Open Europe press summary: 11 June 2010

Europe
 
Van Rompuy admits €750bn eurozone aid package may not be enough;
FT Deutschland: Eurozone braced for Spanish bankruptcy
The front page of FT Deutschland carries the headline: "the EU is getting ready for a Spanish bankruptcy". According to information obtained by the newspaper, eurozone member states are calculating the cost of emergency aid to Spain if problems in the country's banking sector escalate. European Council President Herman Van Rompuy has also fuelled speculation that the cost of eurozone bailouts may rise further, saying yesterday that one could "of course imagine it exceeding the €750 billion" already outlined. City AM notes that business confidence continues to be hit by eurozone fears.
FTD Handelsblatt Telegraph 2 CityAM FT
 
Angela Merkel revives calls for EU treaty change;
Van Rompuy rejects French calls for eurozone 'economic government'
Following a meeting with EU President Herman Van Rompuy in Berlin yesterday, Chancellor Angela Merkel has repeated her desire to change the EU treaties in order to strengthen the EU's rules on economic governance. The Irish Independent quotes her saying, "I am of the opinion that we need a change of the treaties", adding, "I believe that such a Treaty change could bring certainty to the markets", according to Handelsblatt. President Van Rompuy said, "Our priority is to work within the framework of the treaties", but said that "there is no taboo to speak about treaty changes" if necessary.
 
Van Rompuy also rejected French calls for an 'economic government' or secretariat of eurozone members, saying: "We do not need new institutions to meet our goals. We need more effectiveness". A headline in FTD reads: "Merkel isolates Sarkozy in the Euro debate". DPA reports that Van Rompuy wants to prevent the disagreements on this question between Paris and Berlin getting out of hand, and quotes him saying: "we should in no case allow these debates to escalate too much."
 
Le Monde reports that Commission President Jose Manuel Barroso has also indicated his opposition to President Sarkozy's proposal, saying: "We will not reinforce the Stability and Growth Pact by diminishing the credibility of the Community institutions and the Community method...New institutions would do that [by] creating a new confusion".
 
EU leaders are set to discuss an interim report from Van Rompuy's economic taskforce on issues of economic governance and increased EU surveillance of national budgets at next Thursday's European Council meeting. European Voice reports that ECB President Jean-Claude Trichet has said that it is "extremely important" for the EU to make a "quantum leap" in its economic governance, and that this applied "for Europe as whole, but particularly for the euro area". At a press conference with Italian PM Silvio Berlusconi and his Spanish counterpart José Luis Rodríguez Zapatero yesterday, the latter reiterated that "Economic policy is not a national, but a European affair".
 
Le Figaro reports that the EU wants to have surveillance on national budgets in place by 1 January 2011, and quotes EU Monetary Affairs Commissioner Olli Rehn saying: "The heart of the mechanism has to be in place at the start of next year."
 
Meanwhile, Handelsblatt has seen draft conclusions for next week's European Council and reports that an agreement has been reached on the EU's 2020 growth strategy. Final details on economic governance and reform of the stability and growth pact have not yet been finalised, as there is no consensus yet, according to an EU diplomatic source.
Irish Independent Le Monde AP Reuters Les Echos DPA EUobserver DPA European Voice Le Figaro BBC: Today programme Yahoo DT Tagesschau AD Telegraph Sueddeutsche Handelsblatt
 
NAO blames "sheer complexity" of EU funding schemes for continuing errors in budget spending
PA reports that the National Audit Office today blamed the "sheer complexity" of EU funding schemes for the continuing catalogue of errors in the handling of billions of pounds of the EU budget every year. The report said, "There remain seemingly intractable problems with reducing the high levels of error in some significant areas of EU spending."
 
The Head of the NAO, Amyas Morse, said "Weaknesses in the administration of European schemes in the UK, such as the Single Payment Scheme (for farmers), continue to have an impact on the taxpayer." He added "I welcome the signs of improvement in financial management of European funds across the EU but the persisting high levels of error are explained by the sheer complexity of these programmes. UK departments should press for programmes to be designed with clear measurable objectives and in such a way as to promote efficient administration."
NAO press release EUobserver: Persson
 
Treasury Minister Justine Greening wants a "cash freeze" on the EU budget
The Times reports that Justine Greening, Treasury Minister, will tell fellow EU ministers that Britain will not pay a penny more towards the EU budget. She said, "We mean a cash freeze. In cash terms there will be no increase to the EU budget. We are in the worst mess. It is just not tenable for us to increase the EU budget when we are hard at work trying to cut costs. We want the budget to be frozen."
Times
 
