| Open Europe |
| Fortnightly Open Europe Bulletin: 7 May 2010 |
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| Quote of the fortnight:
"European monetary union was a political project imposed on unenthusiastic electorates by political leaders in a hurry. However, it was based on some very bad economics and ultimately bad economics leads to bad politics which we are beginning to see."
Labour MP Gisela Stuart writing in Die Welt, 6 May 2010 |
| 1. UK elections: Potential Conservative/Lib Dem coalition must not undercut EU reform |
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The General Election in the UK has resulted in a hung Parliament. Both Gordon Brown and David Cameron have extended an offer to the Lib Dems to begin talks to see whether some sort of coalition, however loose, could be agreed upon to form a Government. However, Nick Clegg has said that it is for the Conservatives, as the largest party, to try and form a workable majority first.
Speaking earlier today David Cameron laid out the areas that the Conservatives would be unwilling to compromise on in any potential coalition. These included their election pledges on immigration, defence and the commitment that "[no] government should give more powers to the European union". According to reports, Mr Clegg and Mr Cameron have already spoken this afternoon, regarding options for co-operation between their parties. There has also been speculation that senior members from the Lib Dems could be offered roles in a Conservative-led government in return for their party's support.
While electoral reform and the economic recovery will be the key issues, the EU is clearly a dividing line between the Lib-Dems and the Conservatives, with Nick Clegg still committed to joining the euro in the long-term, favouring a common EU immigration policy and calling for further integration in justice and home affairs. Should the two parties agree to a coalition arrangement, the Conservatives could find it more difficult to push through some of their key policy pledges on Europe . In particular, the Conservatives might fail to get support in Parliament for their flagship policy of a 'referendum-lock' - a law that would require every future transfer of power to the EU to be subject to a referendum in the UK .
The Conservatives and the Lib Dems could also clash on whether the UK should opt in to the EU's growing number of initiatives in immigration, policing and security policy. Over the next five years, there are a range of key decisions a UK government must take in justice and home affairs, as the Lisbon Treaty accelerates EU integration in this area. Ambitions to opt out of some parts of EU employment law could also be complicated by a Lib Dem/Conservative arrangement.
Other key areas, such as the upcoming negotiations on financial services legislation (in particular the AIFM Directive) and talks on the EU budget, will not necessarily be profoundly affected by a coalition arrangement, since all three main parties tend to broadly agree on substance (although perhaps not on strategy and tone).
It's clear that the Lib Dems are out of step with the British public on the EU. In the context of a crumbling eurozone and the mood of disenchantment with the EU around the continent, the potential for a determined British Government to push for radical reform in Europe is stronger now than at any time in recent history. Quite apart from the possible merits of a coalition in other areas, it would be most unfortunate if the Conservatives allowed a coalition with the Lib Dems to make them complacent on Europe , and miss this opportunity for wholesale EU reform.
To read Open Europe's briefing on the main parties' policies on Europe , click here: http://openeurope.org.uk/research/europeandelections.pdf
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| 2. Eurozone leaders mull giving EU more economic powers following agreement on €110bn Greek bailout |
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Eurozone leaders last weekend finally agreed on a bailout package for Greece of €110bn over three years, which it is hoped will be in place by the time a debt repayment is due on 19 May. €80bn of that will consist of loans from other eurozone members, and €30bn from the IMF. (Telegraph, Guardian, FT 3 May)
The German Bundestag today approved the German contribution of €22.4bn to the Greek bailout package, spread over three years. German Chancellor Angela Merkel told MPs before the vote: "We are at a crossroads. What is at stake is no more or less than the future of Europe." The Greek Parliament yesterday approved a package of austerity measures, amid scenes of social unrest on the streets of Athens, in exchange for the bailout. (ARD, BBC, 7 May)
Although the package is set at €110bn, speculation has suggested that it may increase over the next 2 years, with German Deputy Finance Minister Steffen Kampeter saying that Greece might need a figure closer to €150 billion. (Stern, 29 April; Le Figaro, 5 May)
Eurozone leaders meet today to discuss proposals to give the EU more powers over economic policy, including giving eurozone finance ministers the mandate to approve national budgets in the eurozone through a majority vote. Other ideas include introducing sanctions, such as the withholding of EU funds, for countries that break EU debt and deficit rules, as well as a central fund, which would serve as a lender of last resort in case eurozone countries needed to be bailed out. Proposals are also floating around for new EU rules setting out how individual member states can go through a controlled default in future. The Commission will present new proposals on these issues on 12 May. (European Voice, 29 April)
Ahead of that meeting French President Nicolas Sarkozy and German Chancellor Angela Merkel wrote in a letter to Commission President Jose Manuel Barroso: "For economic and monetary union to remain a success story, dealing with this crisis alone will not suffice...This implies that we reinforce the co-ordination of our economic policies and the internal surveillance mechanism of the euro area so that each country shares responsibility for the stability of the euro." (EUobserver, 7 May)
Please leave your comments on our blog here: http://openeuropeblog.blogspot.com/2010/05/truth-about-emu-conditions.html
or here: http://openeuropeblog.blogspot.com/2010/04/flip-flopping-clegg.html
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| 3. News in brief |
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Nick Clegg made €362,550 profit on his Brussels home while receiving Brussels accommodation allowances. Official documents obtained by Open Europe show that Lib Dem leader Nick Clegg made a profit of €362,550 on the sale of his home in Brussels he bought while receiving thousands of pounds in accommodation allowances as an MEP.
