Brussels, 22/10/2010 (Agence Europe) - The European summit should provide “strong” backing for the report drafted by the taskforce headed by the president of the European Council, Herman Van Rompuy, suggested an EU ambassador on Friday 22 October (see EUROPE 10241). According to a draft version of the conclusions document by the Belgian Presidency that has been seen by EUROPE, the “European Council endorses the work of the taskforce on economic governance and its recommendations and proposals”. When implemented, the proposals will “increase fiscal discipline broaden economic surveillance, deepen coordination and set up a more robust framework for crisis management and stronger institutions”. European leaders are expected to call for introduction of the changed Stability and Growth Pact rules using a fast track approach. In the best of all worlds, the new legislation would be passed next summer.
In the draft conclusions document, there is no mention of the package of draft legislation unveiled by the European Commission late last month (see EUROPE 10225). The Commission' suggestions leave member states less room to manoeuvre than suggested by the taskforce when it comes to applying penalties on eurozone countries breaking the new EU public deficit and sovereign debt rules or the rules governing the pursuit of economic policy (see EUROPE 10225). The decision-making procedure decided upon by the ministers for applying penalties on eurozone countries was inspired (some suggest imposed) by the two big eurozone economies. It is criticised by the liberal party that is part of Germany's coalition government, by several European Parliament political parties and by the European Central Bank. Without expressing direct discontent, the Commission has been encouraging the EP, as co-legislator, to pull its full weight in the decision-making process in the future to ensure that a true European solution is decided upon.
What next? A paragraph in the European Council conclusions document has not yet been drafted. It covers the future of the taskforce and would require changes to the European treaties. This section will discuss the creation of a standing crisis management mechanism if a eurozone country is unable to finance its sovereign debt on the money markets, and also the option of withdrawing voting rights at the Council in the event of breaches of the new Stability and Growth Pact. An ambassador admits that member states are “highly sensitive” about the idea of revising the treaties and if a revision of the treaties is actually decided upon, then other countries would want to add different things and the whole process would then take much longer than predicted by France and Germany (2013 at the latest). The ambassador pointed out that a lot of countries want to go as far as possible without changing the treaties. The United Kingdom opposes any new transfer of national sovereignty to Europe. Earlier in the week, the chair of Eurogroup, Jean-Claude Juncker, commented that he was not very enthusiastic about changing the treaties. (M.B./transl.fl)