Article 121 of the treaty on the functioning of the European Union (TFEU) requires the UK to send an annual convergence programme to the European Commission reporting upon its fiscal situation and policies. The UK’s convergence programme will be sent to the European Commission by 30 April. This deadline was set in accordance with the European semester timetable for both convergence and national reform programmes. The Government support the European semester which plays an important role in EU surveillance of economic and fiscal policy.
Section 5 of the European Communities (Amendment) Act 1993 requires that the content of the convergence programme must be drawn from an assessment of the UK’s economic and budgetary position which has been presented to Parliament by the Government for their approval. This assessment is based on the Budget 2014 report and the most recent Office for Budget Responsibility’s economic and fiscal outlook and it is this content, not the convergence programme itself, which requires the approval of the House for the purposes of the Act.
Article 121, along with article 126 of the TFEU, is the legal basis for the stability and growth pact, which is the co-ordination mechanism for EU fiscal policies and requires member states to avoid excessive Government deficits. Although the UK is bound by the stability and growth pact, by virtue of its protocol to the treaty opting out of the euro, it is only required to “endeavour to avoid” excessive deficits. Unlike the euro area member states, the UK is not subject to sanctions at any stage of the European semester process.
Subject to the progress of parliamentary business, debates will be held on 9 April for the House of Lords and on 30 April for the House of Commons in order for both Houses to approve this assessment before the convergence programme is sent to the Commission. While the convergence programme itself is not subject to parliamentary approval or amendment, I will deposit advanced copies of the document in the Libraries of both Houses on 3 April and copies will be available through the Vote Office and Printed Paper Office.
The UK’s convergence programme will be available electronically via HM Treasury’s website after it is sent to the European Commission.