The increased focus on debt, in both the preventive and corrective arms of the Pact, is definitely warranted, as the overall indebtedness of a country, including a government’s implicit liabilities resulting from pension systems and ageing populations, allows for a more comprehensive assessment of a country’s fiscal situation and prospects.
At the same time, the application of the debt criterion in “qualitative terms” will not be straightforward and, for this reason, it is essential that this be done in a systematic and credible manner. The increased emphasis on debt is expected to strengthen the Commission’s position to launch an excessive deficit procedure on the basis of its assessment of debt developments.