Europe’s fiscal rules need a makeover

My latest opinion piece for Reuters is out. In it, I explain as briefly as I can why I think the UK’s fiscal rules as well as the fiscal rules of the EU are not fit for purpose (well, I used a different word but my editor didn’t like it…). Current fiscal rules foster short-termism and procyclical fiscal spending.

Europe’s fiscal rules need a makeover: Klement

March 27 - In recent decades, poorly designed fiscal rules have forced UK and European Union governments to react to short-term fluctuations in economic growth and interest rates, making it more challenging for them to make the type of sound forward-looking decisions that are likely to enhance growth long term. What the UK and Europe need now are rules that differentiate between productive government investment and wasteful spending.

Read the full piece here: https://www.reuters.com/markets/europe/europes-fiscal-rules-need-makeover-klement-2025-03-27/