Most of finance ministers from the 12-nation Eurozone on Monday night rejected calls for a significant relaxation of the fiscal rules underpinning the euro.
German Chancellor Gerhard Schroder proposed on his article in London-based Financial Times that budget deficits should be allowed to surpass more easily the limit of 3 per cent of gross domestic product (GDP).
"The stability pact will work better if intervention by European institutions in the budgetary sovereignty of national parliaments is only permitted under very limited conditions," said Schroder.
Schroder's intervention in the debate over the future of the European Union's stability and growth pact overshadowed Monday night's Eurogroup meeting of 12 single currency finance ministers in Brussels.
Jean-Claude Juncker, the Luxembourg prime minister and president of the Eurogroup, fears that could amount to a renationalizing of fiscal policy, which is a breach of EU treaty provisions for economic co-operation in the eurozone.
"Nobody in the Eurogroup thinks this is a good idea," said one Luxembourg official.
Karl-Heinz Grasser, Austrian finance minister and deputy Eurogroup president, also rejected Schroder's plan, calling for greater fiscal co-operation in the euro area and a greater role for the EU executive European Commission in policing the rules.
"A strong stability pact is a precondition of a successful euro, " he said.
EU finance ministers will continue their debate on reforming the pact at Tuesday's Ecofin Council in Brussels in an attempt to prepare a deal to present to heads of government at their economic summit on March 22 and 23.
They will also vote on whether to pursue action under the stability pact against Greece and Hungary over their alleged failure to control their deficits.