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Figure 4 - Number of numerical fiscal rules by sub-sector of general government

0

5

10

15

General Government Central Government Social Security Regional Government Local Government

General government sub-sector

Number of rules

Budget Balance rule Debt rule Expenditure rule Revenue rule

Source: Commission services.

There is also a large diversity as regards the aggregates targeted by the various types of rules (see Table
2). One third of budget balance rules in force target a balanced budget while one quarter are golden rules.
Interestingly, only few budget balance rules, all of them applying to the general and central governments,
are defined in structural (or cyclically-adjusted) terms. About half of debt rules, generally applied to local
governments, establish debt limits depending on the repayment capacity (e.g. limit to total indebtedness
in relation to current revenues). Expenditure rules are evenly distributed between those defining ceilings
and those targeting expenditure growth rates. While ceilings are generally expressed in nominal terms,
targeted growth rates are equally divided between nominal and real increases. Finally, more than half of
revenue rules establish pre-defined principles for the allocation of higher-than-expected revenues.

Table 2- Target definitions by type of rule^17

Golden rules budget rulesBalanced Nominal ceiling Ceiling as a % GDP

Rules in

structural

terms

Total

5851322

Debt ceiling in

nominal terms

Debt ceiling as

a % of GDP

Debt ceiling

related to

repaiment

capacity

Other Total

5271 15

Nominal

expenditure

ceiling

Real

expenditure

Ceiling

Expenditure

growth rate

(nominal)

Expenditure

growth rate

(reall)

Other Total

5233215

Tax burden as

a % GDP

Rule related to

tax rates

Allocation of

extra revenues Other Total

0131 5

Budget Balance

Rules

Debt Rules

Expenditure

Rules

Revenue rules

Source: Commission services.

The characteristics of the rules depending on the level of government to which they apply

Numerical fiscal rules in EU Member States are evenly divided between those that are incorporated into
a multi-annual budgetary framework and those applied on an annual basis. Rules applied to regional and
local governments rely preponderantly on annual schemes while most of those concerning the general

(^17) Without disaggregating fiscal rules according to number of sub-sectors concerned. Only rules in force in 2005 were
considered in this table (57 rules).