BONN, Germany (CN) – The European Union’s legislative branch adopted measures to control the euro crisis, approving the so-called “six-pack” of reforms that grants the executive branch greater enforcement power and imposes economic sanctions on member countries that allow ballooning debt.
The measures, which passed through the European Commission in late September, set a ceiling on public debt at 60 percent of a country’s gross domestic product. They also ascribe increased fiscal surveillance duties to the commission and grant that executive body the ability to fine governments up to 0.2 percent of their GDP if they surpass the prescribed debt ratio.
Under the reforms, EU legislators with the European Council need a supermajority to overturn the commission’s debt actions. The council approved the reforms last week.
Financial Commissioner Olli Rehn expects the six-pack to take effect by mid December.
“Mark my words: I intend to fully implement the new rules from day one,” Rehn said at a press conference, adding that the commission’s current monitoring mission in Italy is already taking the approach intended in the reforms.
Council approval came as the commission issued its economic forecast for the EU, which put growth at a minimal 0.5 percent for all of next year.
“Economic recovery has come to a standstill,” the commission said in a statement, citing deteriorating consumer confidence and weakening global growth.
The commission’s enhanced powers on debt issues in member states, which could be seen as an attempt to streamline decision-making for the 17 nations in the euro zone, have also been criticized as strong-arming in economic governance.
Germany and France, Europe’s economic powerhouses, have banded together to shape policy on the debt crisis for the bloc, including helping to scuttle a proposed referendum on Greece’s bailout.
Meanwhile, technocrats are slated to lead Greece and Italy as the former administrations step down.
Lucas Papademos, who replaced Georgios Papandreou as Greece’s prime minister, was previously president of the European Central Bank. Mario Monti, an economist and former EU commissioner, took the reigns for Italy after the resignation of Silvio Berlusconi.