Updated | Government ‘confident budgetary measures to eliminate need for further action’

Reuters say the European Commission set to pick France, Italy and Belgium for a second review of compliance in March

Finance minister Edward Scicluna holding up the Budget case. Photo: Ray Attard
Finance minister Edward Scicluna holding up the Budget case. Photo: Ray Attard

Malta is one of seven EU member states “at risk of busting EU budget limits”, according to international news media Reuters.

Draft documents seen by Reuters show Malta is in this group together with Spain, Portugal and Austria. In the case of France, Italy and Belgium, the Commission is set to request a second review of compliance in March.

In a reaction, the Finance Ministry said that Malta, according to the Reuters report,  was not being reported as one of the countries which are likely to be submitted to a second review of compliance.

“This is unlike other Member States, which will reportedly be subjected to a second review of compliance in the coming March, with the risk of facing a disciplinary program,” the ministry said.

“The Government is confident, that following the measures announced last week in the Budget for 2015, the risks highlighted by the Commission are being duly addressed, and is confident that there will be no need for further action.”

If Rome, Paris and Brussels are found to have breached EU rule, France could face a multi-billion euro fine while Italy and Belgium would be put on a disciplinary programme.

The Commission will publish the assessments of all of the draft budgets of the 18 euro zone countries, except Greece and Cyprus, which remain under bailout programs.

The assessments are a new power the EU executive obtained last year in the wake of the sovereign debt crisis to make sure governments did not ignore EU rules that set limits on the size of public debt and deficit.

According to Malta’s 2015 budget document, after bringing the deficit down from 3.7% in 2012 to 2.7% of GDP in 2013, the government is aiming to reach a deficit target of 2.1% of GDP for this year and further reduce the deficit to 1.7% of GDP in 2015.

The government expects overall growth in 2014 to reach 3% in real terms while private consumption is expected to increase by 2.1% in real terms. Government expenditure is projected to rise by 6% in 2014, reflecting increases in compensation of employees and intermediate consumption.

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