CC / Flickr - BY-NC-ND 2.0 - Number 10
TODAY’S MEETING of European leaders in Brussels is going to be a bumpy one. Last month, French President Nicolas Sarkozy had a “violent” row with Commission President José Manuel Barroso – an encounter that no-doubt soured relations between France and the Commission (indeed, tempers have recently threatened to flare up again). The controversial issue of treaty reform is not officially on the agenda (PDF), but this will most certainly be the biggest battle of the day. There is, however, also the contentious issue of a rise in the EU’s budget to be discussed.
Van Rompuy will present the findings of his taskforce on EU economic governance (which – as I wrote about earlier – are more subtle than widely reported). It’s not entirely true to say that the recommendations have been “watered-down” by Franco-German interference. Yes, the “corrective” part of the new rules will be “semi-automatic” (i.e. sanctions will apply unless overturned by qualified majority in the Council), but the earlier – and, arguably, more important – “preventative” part of the pact will still be automatic (and sanctions can be applied in as little as three months for the most serious cases).
As for treaty reform, various options are on the table. Cameron will probably be able to avoid calling a referendum in Britain because the UK has an opt-out from the sanctions regime. However, Ireland will be under great pressure to put any changes to the public first. Therefore, some are suggesting reform could be sneaked into the treaties via technical obfuscation (so-called “treaty change-lite”). This would avoid the need for referenda, but might also force Germany to abandon some of her more extreme demands (such as the suspension of voting rights for those states that break the rules).
The second storm-front (also not officially on the agenda) involves next year’s proposed EU budget hike of 6%. David Cameron has vowed to “freeze or cut” the budget, but he needs the support of a majority of the Council to make this happen. The Financial Times is predicting failure for Mr. Cameron – with a possible compromise solution of a 2.9% budget increase. The BBC’s Gavin Hewitt thinks this could even be negotiated down to “just over 2%” – which might satisfy Cameron (but probably not the Tory’s growing eurosceptic wing).
There are suggestions that Cameron might use UK support for treaty reform as a bargaining chip to achieve his objectives on the budget. Personally, I agree with the FT – Cameron will be unable to “freeze or cut” the budget, but might be able to settle with a halving of the proposed budget increase (not an insignificant achievement). This wouldn’t necessarily be the end of the story, however, as a joint-text would then need to be decided with the Parliament and – ultimately – a higher figure than the one proposed by the Council might have to be negotiated.
As for German plans for treaty change – the most likely outcome is that Van Rompuy will be asked to form another taskforce and come back next year with a proposal that satisfies some of Merkel’s demands but that doesn’t require national referenda to implement. Nobody will be entirely satisfied, but that’s what EU politics is all about: compromise, compromise, compromise.