THE European Union moved away from its focus on tough austerity yesterday when it gave France, Spain and four other member states more time to bring their budget deficits under control to support their economies.

Unveiling a series of country-specific policy recommendations in Brussels, the European Commission, the 27-nation bloc's executive arm, said the countries must implement structural reforms, such as overhauling labor markets to make their economies more competitive.

Commission President Jose Manuel Barroso said the pace of reform needed to be stepped up across the EU to solve the bloc's three-year crisis. "There is no room for complacency," he insisted.

Europe is stuck in a recession, with unemployment at record highs in several countries. This has led to a debate over the merits and faults of budget austerity as a way to solve the region's government debt problems.

By continuing to focus on controlling debt via austerity measures such as spending cuts and raising taxes, Europe's economic downturn has worsened and government revenues have been cut. This in turn makes it harder to meet deficit targets.

There is now a growing consensus that European governments must shift their budget policies more toward fostering growth to end the downward economic spiral.

Besides France and Spain, the commission is also granting the Netherlands, Poland, Portugal and Slovenia more time to bring their deficits below the EU ceiling of 3 percent of annual economic output. That means governments will be allowed to stretch out spending cuts over a longer time so as not to choke off growth as they try to fight record unemployment and recession.

The Netherlands and Portugal are granted one more year. France, Spain, Poland and Slovenia get two extra years each.