Not surprisingly, the Eurogroup meeting in an inclusive format on Monday 11 February, suggested significant differences of opinion between Member States on the architecture and implementation of future fiscal capacity for the euro area.
Mário Centeno, the president of the Eurogroup, was nevertheless optimistic. "You all remember this was a controversial issue in December, but we are in a new phase now [...] The attitude around the table is constructive and I am sure we will come to an agreement in time for June", he said at the end of the meeting.
This discussion on the fiscal capacity for the euro area to support competitiveness and convergence was the first substantive discussion after the mandate given by the euro area summit to the Eurogroup to deepen the proposal submitted last December (see EUROPE 12160).
The Finance Ministers of the Twenty-Seven (all but the British) were thus to discuss three aspects of this instrument: expenditure, the origin of funds for budgetary capacity and governance (see EUROPE 12189).
There are very different views on these three points. "Some positions are well known and remain quite entrenched”, said Pierre Moscovici, Commissioner for Economic and Financial Affairs. "But I found the climate constructive", he said.
On the expenditure side, the Member States do not agree on the purpose of the sums that can be allocated. Some countries, particularly in Southern Europe, are in favour of public and social spending, while some States, in Northern Europe among others, would like this spending to accompany structural reforms. Questions also arise about the legal basis and instrument used.
On financing, several Member States, such as the Netherlands, want this budgetary capacity to be an integral part of the multiannual financial framework (MFF), while others, such as France, prefer to allocate non-MFF own resources to it.
With regard to governance, EU Member States that have not adopted the common currency would like to have a right of scrutiny over the decisions taken, while euro area Member States are more in favour of a 19-nation governance. For France, an intergovernmental agreement with 19 Member States is necessary to determine national contributions, even if the budgetary capacity would be managed on a daily basis by the Commission with control by the European Parliament.
In view of these differences, Mr Centeno's objective of reaching an agreement in June seems ambitious. However, the negotiations are closely linked to the post-2020 MFF negotiations, hence the need for ministers to respect this timetable. (Original version in French by Lucas Tripoteau)