Some reactions are taking shape. Following the rejection of the Constitution by two of the founding countries (France and the Netherlands), a double stumbling block has to be avoided: sliding into discouragement and considering that European construction is blocked together with the Constitution, with the illusion that everything will continue as before and that we can ignore the warning given by the people. The first to take the situation into hand was the president of the European Council Jean-Claude Juncker, who highlighted the indispensable priorities: a) adopt the financial perspectives for 2007-13 this month as an essential message of the EU's resolve to pursue its course and provide the resources for the ambitious medium-term programmes; b) get the people to better understand the reality of European construction and the advantages that it brings to everyone (see this section in bulletin 8960).
Message on financial perspectives. The most important move is on financial perspectives because it is practical and can be see by the public. Juncker's call did not go unheard. France and Germany, in particular, indicated that they would not remain glued to the 1% of European income for Union spending. Chancellor Schröder declared that he was “ready to shift” and that he hoped that “the other Member States will also agree to make a gesture” (clear reference to the British), and the spokesperson for Jacques Chirac stated that “the president completely agrees with this approach” (see our bulletin 8962). The compromise presupposes a certain rebalancing of the net contributions of Member States (by reducing somewhat those of Germany, Netherlands and Sweden), the freezing at first, followed by the reduction of the “British cheque”, the gradual decrease of funding in support of the current main beneficiaries of cohesion policy (Italy and Spain, above all), and the reduction grants proposed by the European Commission in certain areas. Jean-Claude Juncker declared on Tuesday that at the present time there will not be a new draft presidency compromise: “the ultimate proposal” will be formulated at next week's summit. He pointed to a “favourable collective feeling” among finance ministers and called on them to demonstrate this with the different prime ministers (he would be able to do this without any effort..). Addressing the European Parliament in the name of the presidency, Nicolas Schmit explained the situation clearly (see bulletin 8963). The position of the Parliament itself, logically is less restrictive that that in Council discussions and was described at length in yesterday's bulletin. I'll be returning to it.
As for the second chapter in Juncker's strategy, better presentation of Europe, he will not be able to provide measurable results but the impression is that the European idea is currently being better explained. It's obviously a long term strategy.
Savings tax and other initiatives. There's also a third dimension: speeding up decision making on discussions that have sometimes been dragging on for a long time, and the launch of new initiatives. Although public opinion is difficult to gage, this acceleration appears to me to be obvious in some areas: energy policy; production of biofuels; war on funding of terrorism; space policy (which should “make Europeans dream”); port security; what else? From next July, savings income will be taxed at source in Member States that use “secret banking”, as well as in Switzerland, Monaco and elsewhere. The rate of this withholding tax is 15% to start with and will gradually increase to 35%, whereas these revenues currently benefit almost everywhere from a tax free system. The objective is an old one and developed in Jacques Delors' White Paper of 1993, pursued in tough negotiations by Mario Monti and finance ministers and then accepted by the Council on the condition that third countries do likewise. Switzerland proved a tough nut to crack. This is a significant European victory in the fight against tax evasion and a move towards better balance between income tax and capital gains taxation. But the echo among the public has been modest, as for the other projects mentioned. Readers of Europe have been duly informed about it but the resonance in the rest of the media has been rather limited. These are, however, measures that have been exclusively carried out at a European level and positive for citizens. Who's going to tell them about them?
(FR)