As the right-wing Freedom Party (FPÖ) is set to take the reins of government in Austria, the European Commission is already putting pressure on the incoming leadership after it suddenly declared that it will punish Austria if it does not abide by the EU’s budget deficit rules.
A Commission spokesperson told Politico that “the EU is legally bound to decide whether to open a so-called excessive deficit procedure on Austria by the end of January.” For the Central European state to avert such a procedure, it must present a credible plan to cut spending to the Commission by January 21st at the latest, when the EU finance ministers hold their next meeting.
The warning comes as no surprise: whenever a conservative-sovereignist party wins an election or is on the verge of coming to power somewhere in Europe, it is issued with threats, and told it could be punished, or deprived of EU funds if it does not adhere to EU rules or “values.”
As we previously reported, the anti-globalist, right-wing FPÖ party won the federal elections in September, but, in an attempt to freeze them out of government, the country’s president tasked the second-placed centre-right People’s Party (ÖVP) with trying to form a government instead.
However, on Monday, FPÖ leader Herbert Kickl was finally given the opportunity to form a government with the ÖVP after the latter party failed to make a deal with the Socialists and the liberal NEOS party. According to Austrian reports, the leaders of the FPÖ and ÖVP are meeting on Friday, January 10th, with the budget being the main topic of discussion. The parties have to come up with a plan as soon as possible to lower the 4% budget deficit to below 3% over the coming years.
The European Commission can launch a so-called excessive deficit procedure against an EU country if it breaches or is in risk of breaching the deficit threshold of 3% of GDP, or if it has a government debt level above 60% of GDP, which is not diminishing at a satisfactory pace. The procedure may result in a fine.
Austria was originally supposed to send a report on its plan to consolidate its budget by last autumn, but the deadline was extended due to the September elections.
According to Kleine Zeitung, it is conceivable that Austria will be granted another delay due to the political situation—with no new government in sight. However, the liberal circles in Brussels are known for their double standards: right-wing parties do not get the same preferential treatment as leftists.
The Commission tried something similar last summer when Marine Le Pen’s National Rally was leading opinion polls before the French parliamentary elections at the end of June: the Commission signalled that it would not let a right-wing government “off the hook” with regards to France’s overspending, unlike their leniency with previous cabinets.
It is unclear where Austria can make savings, but, according to Frankfurter Allgemeine Zeitung, the two parties, both being sceptical of the EU’s radical climate policies, may choose to make cuts in energy policy projects for the expansion of renewable energies.
