The institutional set-up therefore needs to be strengthened. In October last year the European Commission published a decision setting up a European Fiscal Board (EFB).13 In line with the recommendations of the Five Presidents’ Report, the EFB should provide an independent assessment of the Commission and the Council’s application of the Stability and Growth Pact.
While the European Commission should continue to enforce these rules, it should provide a justification where it deviates from the views of the EFB. This will help to increase the transparency and consistency of fiscal surveillance at the European level. Beyond fiscal surveillance, the EFB can also play an important role in fiscal policy coordination in the euro area.