The name is absent

GDP deficit limit; (ii) ensure rapid progress towards sustainability; and, (iii) taking
account of the first two, allow room for budgetary manoeuvre and in particular public
investment. The MTOs should furthermore be revised when a major reforms that improve
fiscal sustainability have been undertaken, or at least every four years. It would be an
advantage if fiscal indicators reflected the long-term budgetary impact of major reforms
and the design of fiscal imbalance indicators therefore was made in such a way that they
displayed this desirable property.

The fiscal imbalance measure proposed in the chapter could actually underestimate the
sustainability challenge. Indeed, if there is a fiscal imbalance after the last year (i.e.
2051), or, if there is an ageing impact also beyond that year, this would not be captured
by the measure. This would, as for example in the mainstream US Congressional Budget
Office (CBO) calculations, give rise to the ‘rolling window’ problem; when the horizon is
extended, an additional imbalance is added. Fiscal indicators for assessing the long-term
sustainability of public finances should gainfully reflect the size of the fiscal challenge, or
imbalance over the long-term. The design of fiscal imbalance indicators could therefore
be made in a way so that they avoid possible underestimation of the size of the challenge
by opting for an infinite horizon rather than an ad hoc cut-off point, as indeed highlighted
in the chapter.

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