Jean-Claude Juncker says ‘exceptionally serious problem’ in countries such as Germany, Italy and Croatia could prompt European Commission to offer leeway.
BRUSSELS—European Union governments will be able to offset some of the costs related to the migrant crisis from the EU’s budget deficit rules, according to a top EU official in charge of policing national budgets.
Under EU rules, governments have to stick to a budget deficit of 3% of GDP or face fines.
“It will be a country-by-country assessment, but we will bear in mind the cost entailed by refugee policies more than up to now,” European Commission chief Jean-Claude Juncker told the European Parliament in Strasbourg on Tuesday.
Mr. Juncker said that given the “exceptionally serious problem” of the refugee crisis, there will be some room for maneuver for the Commission, the EU executive, when assessing the countries’ budget deficits.
“If a country is making huge efforts, there should be a commensurate understanding of what they have done. If a country is unable to prove it’s affected by the cost of refugee policies, then we won’t necessarily apply the flexibility of the Stability and Growth Pact to them,” Mr. Juncker said.
Germany, the main destination country for refugees arriving in Europe, is expected to triple its budget for accommodating asylum seekers to an estimated €15 billion. Germany’s current deficit is within the EU rules, but that may change by the end of the year.
Austria and Italy, two countries affected by the migration crisis and whose budgets are likely to surpass the 3% threshold, have already been pressing the Commission to exempt their refugee spending from the EU’s budget assessment. Fiscal hawks, however, including Germany’s own finance minister, Wolfgang Schäuble, have been wary of supporting that call, for fear that other countries will seize the opportunity and offset budget expenditures which aren’t necessarily refugee-related.
Greece, Croatia and Slovenia—all countries on the main migrant route into Europe—are already in breach of the 3% deficit rule. They are likely to get their deadlines for reaching 3% extended if they can prove that the refugee crisis has taken a toll on their already-strapped coffers.