GERMAN CHANCELLOR Angela Merkel gained support in her drive for the creation of a permanent rescue fund for euro countries but she faces mounting opposition to her push to strip voting rights from countries that breach EU budget limits.
As EU leaders gathered last evening for their autumn summit in Brussels, they were poised to give European Council president Herman Van Rompuy a clear mandate to examine changes to the EU treaties to fortify Europe’s economic system.
Although many leaders moved towards Dr Merkel to express support for the notion of a permanent rescue fund to replace the ad hoc measures in place since May, it was clear that the chancellor was making little progress in her effort to persuade her counterparts to back the suspension of voting rights.
The shift in support for narrow treaty change reflects the widely held view that Dr Merkel is determined to pursue this line and will not accept anything less. Although many say her push for the suspension of voting rights is doomed, diplomats believe it is very unlikely that she would back down at this point from any of her key demands.
European Commission chief José Manuel Barroso, making public for the first time his resistance to the German demand to suspend voting rights, said the summit should not put process ahead of substance.
“If treaty change is to reduce the rights of member states on voting, I find it unacceptable and frankly speaking it is not realistic,” he said. “It is not compatible with the idea of limited treaty change and it will never be accepted by the unanimity of member states. And as you know a treaty change requires unanimity.”
Mr Barroso’s forthright remarks were widely seen to reflect frustration around the EU with the stance adopted by Dr Merkel, whose sole ally of note on this question is French president Nicolas Sarkozy.
He said, however, the summit would have to discuss proposals “if treaty change is to address the issue of the economic and financial crisis response”.
Berlin and Paris formed a new alliance last week, forcing European finance ministers to water down new financial sanctions on rule-breakers in proposals that Mr Van Rompuy was bringing to EU leaders for their endorsement at the summit.
A further political battle is in store, however, as the new rules must be agreed by the European Parliament in a co-decision process and many MEPs say the current proposals are too weak.
The Van Rompuy report highlights a number of areas that require further work, among them the question of making permanent the temporary support measures introduced in May.
Although many countries believe no amendments are required for a permanent rescue fund, countries such as Finland, Greece, Sweden, Poland and Slovakia expressed guarded support for limited treaty amendments.
“The euro area needs a credible permanent crisis mechanism to ensure the financial stability of the euro area as a whole,” said Finnish prime minister Mari Kiviniemi after a meeting of liberal leaders which was attended by Taoiseach Brian Cowen.
Ms Kiviniemi’s remarks marked a change of stance as she opposed such moves earlier this week.
“If this new system requires treaty change, then treaty change should be done.”
Danish prime minister Lars Loekke Rasmussen said the idea of suspending voting rights was “very political” and “very controversial”, adding that he could not support it. “We don’t like the idea of any kind of treaty change. We have just ratified the Lisbon Treaty and to start a new process, that would be rather difficult.”
Other opponents of the suspension of voting rights include Greek prime minister George Papandreou. “We are opposed to the discussion over the removal of voting rights,” he said.
THE SIMPLIFIED REVISION PROCEDURE HOW IT WORKS
Under discussion as EU leaders debate possible changes to the EU treaties is a provision in the Lisbon Treaty which allows for “simplified” revision of the document if the change does not have the impact of increasing the EU’s competences.
The procedure – which is set out in Section 6 of Article 48 in the Lisbon Treaty — relates to the “internal policies and action” of the union. It allows the EU member states to unanimously adopt a decision amending all or part of the main elements of the Treaty on the Functioning of the EU, which governs how the union carries out its work.
To do this the European Council must first consult the European Parliament, the European Commission and, in cases involving institutional change in the euro area, the European Central Bank.
Deploying this provision would avoid the necessity to convene a constitutional convention.
Any decision taken under this procedure cannot enter force until it is approved by member states in accordance with their respective constitutional requirements.
ARTHUR BEESLEY
