[3] Measures such as budget deficits and public debt levels are assessed, as well as the inflation situation and the stability of the national currency exchange rate of a European Union member state.
[1][2] During the late nineties, according to the figures submitted by the Greek government to the European Union, Greece's high budget deficits were significantly lowered.
In reaction, the NSSG (National Statistical Service of Greece) revised the debt level by several percentage points.
George Papandreou, of Panhellenic Socialist Movement (PASOK), the main opposition at that time, and the other two smaller parties initially agreed with the need for an audit.
The above has led the Greek minister of finance to clarify that the 1999 budget deficit was below the prescribed 3% limit when it was calculated with the ESA79 methodology in force at the time of Greece's application.
"Irregularities" (the word falsification never officially used) in deficit reporting were also revealed for other Eurozone members, most notably Italy and Portugal,[citation needed] with significant revisions imposed.
Also, there were arguments about massive "creative accounting" employed by many states in order to meet the deficit criterion for entry into the Eurozone.
It was argued that New Democracy government simply miscalculated the consequences of its actions, which brought a strong reaction by Eurostat, stronger than that for other violators.
In March 2006, Eurostat made changes to the system of defense expenditure calculation,[6] which seemed to legitimize some of the practices of the previous Costas Simitis government of PASOK.