Thursday, 20 January 2011

Open Europe

Europe

Open Europe Chairman Lord Leach: The European Union Bill urgently needs to be amended to give Parliament power over the steady mission creep of new EU laws

Writing on Conservative Home, Open Europe Chairman Lord Leach of Fairford sets out where the Government’s EU Bill needs to be amended to increase the power of Parliament and voters over EU affairs. MPs will debate the Bill in the House of Commons next week.

He argues that “With a handful of simple amendments to the ‘referendum lock’, the Government would in future be required to get approval from Parliament (and the people in significant cases) before it opts in to a new crime, policing or immigration law. Ireland operates a similar system, so it is difficult to understand why it would not work in the UK.”

“On existing legislation: the Government must decide by 2014 whether a whole raft of EU police and justice laws agreed before the ratification of the Lisbon Treaty (in 2009) including the European Arrest Warrant, will continue to apply in the UK. Under this arrangement, if the Government opts out of any one of the existing laws, it has to opt out of the entire lot. If it decides to continue unchanged, ultimate jurisdiction over these laws will for the first be transferred from the UK courts to the European Court of Justice in Luxembourg.”

“In other words, 2014 will see a clear, binary choice between radically more or radically less EU control over the British legal system. Somewhat extraordinarily, this is a decision for Ministers at the moment. The EU Bill must be amended so as to put this hugely important choice to the people – or at the very least Parliament.”

On the Spectator’s Coffee House blog, Open Europe Director Mats Persson argues: “The huge merit of attaching these provisions to the Bill is that in two simple brushstrokes, a large slug of EU laws would be brought back into the UK’s democratic orbit […] Then a robust and open debate, or politics as normal, can begin over the level of UK-EU cooperation on crime, justice and immigration – and let the strongest argument win. Tory, Lib Dem and Labour MP alike, who could object?

Conservative Home: Lord Leach Spectator: Persson Open Europe press release Open Europe briefing

National Audit Office says UK owes EU £1bn in fines;

Local councils may become liable for a further £1bn

The National Audit Office has set aside around £601m to pay future EU fines, in addition to £398 million of fines already paid, over the mismanagement of EU funds spent in the UK. Most of the fines relate to EU farm subsidy payments, but regional development funds also attracted “corrections”. Open Europe Director Mats Persson is quoted in the Telegraph saying, “Undoubtedly, the UK needs to tighten its checks on EU spending, but it’s also true that this money would be much easier to control if it wasn’t channelled via Brussels in the first place. The EU budget is hugely complex and irrational and therefore more prone to mismanagement than national spending programmes.”

Meanwhile, the FT notes that Council leaders have criticised plans by Eric Pickles, Communities Secretary, to make them liable for another set of fines resulting from new EU directives covering waste recycling, procurement and service delivery. Missed targets could see fines in excess of £1bn levied against the UK, the Local Government Authority warned. “If fines are levied councils will have no choice but to either cut services or pass the cost on to residents,” said Lady Eaton, Chairman of the LGA.

Telegraph Times FT Express

FT Deutschland reports that yesterday German Economy Minister Rainer Brüderle warned the European Commission against including sanctions on export surplus countries in plans for stronger economic governance of the eurozone. “We don't want our exports to be judged in Brussels,” he said.

No link

New Economic Advisor to German government calls for referendum to extend eurozone rescue fund;

Die Zeit: German government plans debt restructuring for Greece

In an interview with FAZ, Economic Advisor to the German government Lars Feld said: "When there is discussion on an extension of the €750bn bailout fund for eurozone member states with excessive debt, such an important question in the EU should be put to the people." In Handelsblatt he is quoted saying, “I don’t believe that Greece will manage to deal with its debts without a cut.” As a solution for the eurozone, he goes on to argue, “We must get rid of the bail-out schemes and go to orderly insolvencies”, adding that “the transition will be difficult”, but it is the only way for the monetary union not to become a transfer union. “I’m against Eurobonds. This will become very expensive for Germany. Also, it will give the wrong incentives for countries in crisis,” he adds.

Die Zeit reports that the German government is pushing through a new plan for restructuring Greek debt which could see Greece buying back its own bonds using EFSF allocated money at preferential interest rates. The German government has denied the claim.

FAZ reports that the parliamentary faction of the German government’s junior coalition partner, the FDP, unanimously rejected changes to the eurozone bail-out fund, the EFSF, saying: "Current and foreseeable refinancing needs can be covered by the fund as it is now.” FT Deutschland reports that German Chancellor Angela Merkel has proposed increasing the retirement age across the eurozone to 67 years old, in order to calm down fears in Berlin about the increasing cost of euro bail-outs for Germany.

