At present the euro area fiscal deficit stands at just under 3% of GDP. Ten years ago, at a similar point in the economic cycle, it was around 6%. The Pact may not be working as well as we would like, but this does not mean that it has been a failure. By being there, it has had some impact.
We should give the rules and procedures of the Maastricht Treaty and the Pact due credit for this. We should also be reassured by the fact that the euro area has a strong monetary constitution. It has an independent central bank with a clear objective to maintain price stability. Monetary financing of budget deficits and the bailing-out of insolvent governments are prohibited.