Europe may be ready for monetary union, but economic and monetary union is another matter. That, at least, was the subtext of the informal meeting of EU finance ministers here this weekend.

Attempts by the Austrian Presidency to hasten the pace of tax co-ordination between memberstates, notably on corporate tax, one of its presidency priorities, came to naught as did the search for a formula by which the euro countries could be collectively represented on bodies like the IMF and at informal gatherings like G7.

German hostility to the idea reflects a longstanding tussle with the French over the extent to which the European Central Bank needs a political/economic counterbalance.

Having been brow-beaten into accepting the establishment last December of the ministerial €11 committee, Bonn is doing its best to block any extension of its remit. A senior German finance official expressed satisfaction at the deadlock: "There was no consensus on additional representation to go to G7 so, as far as I'm concerned, that's how it can stay."

But ministers pledged to have another go at the issue ahead of their December meeting.

The Minister for Finance, Mr McCreevy, was one of those who led the charge against any further EU initiatives on corporate taxation. The Union had agreed, with some difficulty, he told fellow ministers, on a code of conduct and had established a review group to look at genuine cases of harmful tax competition. They should wait and see how that committee reported before contemplating any further moves.

Commission sources say that Ireland's 12.5 per cent regime from 2002 is likely to get a clean bill of health from the committee. Speaking to journalists later, Mr McCreevy denounced the ultimate logic of EU tax harmonisation as an attack on the democratic right of the citizen to vote for alternative economic models.

"It would mean that we would all have to subscribe to the same political views," he said. "That would undo democracy. I say it's illogical and anti-democratic."

And the ministers remained deadlocked on the rate at which to set a minimum withholding tax on non-resident bank deposits. Britain and Luxembourg accepted the principle of a tax or a system of reporting accounts to the accountholder's state of residence but say the proposed 20 per cent rate is too high. The Austrian Presidency set next June as a target date for resolving the difference. No progress was made on a long-standing environmental tax on energy consumption, with Mr McCreevy rejecting Austrian suggestions that the tax could be made more palatable by exempting households. "I find it difficult to see the logic of this approach," he told colleagues, "both on competitiveness grounds and because inefficiencies in energy use are more likely to be found in the private consumer area." Ministers agreed to the participation of both Denmark and Greece in the successor to the Exchange Rate Mechanism, the former with a fluctuation band of plus or minus 2.25 per cent, the latter with a band of plus or minus 15 per cent. Asked if Ministers discussed any constraints on those EU member-states which did not join the euro or ERM 2, Mr McCreevy insisted they had a treaty obligation to manage their economies in the common interest of the EU.

He also signalled there would be no free rides for Britain when it did decide to join the euro. Responding to questions about Ireland's potential veto on the rate at which sterling would join the single currency, Mr McCreevy made clear that he was well aware of that reality.

"If the euro proves an outstanding success," the Minister said, "those of us who went in at difficult times and took the heat might take a jaundiced view of others who waited to see if it would be a success. That doesn't seem very equitable to me and I'm not the only one who thinks so."

Ministers also took the opportunity to launch a discussion on the reform of the international financial institutions following initiatives from the French and British.

France has argued that, increasingly, financial institutions like the IMF are faced with political questions rather than technical monetary or economic ones. Whether or not to rescue a particular Indonesian regime is a question that requires political direction, they say, and have urged an increased role for the IMF's ministerial council; the subtext is that Paris believes the IMF is overly dominated by the US.

France has also urged a change in IMF rules to allow countries benefiting from IMF aid exceptionally to use capital controls during a crisis. Britain is pressing for a merger between the IMF and World Bank.

Ministers did agree that the single currency had already saved them from being swept up in the global financial crisis and resisted pressure from both inside and outside the bloc to seek lower interest rates from the European Central Bank.