The 2024 Stability and Growth Pact Reform: Is this time different?

The Stability and Growth Pact (SGP) was initially envisaged as an instrument to ensure fiscal discipline in EU member states, in line with the then-prevailing model of ‘stability-oriented’ economic governance in the EU. The SGP quickly demonstrated its limitations, however, and subsequently underwent several revisions. The 2024 SGP intends to strike a better balance between consolidating public finances (after years of increased indebtedness due to internal and external crises) and maintaining fiscal room for manoeuvre for the member states to invest in the green and digital transitions, energy security, and defence, which have been identified as key priorities by the EU. This article analyses the politics of the revision of the SGP using a liberal intergovernmentalism framework and demonstrates surprising continuity despite recent experiences with the NGEU budget. Although the 2024 SGP includes more flexibility to help Europe cope with rising internal and external challenges, it is unlikely to be more effective than its predecessor in controlling EU budgets.