`Budget rigging' risks euro timetable

The credibility of the single currency will be called into question next week when new evidence is expected to emerge that several countries may be rigging their economic figures.

The Maastricht treaty set economic criteria for countries which wished to enter a single currency. But, now, European Union economists and statistical experts, monitoring adherence to the Maastricht criteria, are understood to have examined budget "massaging" in Italy, France, Spain, Belgium and Portugal.

The expert committee is understood to have looked at at least 10 cases in the countries in which one-off payments or temporary policy switches may have been used to ease deficits and debt, to help them gain entry to the single currency.

New signs that the convergence criteria may be weakly interpreted will renew calls from British Euro-sceptics for the Government to rule out joining the single currency in the first wave. John Major has stated that Britain would not join at the launch if the convergence criteria are not being strictly met.

Countries which want to qualify for the launch of European Monetary Union (EMU) must ensure that debt and deficit figures are in line by the end of this year. With the deadline approaching, the temptation to use creative accounting in several member states is intense.

The EU advisory committee, working closely with EU statisticians in Luxembourg, has looked at the legality of Italy's "Euro tax", proposed as a means of raising money to ease Italy's deficit. Roll-over bond payments which fund Italy's railways have also come under the committee's microscope.

And, it has looked at the decision in Madrid to freeze teachers' salary payments for 1997.

Belgium also faces criticism for attempting to ease its massive debt by asking local-government and social-security bodies to switch investments to government bonds.

The committee's findings will go to the European Commission, which will rule on any action.

The report will be closely studied, not just in Britain, but also by the governments of Germany and the Netherlands. The hard-line states are voicing mounting concern that the system of monitoring the convergence process is not impartial and may be designed to serve the interests of the states with economic problems.

There were signs in Brussels yesterday that pressure from countries who want the criteria to remain flexible may lead to a toning down of the committee's report. The European Commission has always been eager to accept a flexible interpretation of the Maastricht treaty.

France recently won endorsement from the Commission for a one-off payment from France Telecom to go towards its 1997 budget. The Bundesbank in Frankfurt and hawks in the Bonn finance ministry are still fuming over the Commission's decision, sayingBrussels overrode the view of the majority of member states.

Bundesbank officials said this week they would be watching further commission rulings on convergence very closely. The officials privately accused the Commission - and, particularly, Yves-Thibault de Silguy, the economics commissioner, who is French, of "dirty tricks".

If European member states do not adhere to strict convergence rules there are growing fears in Germany that German Euro-sceptics may challenge the EMU process in the German constitutional court.

If the Maastricht treaty is seen to be overridden for the sake of achieving the EMU deadline the constitutional court could rule that Germany's membership should not go ahead.

n Bonn (Reuters) - The Spanish Prime Minister, Jose Maria Aznar, arrived in Bonn for consultations on Madrid's determination to join the EU single currency at the outset, despite reservations expressed in Germany. Spanish delegation sources say Aznar is hoping for acknowledgement that Spain is on course to join EMU.

Start your day with The Independent, sign up for daily news emails
News
Sir David Attenborough
people
Life and Style
Young girl and bowl of cereal
food + drink
Arts and Entertainment
Henry VIII played by Damien Lewis
tvReview: Scheming queens-in-waiting, tangled lines of succession and men of lowly birth rising to power – sound familiar?
News
news
PROMOTED VIDEO
Have you tried new the Independent Digital Edition apps?
ebooks
ebooksA year of political gossip, levity and intrigue from the sharpest pen in Westminster
Sport
football
Arts and Entertainment
'The Archers' has an audience of about five million
radioA growing number of listeners are voicing their discontent; so loudly that even the BBC's director-general seems worried
News
i100
Life and Style
David Bowie by Duffy
fashion
Arts and Entertainment
Hell, yeah: members of the 369th Infantry arrive back in New York
booksWorld War Z author Max Brooks honours WW1's Harlem Hellfighters in new graphic novel
News
advertisingVideo: The company that brought you the 'Bud' 'Weis' 'Er' frogs and 'Wasssssup' ads, has something up its sleeve for Sunday's big match
Latest stories from i100
Have you tried new the Independent Digital Edition apps?
Independent Dating
and  

By clicking 'Search' you
are agreeing to our
Terms of Use.

iJobs Job Widget
iJobs General

Tradewind Recruitment: English Teacher

Negotiable: Tradewind Recruitment: This post arises as a result of the need to...

