<p>New EU fiscal rules introduced in 2024 focus on reducing high debt ratios through controlling net expenditure growth. A similar spending constraint arose under the ‘Six Pack’ between 2012 and 2019 where member states that had not met their medium-term structural budgetary objective were expected to maintain net expenditure growth below that of medium-term output growth. Using a sample of 17 euro area member states, we examine the impact that this expenditure benchmark had on investment’s share of government spending and productive spending’s share during this period, accounting for the size of government debt ratios and whether countries were subject to the benchmark or not. Using both linear and quantile regression techniques, we find that high-debt member states that had not met their medium-term objective reduced their investment and productive spending ratios, while those with low debt ratios and which were not subject to the benchmark raised theirs. With the expenditure benchmark remaining as the central policy instrument under the revised EU fiscal rules, fresh commitments occurring in areas like digitalisation and decarbonisation, and high government debt ratios currently arising, the empirical analysis suggests that the new rules may act to inhibit member states’ ability to meet investment priorities in the years ahead.</p>