of the Member States than the current rules. Conversely, this article puts forward a reform that would be based on a few simple criteria. The new arrangement would rest on numerical variables that would be enforceable and not manipulable. Its implementation would be easily monitored by the European authorities, whose prerogatives would be strengthened. The structural balance objective, which could be adapted to the level of debt of the Member States, would provide the cornerstone of the arrangement. However, creating a new set of common rules in an increasingly heterogenous economic area seems highly hypothetical without a strengthening of the European governance framework. Consequently, the current discussions on the fiscal framework should not ignore a more fundamental project: an overall reform of the economic policies of EMU. Of course, this presupposes a political will to proceed toward a less intergovernmental and more federal model.