This exercise was based on the economic governance rules of the Stability and Growth Pact, prior to their 2024 reform.
Member States sharing the euro currency did this in "Stability Programmes", while Member States that had not adopted the euro submitted "Convergence Programmes", which include additional information about monetary policies.
These documents were used by the Commission and by finance ministers to assess whether Member States were on track towards reaching their Medium-Term Budgetary Objectives (MTOs) on the basis of two pillars: structural balance analysis and the expenditure benchmark.
Guidelines on the content and format of the programmes were covered by a code of conduct:
Content of the former Stability Programmes and Convergence Programmes
- A Medium-Term Objective (MTO), as budgetary target set by each Member State, defined in structural terms. Member States had to also set out yearly targets on the way towards the MTO and forecast the expected path of their debt-to-GDP ratios.
- Underlying economic assumptions about growth, employment, inflation and other important economic variables.
- A description and assessment of policy measures to achieve the programme objectives.
- An analysis of how changes in the main economic assumptions would affect the budgetary and debt position.
- Information covering several years including: one year of budgetary execution, the current budgetary year, and plans for the three following years.
- If applicable, an explanation for why targets were not being met.
Assessment of Stability Programmes and Convergence Programmes
Stability Programmes submitted by euro area Member States had to be based on macroeconomic forecasts produced or endorsed by independent bodies. These forecasts were compared with those of the Commission and, when appropriate, with those of other independent bodies. Any significant differences between the scenarios adopted by governments and the Commission’s forecasts had to be explained. Convergence Programmes had to be based on sound fiscal scenarios.
As part of the European Semester, the EU’s annual economic governance cycle, the Commission assessed Stability Programmes and Convergence Programmes both before and after implementation. This allowed the Commission to identify and discuss any risks of non-compliance with the Stability and Growth Pact before they occur, and to identify any actual instances of non-compliance that could ultimately warrant sanctions.