Expansión reports that analysts have estimated that between €40bn and €50bn will be needed to recapitalise Spain’s savings banks – the cajas. The article notes that the cajas and listed banks are estimated to have €180bn of bad debt. Yesterday, Portugal succeeded in selling €750m in 12-month Treasury bills at lower than expected yields. However, Moody’s warned it could downgrade Portugal’s credit rating.

The Irish Times reports that the Commission supports proposals to cut the interest rate on EU rescue loans. Irish MEP Joe Higgins yesterday accused the EU of "making vassals" of Irish taxpayers.

OE blog RP FT Deutschland Handelsblatt Die Zeit FT FT 2 ABC El Pais WSJ WSJ Reuters FAZ FAZ 2 Bloomberg Handelsblatt FAZ Handelsblatt Irish Independent Irish Times Irish Independent 2 IHT Die Zeit Reuters Les Echos Irish Times Irish Times Expansion Irish Independent: Keenan Irish Independent: Oliver WSJ: Smith El Pais: Cavallo

Last week's Open Europe seminar with Professor Markus Kerber in Brussels continues to receive coverage and is featured by Belgian newspapers De Morgen and De Tijd. Professor Kerber is quoted saying that “pumping billions of euros of taxpayers’ money into the system can’t work because construction errors in the system prevent this.”

Tijd OE events

MEPs approve EU’s cross-border health plans

The BBC reports that MEPs have approved the EU’s Cross-Border Health Directive, designed to make it easier for patients to seek treatment in another EU member state. Under the new rules, patients seeking hospitalisation for more than 24 hours in another member state will need to get prior agreement from their national health services. Patients will only be reimbursed at home-country rates; so if a treatment costs more in another country the patient will have to pay the difference. National governments are yet to approve the Directive.

BBC EUobserver Euractiv Mail

New EU macro-prudential supervisor could not be able to prevent future crises

Bloomberg reports that economists are questioning the ability of the European Systemic Risk Board – the new pan-EU financial watchdog in charge of macro-prudential supervision – to prevent future financial crises. Carsten Brzezski from ING is quoted saying: “If you’re looking for an institution that will save us from the next crisis, this is certainly not it […] It’s just another talking shop.”

Meanwhile, FT Deutschland quotes Eurozone Chief Economist at Citigroup Jörg Michels warning that the ECB’s leading role in the ESRB could trigger a “medium term conflict of interest between price and financial stability.

Bloomberg FT Deutschland OE research

The FT reports that European insurers envisage difficulties in meeting some of the deadlines for the implementation of the EU’s Solvency II Directive, which radically overhauls regulation of the insurance sector in Europe.

FT

In a comment piece in FAZ, columnist Stefan Ruhkamp looks at the ECB’s “inflation dilemma” and argues that the combination of support for weak banks and an effective anti-inflation policy is impossible to achieve. He concludes: “Playing the role of the saviour has critically limited the ECB’s scope; it will only recover it once the extraordinary rescue measures have ended.”
FAZ Coulisses de Bruxelles FT Deutschland

Handelsblatt reports that Standard & Poor’s has warned that EU plans to reform rules governing credit rating agencies will leave the door open for greater political influence on the rating of government bonds.

Handelsblatt

Le Figaro reports on a survey conducted by TNS Opinion, showing that only 48% of young people across Europe believe that the European project plays a role in the construction of their identity.

No link

An editorial in the WSJ questions the usefulness of the EU’s Galileo satellite system and argues: “It was no shock in 2008 when the private companies that had originally signed up to invest in Galileo pulled out. European taxpayers, on the other hand, do not have that option. They are still stuck footing the entire bill – whatever it turns out to be.”

WSJ: Editorial OE research OE blog

Hungarian Prime Minister Viktor Orban confronted critics in the European Parliament yesterday, warning the EU not to meddle in his economic policies and a new media law as his country takes on the rotating Presidency of the EU.

WSJ Times El Pais ABC EUobserver Euractiv

EUobserver reports that a series of hacking attacks on national registries where carbon permits are stored has forced the closure of the EU's Emissions Trading System (ETS) for at least one week.

EUobserver Euractiv Telegraph Times FT FT 2

European Voice reports that EU Internal Market Commissioner Michel Barnier will unveil a green paper next week paving the way for an overhaul of EU rules on public procurement.

European Voice

EU Transport Commissioner Siim Kallas said the EU was considering introducing regulations that would require European airports to upgrade their systems to avert the kind of weather-related shutdowns that caused travel chaos in most of Europe last month, adding that airlines should be eligible for compensation if hubs do not meet industry standards, reports the FT.

FT ABC

UK

Prime Minister David Cameron is hosting nine leaders from Nordic and Baltic countries for a “free-thinking exchange of ideas” at a two-day summit in London. The Express has a feature on the Nordic model, quoting Open Europe Director Mats Persson saying that it will be difficult for the UK to copy the Swedish model in full.

Express