EU ministers get tough with Spain and Hungary over deficit

Spain has to save an additional €5bn on its budget this year, while Hungary has been told it stands to lose €500m in EU funds if it does not get its budget back on track over the next three to six months.

The tough decisions by EU finance ministers were hailed as a victory for strict new national budget rules just agreed by the member states, despite a battle to ease the pressure on both countries.

Spain, whose deficit overshot its target last year, is forecast to do the same this year from the original target of 4.4%. They had hoped to be allowed to extend the deficit to 5.8%, but were told to take another €5bn off its spending to ensure the deficit is no more than 5.3%.