EMU: COMMISSION TO ASSESS ANOTHER SIX UPDATED CONVERGENCE/STABILITY PROGRAMMES.

Luxembourg.

The Commission considers that the stability programme presented by Luxembourg is based on a "credible macro-economic scenario, though perhaps a little optimistic towards the end of the period" (whereas the Commission is anticipating growth of 4.5% in 2007, Luxembourg is projecting a figure of 4.9% in 2007 and 2008). In its Recommendation to the Council, the Commission suggests that Luxembourg's budgetary position appears "sufficiently sound to ensure that medium-term objectives are achieved by 2008, provided the measures announced for 2007 and 2008 are specified and properly implemented". The Commission believes there is a risk of Luxembourg's deficit overshooting the 3% of GDP threshold in 2006. Regarding the sustainability of public finances, the Commission considers that the country to be at a medium risk in view of projections regarding budgetary costs linked to an ageing population.

Recommendations: the Commission suggests it would be prudent to "enhance budgetary consolidation efforts in 2006" and proposes "identifying necessary consolidation measures for implementation in 2007 and 2008". The Recommendation also emphasises the need for Luxembourg to notify its long-term programme for addressing the consequences of an ageing population to the Commission.

Austria.

Here again, the Commission considers that the Austrian stability programme update is based on a "credible macro-economic scenario". Budgetary objectives have not been altered in relation to Austria's previous forecasts. The Commission considers that the medium-term budgetary objective for 2008 is "balanced". Austria's efforts are therefore in line with the stability pact. Though the Commission's Recommendation emphasises risks to medium-term objectives being achieved by 2008, Austria's strategy "can be deemed appropriate".

Recommendations: the Commission calls on Austria to ensure that its medium-term stability programme is completed by the end of the period through specific measures "contributing to budgetary consolidation as envisaged for the final two years of the programme".

Belgium.

The Commission recalls that the Belgian authorities have in the past shown a "firm responsibility" in balancing their budget. New Belgian stability programme forecasts "broadly" confirm this trend, since Belgium not only expects to achieve a balanced budget in 2006, but is even anticipating a surplus of between 0.3 and 0.7% of GDP between 2007 and 2009. Regarding the Kingdom's debt...