During his time as an MEP and Commission official Mr Clegg could have received a total of up to €278,346 in allowances meant to cover living and housing costs in Brussels and Strasbourg - of this amount €110,000 could have been claimed in daily accommodation allowance between 2001 and 2004, specifically for the time he spent in Brussels (excluding the days he could have spent in Strasbourg) when he was an MEP and owner of the house. (Times FT Guardian Sun Sun: Leader Mail, 28 April)
European Parliament changes rules to maintain use of chauffeured limo for former President. It has been revealed that the Secretary General of the European Parliament, Klaus Welle, changed EU rules last November solely to allow former EP President Hans-Gert Pöttering to keep his limousine with a driver on call. Under the previous rules Mr Pöttering should have returned his limousine in October, three months after the appointment of the new President, but Mr Welle changed the rules to assist his former boss. (Spiegel, 4 May)
Commission proposes 6% budget increase. The European Commission has proposed a budget for 2011 of €130 billion - an increase of almost 6 percent on this year's budget, despite huge spending cuts by virtually every member state government. The draft budget still has to be agreed by EU member states and approved by the European Parliament. The UK's contribution would rise by £450 million if the increase went ahead. (EUobserver, 28 April; Mail, 29 April)
Daughter of the former Bulgarian Agriculture Minister is country's biggest recipient of EU farm aid. A new study by the NGO Farmsubsidy.org has revealed that the daughter of a former Bulgarian Agriculture Minister, Dimitar Peichev, has received €700,000 of EU Common Agricultural Policy (CAP) subsidies, making her Bulgaria's largest single beneficiary. Until July 2009, Mr Peischev was responsible for the handling of EU funds. Details of other farming subsidy receipients included €59,585 for a Swedish accordion club and €98,864 for the Netherlands' Schipol airport. (EUobserver, 5 May)
Platini to try and convince Commission to introduce new EU "police for sport". Now that the EU has competence in the area of sport for the first time, under the Lisbon Treaty, the UEFA President, Michel Platini, has said he wants to speak to the Commission about raising the minimum age for international football transfers from 16 to 18. He said: "I have to prove to the European Commission that, for sport, 18 is a better age than 16. We have to fight on that -- for education, for social reasons. Perhaps I won't succeed with this, but I'm very proud to be trying to do this. It's important". Platini also said that he wanted support from all EU countries to "protect the game", adding: "It's difficult to have a European Police, but if we could have a European Police for Sport, it would be very good." (28 April, Times OE blog) |
| 4. Open Europe in the news |
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Nick Clegg made €362,550 profit on his Brussels home while receiving Brussels accommodation allowances 30 April Nieuwsblad 29 April Express 28 April Times FT Guardian Sun Express Mail 27 April Sky News BBC London
Open Europe's findings that Lib Dem leader Nick Clegg made a profit of €362,550 on the sale of his home in Brussels he bought while receiving thousands of pounds in accommodation allowances as an MEP received coverage in the Times, Express, Guardian, Sun, Mail, page 2 of the FT, in Belgian daily Het Nieuwsblad and was featured on Sky News and BBC London.
Open Europe Director Mats Persson was quoted in the Sun saying: "Nick Clegg has taken the moral high ground in this campaign. But now he needs to come clean on whether he used taxpayers' money in any way to make a huge personal profit on his house in Brussels. Failure to do so would amount to extraordinary hypocrisy as he's been the most outspoken against MPs who have used public money to make personal gains in the property market."
Open Europe was also quoted in the Mail saying: "It is unacceptable to simply hide behind the opaque EU allowances system, which doesn't require MEPs or officials to provide receipts for their allowances."
Greece wouldn't find it easy to leave the euro 30 April Guardian: Elliott BBC Oxford
Writing in the Guardian Larry Elliot looked at whether Greece could or should leave the eurozone, and quoted Open Europe Director Mats Persson saying: "There is no mechanism on the table [for leaving the euro] at all. They haven't thought about it." He added that, in the long-term "an alternative would be for the eurozone to split into a German-led inner core and an outer core made of a weaker group of countries, which would not include Greece." Mats also appeared on BBC Oxford radio, arguing that the case for the UK joining the euro was "getting weaker by the day". |
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