EU's Barroso expects Spain's 2012 budget to respect EU rules

 

Spain's 2012 budget, which the government will present in March, has to fully respect European Union rules, the head of the EU's executive arm Jose Manuel Barroso said on Wednesday.

"I expect the budget will be fully in line with the Stability and Growth Pact rules," Barroso, who heads the European Commission, told a news conference.

Under the rules of the Stability and Growth Pact, which was toughened last year to include more and swifter financial sanctions for excessive budget deficits, Spain has until the end of next year to bring its budget gap below 3% of GDP.

Spain said earlier this week its 2011 budget gap was 8.5%, rather than the 6% of GDP it had aimed for.

"We do not have yet a full picture of Spain's fiscal slippage last year and the reason for that slippage," Barroso said, adding he expected more information on that in March.

"Only then can we take a position on the issue," he said, when asked if Spain's budget deficit targets under the EU's disciplinary budget steps should be relaxed.