Germany's opposition conservatives, the initiators of the Stability and Growth Pact, launched a savage attack on the government yesterday for "carrying the pact to its grave".
Dr Theo Waigel, the finance minister in the Kohl government that largely drafted the pact, called the decision of EU finance ministers a "catastrophe" for smaller EU states and a "huge loss of face for Germany".
"The pact protects the small countries from the big ones. And if the big ones get together in an unholy alliance the small ones feel swindled," he said, predicting a bad atmosphere in the EU in the future.
"The EU finance ministers have made a major mistake by suspending the \ procedures in a way that violates the pact." He said the pact was seriously damaged but not dead. "The countries that damage the pact damage themselves," he said.
Chancellor Gerhard Schröder rejected that view, saying the EU finance ministers had reached a "sensible compromise".
"I am absolutely convinced that finance minister Eichel acted properly," he said in Berlin.
Whoever polemicises or politicises will only compromise Germany's economic recovery, he said. The German leader repeated a favourite phrase of his, that the pact in question was called the Stability and Growth Pact and that sometimes growth targets had to be emphasised more than stability.
Mr Friedrich Merz, the finance expert of the Christian Democrats (CDU), said the budget decision had "violated the spirit of the pact".
"This is the end of the stability pact for the time being. It is a black day for all of Europe," he said on German television. Mr Guido Westerwelle, leader of the liberal Free Democrats, said the decision risked "discrediting the entire idea of the European Union".
Germany's powerful Bild tabloid lashed out at the government for its tactics.
"It should have been as hard as the deutschmark and solid as gold. No other country demanded so much or set as many conditions for the euro as us Germans. Now the government doesn't want to know any more," said the paper in an editorial.
"If all euro-zone countries behave as carelessly as this, the euro will become as soft as a jelly."
The government came under further criticism from federal auditors for wasting nearly €5 billion of taxpayers' money. They listed hundreds of examples of wasted money as a result of lax accounting and sloppy financial controls.
