EU member states could be forced to collectively cut their budgets by more than 100 billion Euro next year under the Council’s plans to reintroduce austerity measures.
France (26bn), Italy (25bn), Spain (14bn), Germany (11bn), Belgium (8bn) and the Netherlands (6bn) would have to make the biggest annual cuts to meet the deficit reduction targets within four years.
Member states could request to extend the cuts over a seven year period but risk to be in exchange for commitments to harsher anti-worker economic reforms.
Table 1: Comparison between cuts required every year under a four or seven year austerity plan
4 year plan 7 year plan
France 26,1 billion 14,2 billion
Italy 25,4 bn 13,5 bn
Spain 13,9 bn 8,9 bn
Germany 11,0 bn 5,8 bn
Belgium 7,5 bn 4,5 bn
Netherlands 6,4 bn 3,3 bn
Poland 4,4 bn 3,5 bn
Romania 4,3 bn 2,9 bn
Finland 2,4 bn 603 million
Austria 2,3 bn 1,4 bn
The ETUC published the figures ahead of the 16 January European Parliament vote on the future of the EU’s fiscal rules. The ETUC is calling on MEPs to ensure:
- That no so called ‘deficit safeguards’ are introduced because they will have a severe negative effects on GDP
- Investment needed for the green transition or the European Pillar of Social Rights must be protected and anti worker reforms need to be prevented
- Limits on debt to GDP ratio should start to decline after the end of the adjustment period
ETUC General Secretary Esther Lynch said:
“At a time when Europe should be investing in a green future, plans to reintroduce austerity would return Europe to its darkest period. It is incredible that national ministers have signed up to a plan that would force them to make spending cuts of more than 100 billion Euro in one year alone. Governments should be honest about what this will mean for their citizens: a huge number of job cuts, lower wages and worse working conditions, and further underfunding of public services. The European Parliament now has a crucial role to play in limiting the damage by ensuring the fiscal rules do not force countries to go too far and too fast in reducing their debt and deficit.”
Notes:
Excel file containing full figures
The figures are based on an assessment made by Bruegel in December 2023.
Table 2: Minimum annual cut in Euro required in 2025 under Council plan of either 4 or 7 years
4 year plan 7 year plan
France 26,1 billion 14,2 billion
Italy 25,4 bn 13,5 bn
Spain 13,9 bn 8,9 bn
Germany 11 bn 5,8 bn
Belgium 7,5 bn 4,5 bn
Netherlands 6,4 bn 3,3 bn
Poland 4,4 bn 3,5 bn
Romania 4,3 bn 2,9 bn
Finland 2,4 bn 603 million
Austria 2,3 bn 1,4 bn
Slovakia 2,3 bn 1,4 bn
Hungary 912 million 729 million
Greece 708 m 512 m
Czechia 567 m 467 m
Slovenia 518 m 315 m
Portugal 459 m 200 m
Bulgaria 446 m 308 m
Croatia (1) 340 m 212 m
Latvia 189 m 118 m
Lithuania 163 m 106 m
Malta 136 m 84 m
Luxembourg 107 m 62 m
Estonia 63 m 34 m
Cuts 2025.xlsx
Economic governance
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