Fiscal watchdog rejects EU plan to ease energy investment rules

The board’s annual assessment arrives as euro area public finances face significant pressure, with the aggregate deficit projected to reach 3.5 percent of GDP. Debt levels remain stubbornly high, exceeding 90 percent of GDP, while many nations have yet to roll back the expansive fiscal measures introduced during the pandemic. Rising interest costs further complicate the outlook for high-debt economies like Italy and France.

Policy experts argue that the proposed flexibility mirrors the mistakes of the 2022–2023 energy crisis, when broad-based subsidies persisted long after prices stabilized. Hasekamp insists that any new support must be strictly temporary, targeted, and fully offset by spending cuts or tax increases elsewhere. Instead of broad stimulus, the board recommends that governments prioritize public investment and clear end-dates for all emergency measures.