FRANKFURT (Reuters) - The European Union should take its fiscal rules seriously and end its leniency for privileged countries, Bundesbank President Jens Weidmann said on Thursday, adding that calls for Germany to spend more to help Europe's recovery are misguided.

The European Central Bank's ultra-easy monetary policy carries risks and the side effects are growing with time, but dialling back stimulus depends on sound public finances, said Weidmann, who sits on the ECB's Governing Council. The EU therefore needs to stop turning a blind eye to serial debt and deficit offenders, he said.

France and Italy have repeatedly failed to meet their budget commitments in recent years, and critics argue that the EU has been too lenient while taking a tougher stance on smaller countries.

Just this week, France's independent fiscal watchdog said the country's 2017 budget deficit target is unrealistic, casting doubt on the government's plan to cut the shortfall to less than 3 percent of output.

"We are concerned that the binding nature of Europe’s fiscal rules is under serious threat because individual exemptions are used excessively," Weidmann said in Berlin.

Quoting Goethe's Faust, Weidmann said the EU budget rules operated under the motto "In me there are two souls."

Running a budget surplus, Germany is one of a few countries in the euro zone with money to spend, and the ECB has repeatedly called on Berlin to open its coffers, much to the irritation of the government, which is expected to play up its fiscal prudence in next year's election campaign.

"The idea that Germany should go into debt in order to boost the economies of other euro area countries is wrong," Weidmann said. "Germany's economic standing does not warrant (such spending), the positive spillover effect for other countries would be low."

A key opponent of many ECB stimulus measures, Weidmann said that in principle, he considered the current expansionary monetary policy appropriate.

But as the ECB is considering potential future measures, he also cautioned against doing more.

"We should give time to the measures already adopted at first to take effect," he said. "With time, the positive effects of ultra-loose monetary policy diminish and the negative side effect increases."

To revive ultra-low inflation, the ECB has cut rates into negative territory and buys 80 billion euros worth of assets each month. As price growth is still barely above zero and the asset buys run out in March, the bank is now considering whether more action is needed.

(Reporting by Balazs Koranyi; Editing by Hugh Lawson)