Rethinking Preventive Economic Surveillance in the European Union: Origins and Features of the Structural Plan Reform

We analyse the process that led to the most comprehensive reform of the preventive arm of the European economic governance, the main divides during the negotiations, and the new design. Even though a reform was planned, the debate was heavily shaped by the new economic environment engendered by the Covid-19 pandemic. Following the Commission’s proposal, three main divides emerged during the negotiations. Two are well-known issues that have characterized past reforms: the debate over national flexibility in implementation and the institutional balance of power. The third conflictual issue concerned the role of the European Fiscal Board and of national independent fiscal authorities. These institutional innovations reflect attempts to defuse the politicized tensions that often characterize fiscal decision-making and to prevent blame-shifting to the supranational level. Lastly, the new design further increases the number of provisions in force. On the one hand, it reinforces the centrality of the Council. On the other hand, it allows member states greater flexibility in implementation.