The key metrics for government budgets improved in the past year – both the government debt ratio and the deficit ratio are likely to have shrunk in the euro area overall – but the outturn is not yet available. Yet this budgetary improvement is not down to consolidation efforts.
The cyclically adjusted primary surpluses – which reflect the consolidation efforts – have remained steady or even declined of late. Favourable economic developments should not obscure the fact that there is still some way to go if we are to safeguard public finances.