It is evident that that the economic downturn, discretionary fiscal measures to stimulate economic activity and government intervention to support the financial sector have had a substantial impact on public finances. The latest information and the Commission’s forecast today indicate a serious fiscal deterioration. 5 The current focus of fiscal policy on supporting the economy’s recovery is warranted.
At the same time, due attention should be paid that current actions do not undermine the integrity of the EU fiscal framework. It is essential to preserve the public’s trust in the sustainability of public finances. Therefore, fiscal policy needs to have a credible exit strategy from the current extraordinary circumstances.