Warning for six countries on budget limit

The European Commission plans to warn Britain and five other countries that their budget deficits this year are likely to exceed limits set by the European Union’s rules on fiscal discipline, a top official said in Brussels.

“We will act tomorrow and it will be six countries,” EU Economics and Monetary Affairs Commissioner Pedro Solbes said ahead of testimony at European Parliament committee.

Asked whether reports identifying the six as Britain, Italy, France, Germany, Greece, and the Netherlands were correct, Solbes said: “It’s easy to figure out.”

He indicated the Commission would not seek now to go beyond the warnings and impose any disciplinary steps, such as those blocked last year by France and Germany.

The Commission is currently challenging that suspension of the rules at the European Court of Justice.

The budget warnings are to accompany the Commission’s spring economic forecast. Solbes said last week that he would probably revise the 2004 projected growth figure for the 12-country euro zone to 1.7%, down from 1.8%.

The EU’s so-called stability pact, adopted ahead of the single euro currency, obliges countries to keep their deficits below 3% of gross domestic product, but persistent economic sluggishness has made the target hard for many countries to meet.