Members of the European Parliament are rejoicing today (15 September) as they announce new rules which for the first time will grant more power to Brussels than to member states in policing the debt levels of troubled eurozone countries.
The agreement, announced on Thursday (15 September), draws a line under caustic rows over who should have the ultimate say on countries' national budgets, with the eurozone crisis underscoring the need for greater EU involvement in policing national debt levels.
"Yesterday the Presidency, the European Parliament and the European Commission had a fruitful discussion on the remaining issues concerning the six legislative acts on economic governance in the EU. As a result, the package of compromise proposals has been worked out," a spokesperson for the EU's rotating presidency, currently held by Poland, said in a statement.
By striking a deal on the so-called "six-pack" of legislation on economic governance, the EU hopes to undo the kind of political cronyism which damaged the credibility of the Stability and Growth Pact, which limits public debt and deficits.
In 2002, Germany and France collided with the European Commission when they decided to sideline the legislator's recommendations on bringing debts back down below a 3% of GDP ceiling.
Since the reform of the Stability and Growth pact in 2010, the European Parliament has taken the opportunity to prevent countries from ignoring the Commission's guidelines on lowering their debts, known as "excessive deficit procedures".
On Thursday, MEPs will announce a new measure dubbed a "final warning" whereby a country has already been given an opportunity to take measures to lower its debts and can only circumvent Brussels' advice by getting the support of other countries.
To give countries the chance to amend their budgets, the final warning will have a cooling-off period of one month before any more pressure is put on the country by Brussels.
And when the Commission issues such a warning, this can only be disregarded if a majority of eurozone countries rally behind that country – that means nine out of 17 countries will have to say they support the country's decision to disregard the EU executive's advice.
The entire package spans a preventative phase, which includes the "final warning," and a corrective phase, which includes fines on countries to be fed into an interest-bearing deposit.
MEPs also managed to get all parties to approve a fine on botched statistics after Greece was caught out last year for tampering with its figures to escape scrutiny.
Though the three sides came a long way towards putting an end to terse negotiations, the agreement reached last night is a provisional deal and MEPs are due to vote on the package at their plenary session in the final week of September.