Abstract

The paper studies the status of public finances of the Eurozone countries in the period before the Euro was introduced. The fiscal rules system has been investigated, which was adopted with the Maastricht Treaty and the Stability and Growth Pact, aiming to avoid the generation of excess deficits and debt encumbrances by the Member-States. The application of this system of fiscal rules was analyzed, inclusive its shortcomings, most of which are considered as one of the reasons for the crisis encountered in the Eurozone. The „quality” of the system was estimated and possible approaches how to reform it were presented.