Tomorrow, European Union finance ministers will discuss a timely European Commission report on the sustainability of public finances. After several years when the stability and growth pact, the eurozone’s budgetary rules, was little more than a political inconvenience and embarrassment for the laggards – leading to a sweeping reform last year that rubber-stamped excessive deficits in “exceptional circumstances” – it seems most countries are returning to the virtuous path of fiscal discipline.

Buttressed by healthier growth, at least by continental European standards, Germany and France are set to comply with the deficit ceiling of 3 per cent of gross domestic product. Even Italy is making serious efforts to bring its runaway deficit under control. Against the backdrop of good economic news, the much-needed public debate on fiscal sustainability is in danger of being drowned out. Far from being in safe waters, either in its international competitiveness or in the stability of its public finances, Europe needs an honest, long-term view on this issue.