The European Fiscal Board (EFB) is the

fiscal council A fiscal council is an independent body set up by a government to evaluate its expenditure and tax policy. Typically, councils are staffed by economists and statisticians who do not have the ability to set policy, but provide advice to governments ...

of the

European Union The European Union (EU) is a supranational political and economic union of member states that are located primarily in Europe. The union has a total area of and an estimated total population of about 447million. The EU has often been des ...

, watching over its

fiscal sustainability Fiscal sustainability, or public finance sustainability, is the ability of a government to sustain its current spending, tax and other policies in the long run without threatening government solvency or defaulting on some of its liabilities or promi ...

. It was instituted in 2016 as one of the elements proposed by the ''Five Presidents’ Report'' in June 2015.

History

The ''Five Presidents' Report'' report was prepared by then-

President of the European Commission The president of the European Commission is the head of the European Commission, the executive branch of the European Union (EU). The President of the Commission leads a Cabinet of Commissioners, referred to as the College, collectively account ...

Jean-Claude Juncker Jean-Claude Juncker (; born 9 December 1954) is a Luxembourgish politician who served as the 21st Prime Minister of Luxembourg from 1995 to 2013 and 12th President of the European Commission from 2014 to 2019. He also served as Finance Minister ...

, in close cooperation with the presidents of the

European Council The European Council (informally EUCO) is a collegiate body that defines the overall political direction and priorities of the European Union. It is composed of the heads of state or government of the EU member states, the President of the E ...

Eurogroup The Eurogroup is the recognised collective term for the informal meetings of the finance ministers of the eurozone—those member states of the European Union (EU) which have adopted the euro as their official currency. The group has 19 member ...

European Central Bank The European Central Bank (ECB) is the prime component of the monetary Eurosystem and the European System of Central Banks (ESCB) as well as one of seven institutions of the European Union. It is one of the world's Big Four (banking)#Intern ...

, and the

European Parliament The European Parliament (EP) is one of the legislative bodies of the European Union and one of its seven institutions. Together with the Council of the European Union (known as the Council and informally as the Council of Ministers), it adopts ...

Activities

The European Fiscal Board is mandated to make an independent assessment of the implementation of the

Stability and Growth Pact The Stability and Growth Pact (SGP) is an agreement, among all of the 27 member states of the European Union, to facilitate and maintain the stability of the Economic and Monetary Union (EMU). Based primarily on Articles 121 and 126 of the Trea ...

, the set of common rules imposing limits on the EU member states' national fiscal policymaking. The main objective of the commonly agreed fiscal rules is to avert negative cross-border effects of national fiscal policies and to secure a smooth functioning of the

Economic and Monetary Union An economic and monetary union (EMU) is a type of trade bloc that features a combination of a common market, customs union, and monetary union. Established via a trade pact, an EMU constitutes the sixth of seven stages in the process of economic ...

. The European Fiscal Board also issues advice on the general orientation of fiscal policy in the

eurozone The euro area, commonly called eurozone (EZ), is a currency union of 19 member states of the European Union (EU) that have adopted the euro (€) as their primary currency and sole legal tender, and have thus fully implemented EMU policies ...

. In 2020, the European Fiscal Board supported the activation of the severe economic downturn clause of the Stability and Growth Pact. The clause allows for extra flexibility when applying the rules of the Pact. Over the years the European Fiscal Board has issued a number of proposals on how to improve the EU's fiscal framework.

References

European Commission projects Fiscal policy Agencies of the European Union {{EU-stub