Tradewind Recruitment: Class Teacher Required ASAP In Uminster

£120 - £150 per annum: Tradewind Recruitment: I am recruiting on instruction o...

Ashdown Group: Head of Finance - Financial Director - London - £70,000

£70000 per annum: Ashdown Group: Head of Finance - Financial Controller - Fina...

Ashdown Group: Marketing Executive - Wimbledon, SW London

£24000 - £28000 per annum + benefits: Ashdown Group: Marketing Executive - Wim...

Day In a Page

Isis hostage crisis: Militant group stands strong as its numerous enemies fail to find a common plan to defeat it

Isis stands strong as its numerous enemies fail to find a common plan to defeat it

The jihadis are being squeezed militarily and economically, but there is no sign of an implosion, says Patrick Cockburn
Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action

Virtual reality: Seeing is believing

Virtual reality thrusts viewers into the frontline of global events - and puts film-goers at the heart of the action
Homeless Veterans appeal: MP says Coalition ‘not doing enough’

Homeless Veterans appeal

MP says Coalition ‘not doing enough’ to help
Has The Archers lost the plot with it's spicy storylines?

Has The Archers lost the plot?

A growing number of listeners are voicing their discontent over the rural soap's spicy storylines; so loudly that even the BBC's director-general seems worried, says Simon Kelner
Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Human skull discovery in Israel proves humans lived side-by-side with Neanderthals

Scientists unearthed the cranial fragments from Manot Cave in West Galilee
World War Z author Max Brooks honours WW1's Harlem Hellfighters in new graphic novel

Max Brooks honours Harlem Hellfighters

The author talks about race, legacy and his Will Smith film option to Tim Walker
Valentine's Day cards: 5 best online card shops

Don't leave it to the petrol station: The best online card shops for Valentine's Day

Can't find a card you like on the high street? Try one of these sites for individual, personalised options, whatever your taste
Greece elections: In times like these, the EU has far more dangerous adversaries than Syriza

Greece elections

In times like these, the EU has far more dangerous adversaries than Syriza, says Patrick Cockburn
Holocaust Memorial Day: Nazi victims remembered as spectre of prejudice reappears

Holocaust Memorial Day

Nazi victims remembered as spectre of prejudice reappears over Europe
Fortitude and the Arctic attraction: Our fascination with the last great wilderness

Magnetic north

The Arctic has always exerted a pull, from Greek myth to new thriller Fortitude. Gerard Gilbert considers what's behind our fascination with the last great wilderness
Homeless Veterans appeal: Homeless in Wales can find inspiration from Daniel’s story

Homeless Veterans appeal

Homeless in Wales can find inspiration from Daniel’s story
Front National family feud? Marine Le Pen and her relatives clash over French far-right party's response to Paris terror attacks

Front National family feud?

Marine Le Pen and her relatives clash over French far-right party's response to Paris terror attacks
Pot of gold: tasting the world’s most expensive tea

Pot of gold

Tasting the world’s most expensive tea
10 best wildlife-watching experiences: From hen harriers to porpoises

From hen harriers to porpoises: 10 best wildlife-watching experiences

While many of Britain's birds have flown south for the winter, it's still a great time to get outside for a spot of twitching
Nick Easter: 'I don’t want just to hold tackle bags, I want to be out there'

'I don’t want just to hold tackle bags, I want to be out there'

Nick Easter targeting World Cup place after England recall