Pruebas básicas de servicios

Aside from the long-term costs of ageing (LTC) the current budgetary and debt position also contribute to the sustainability gap for a majority of countries. According to the initial budgetary position (IBP) component of both S2 and S1 indicators and the debt requirement (DR) (15_{) for}

S1, only one fifth of Member States have an initial fiscal position which would be sustainable if long-

(15_{) The initial level of debt enters the IBP term, as it}

determines the required primary surplus to service it. However, it also directly enters the S1 indicators through the additional effort required to bring debt to 60% of GDP by 2060.

term costs were left aside. Another third require an adjustment of up to around 3% of GDP to the structural public balance to place their public finances on a sustainable path, even before considering the long-term budgetary impact of an ageing population. The remaining Member States have an initial fiscal position that would require an even greater adjustment.

According to the IBP component of S2 indicator, for the Czech Republic, France, Lithuania, Poland, Portugal, Slovenia Slovakia and Romania, the required correction is in the region of 3 to 5% of GDP. For Spain it is slightly above 6% of GDP, while Latvia, UK and Ireland – given their very large structural imbalances in 2009 – require adjustments of over 8% of GDP.

The IBPs are calculated using the budgetary position of 2009 – drawn from the European Commission spring forecasts (16_{) from May 2009.}

– as starting point. As discussed in Chapter I, the structural primary balance is used in the calculation of the sustainability gap indicators. This removes the estimated effect of the economic cycle from the primary balance and also removes the effect of one-off measures. Some of the automatic effect of the economic crisis on budgets is therefore stripped out of from the data. However, structural adjustment can only be undertaken imperfectly and this is particularly the case in the middle of such unprecedented economic times. In so far as the crisis leads to a durable reduction in economic activity and growth, the structural deficit and sustainability gaps could be underestimated. However, on the other hand, some of temporary stimulus measures adopted by government may have not been properly filtered out when estimating the structural deficits and may currently appears as deteriorating the structural deficits.

(16_{) European Economy, 3 (4 May 2009).}

European Commission Sustainability Report - 2009

While the long-term consequences of the crisis on the economies and public finances of the EU Member States are still unclear, the debt and deficit figures that contribute to deriving the IBP and DR indicators, as well as the growth and other assumptions going forward are therefore liable to change. Alternative scenarios for the macroeconomic environment and its consequences are presented in Chapter IV.

In order to look at the role of the initial structural balance in more detail, Table III.1.2 shows how this has changed in recent years. The first column shows the average for the 2004-09 period, the second the absolute difference and finally the 2008 outturn, and forecasts for 2009 and 2010. Overall just under one quarter of Member States have improved their structural balance, and on average the structural balance for the EU-27 and for the Euro Area countries deteriorated by 1.5 and 0.9 percentage points of GDP respectively between 2004 and 2008.

Amongst Member States with a deterioration in the structural balance, Bulgaria, Denmark, Portugal and Sweden have had a loosening of under 1 p.p. of GDP between 2004 and 2008; Belgium, France, Lithuania, Netherlands and Finland between 1 and 2 p.p. of GDP; the Czech Republic, Estonia, Austria, Romania, Slovenia and Slovakia 2 and 5 p.p. and Ireland, Spain, Latvia and UK over 5 p.p. of GDP. According to the IBP component, most of these countries have large sustainability gaps, indicating that this loosening has been an important contributor to the fiscal adjustment that needs to occur for sustainability to be ensured in the future. This can also be seen by observing the size of the structural balance in Table III.1.2 as the link between the initial structural primary balance and the sustainability indicators is direct – a change in the structural balance feeds into an equivalent increase or decrease into the sustainability gap indicator. Conversely, a number of countries, and in particular Hungary and Cyprus, have strengthened their structural balances significantly.

Table III.1.2: Government structural balances (% of GDP)

2004-2009 average

Difference between

2009 and 2004 2008 out-turn 2009 forecast 2010 forecast

BE -1.8 -1.9 -2.2 -3.2 -4.0 BG 1.0 -0.4 0.2 0.3 1.6 CZ -3.1 -2.2 -3.4 -4.0 -3.7 DK 3.1 -0.9 4.2 1.2 -0.4 DE -2.2 1.1 -1.2 -2.4 -3.9 EE -0.8 -3.0 -4.1 -1.0 -1.9 IE -2.6 -10.2 -7.5 -9.8 -12.2 EL -5.8 2.8 -6.5 -5.7 -4.7 ES -0.9 -7.5 -3.9 -6.8 -8.2 FR -4.2 -1.4 -4.3 -5.5 -5.5 IT -3.8 2.4 -3.4 -2.6 -2.8 CY -1.5 2.9 0.1 -2.1 -2.1 LV -4.4 -8.1 -5.8 -9.5 -11.5 LT -3.1 -1.8 -5.2 -4.3 -5.5 LU 0.3 1.4 2.0 0.6 0.1 HU -6.4 5.4 -4.5 -1.7 -2.0 MT -4.1 2.2 -4.9 -3.6 -2.8 NL -0.8 -1.5 -0.5 -2.6 -4.3 AT -1.8 -2.8 -1.8 -3.2 -3.8 PL -4.9 0.0 -5.3 -6.0 -5.6 PT -4.5 -0.5 -3.8 -5.5 -5.1 RO -4.1 -3.3 -7.9 -5.2 -4.7 SI -2.3 -3.2 -2.5 -4.9 -5.2 SK -3.5 -3.1 -4.7 -5.0 -4.7 FI 2.5 -1.8 2.8 0.8 -0.7 SE 0.8 -0.3 1.7 -0.5 -1.9 UK -5.1 -6.1 -5.6 -10.0 -12.2 EA-16 -2.7 -0.9 -2.8 -3.9 -4.7 EU-27 -3.0 -1.5 -3.1 -4.6 -5.5 Structural balance

Source: Commission services

Chapter III Quantitative sustainability results

It is now evident that the fiscal deficits are deteriorating substantially in 2009 relative to 2008 and a further weakening of the public balance beyond the effects of the business cycle is projected for 2010. The expected deterioration in the structural balances can be seen in Table III.1.2. While the average structural balance for 2008 stood at –3.1% for EU-27, in 2009 it is expected to be –4.6% before falling further to –5.5% in 2010. Thus, if 2010 was used as the base year for the analysis in this report, the results would indicate greater sustainability gaps caused by the weaker starting balances.