7.7.2005 Official Journal of the European Union L 174/1 | (Acts whose publication is obligatory) COUNCIL REGULATION (EC) No 1055/2005 of 27 June 2005 amending Regulation (EC) No 1466/97 on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies THE COUNCIL OF THE EUROPEAN UNION, Having regard to the Treaty establishing the European Community, and in particular Article 99(5) thereof, Having regard to the proposal from the Commission, Having regard to the opinion of the European Central Bank (1), Acting in accordance with the procedure laid down in Article 252 of the Treaty (%), Whereas: (1) The Stability and Growth Pact initially consisted of Council Regulation (EC) No 1466/97 of 7 July 1997 on the strengthening of the surveillance of budgetary positions and the surveillance and coordination of economic policies (), Council Regulation (EC) No 1467/97 of 7 July 1997 on speeding up and clarifying the implementation of the excessive deficit procedure (¥) and the Resolution of the European Council of 17 June 1997 on the Stability and Growth Pact (°). The Stability and Growth Pact has proven its usefulness in anchoring fiscal discipline, thereby contributing to a high degree of macroeconomic stability with low inflation and low interest rates, which is necessary to induce sustainable growth and employment creation. (2)  On 20 March 2005 the Council adopted a report entitled Tmproving the implementation of the Stability and Growth Pact’ which aims to enhance the governance and the national ownership of the fiscal framework by (1) O] C 144, 14.6.2005, p. 17. (3 Opinion of the European Parliament of 9 June 2005 (not yet published in the Official Journal), Council Common Position of 21 June 2005 (not yet published in the Official Journal) and Decision of the European Parliament of 23 June 2005 (not yet published in the Official Journal). () OJ L 209, 2.8.1997, p. 1. () OJ L 209, 2.8.1997, p. 6. () O] C 236, 2.8.1997, p. 1. strengthening the economic underpinnings and the effec- tiveness of the Pact, both in its preventive and corrective arms, to safeguard the sustainability of public finances in the long run, to promote growth and to avoid imposing excessive burdens on future generations. The report was endorsed by the European Council in its conclusions of 23 March 2005 (°), which stated that the report updates and complements the Stability and Growth Pact, of which it is now an integral part. According to the 20 March 2005 Ecofin report endorsed by the Spring 2005 European Council, the Member States, the Council and the Commission reaffirm their commitment to implement the Treaty and the Stability and Growth Pact in an effective and timely manner, through peer support and peer pressure, and to act in close and constructive cooperation in the process of economic and fiscal surveillance, in order to guarantee certainty and effectiveness in the rules of the Pact. Regulation (EC) No 1466/97 needs to be amended in order to allow the full application of the agreed improvement of the implementation of the Stability and Growth Pact. The Stability and Growth Pact lays down the obligation for Member States to adhere to the medium-term objective for their budgetary positions of ‘close to balance or in surplus’ (CTBOIS). In the light of the economic and budgetary heterogeneity in the Union, the medium-term budgetary objective should be differen- tiated for individual Member States, to take into account the diversity of economic and budgetary positions and developments as well as of fiscal risk to the sustainability of public finances, also in the face of prospective demo- graphic changes. The medium-term budgetary objective may diverge from CTBOIS for individual Member States. For euro area and ERM2 Member States, there would thus be a defined range for the country-specific medium-term budgetary objectives, in cyclically adjusted terms, net of one-off and temporary measures. (°) Annex 2 of conclusions of the European Council of 22 and 23 March 2005.