The European Commission has proposed that eurozone countries submit their national budgets to the EU for ‘peer review’ before they go to national parliaments.

The Commission also said it would call on national leaders to agree a permanent crisis resolution mechanism.

The proposals come days after EU leaders backed a €750bn rescue fund for eurozone countries.

The Commission said the recent crises surrounding eurozone debt had exposed the vulnerability of countries and underlined their interdependence.

It said the time had come to draw 'far-reaching lessons' about the way economic policies were dealt with.