Hague and Clegg "united" in opposing EU plans for national budget oversight
On his BBC blog, Gavin Hewitt reports that, on their joint visit to Berlin, William Hague and Nick Clegg both rejected the EU proposal to submit budget assumptions to EU officials before they were presented to the UK Parliament. Hague said, "Our budget will be presented first to our national Parliament." Clegg added, "We are completely united on this." The Guardian notes that Clegg also warned against knee-jerk financial regulation, saying, "Regulatory overreaction...may unwittingly penalise part of the financial services system which was not responsible." In the Times, Roger Boyes comments that Nick Clegg's German language skills impressed German Foreign Minister Guido Westerwelle.
Guardian Times: Boyes BBC: Hewitt's blog
 
ECB President refuses to give details of controversial government bond purchases
The WSJ notes that despite the ECB's unprecedented move to buy €40 billion in government bonds, which has been attacked by Bundesbank chief Axel Weber, the Bank's President, Jean-Claude Trichet, has declined to provide details on which countries' debt the ECB is buying, how much it plans to purchase, what maturities it is targeting or what type of market signals officials will gauge to determine when the program is no longer required.
 
The Irish Times quotes Trichet saying, "The purpose has been very clearly said and we think that we give enough information at this stage." The article notes that Trichet also implicitly rebuked Weber for making public his opposition to the manoeuvre. "There is one currency. There is one ECB. There is one governing council and...there is only one decision," he said. The FT reports that ECB is also to extend emergency liquidity to aid the eurozone's banking system.
WSJ Guardian Independent IHT FT Irish Times BBC Telegraph
 
Bronwen Maddox: Election results signal "the Dutch are united in finding the burdens of EU membership very uncomfortable"
The Guardian notes that the two parties with the largest gains in the Dutch elections, Geert Wilders' PVV and Mark Rutte's VVD, are both highly critical of the EU. In the Times, Bronwen Maddox writes, "the confusion of the result sends a very clear signal: the Dutch are united in finding the burdens of EU membership very uncomfortable. That message, from a country at the heart of the eurozone, is one that EU members need to hear."
Guardian Independent Times Telegraph FT FT: Leader Le Monde BBC: Hewitt blog Irish Times Times: Maddox Open Europe blog
 
European Ombudsman suggests "excessive bureaucracy" at root of Commission's late payments to contractors
Euractiv reports that the European Commission has been criticised by the European Ombudsman for its failure to pay its contractors on time, despite tackling late payments being a political priority and a central plank of the EU's Small Business Act launched in 2008. "Late payments may well constitute a systemic problem in the Commission. The contributions submitted specifically stress a lack of coordination and excessive bureaucracy in the Commission as reasons for delays," said European Ombudsman P. Nikiforos Diamandouros.
EurActiv
 
Huhne to push for tougher EU emissions targets despite Commission's reluctance
PA reports that Energy and Climate Change Secretary Chris Huhne will today urge the EU to unilaterally up its emissions reduction target for CO2 from 20% to 30% by 2020. EU Environment Commissioner Connie Hedegaard says the time is not yet right for Europe to move to a 30% target as does the CBI. However, Huhne said, "I'll be using my first meeting to make clear the new UK Government's support for ambitious European action on climate change, including a 30% cut in EU emissions." He added, "We can't just click our fingers and hope the rest of the world will follow."
No link
 
Hague: Iran sanctions a test of the EU's "weight in the world"
The FT reports that Britain, France and Germany will encourage their European Union partners next week to join them in imposing fresh sanctions on Iran to halt what they see as Tehran's drive to acquire nuclear weapons. Writing in the Times, Foreign Secretary William Hague argues, "Reinforcing UN sanctions will be an important test of European resolve and a positive example of how the EU's collective political and economic weight in the world."
FT Times: Hague
 
MEPs say no agreement on EEAS before next week's summit
According to EUobserver, MEPs say a political agreement on the European External Action Service (EEAS) will not be reached before the European Council summit next week. "The parliament believes that in these times of increasing intergovernmentalism it is of the utmost importance to ensure that community policies are not intergovernmentalised," the assembly said in a statement.
EUobserver
 
The Mail notes that, in its final spending round, the outgoing Labour Government contributed around £1.6 billion to the EU's aid programme, despite the UK already having its own Department for International Development (DfID).
Mail
 
Writing in the WSJ, Stephen Fidler argues that some Commission officials are anticipating a "downside" to pressure from France and Germany to speed up legislation on credit default swaps, and other financial regulation, because "Legislation hurriedly drafted often turns out to be badly drafted".
WSJ: Fidler
 
Writing on Conservative Home former MP and Shadow Chief Secretary to the Treasury Howard Flight argues that "At the heart of the EU is the philosophy of the 'control state', believing that making rules for every aspect of citizens' and business' behaviour is a good thing, while ignoring the economic damage this can inflict.  There can be no UK economic renaissance under such a control regime."
Conservative Home: Flight
 
The Telegraph reports on increasing tension within the ruling German coalition, with the Free Democrats describing the CSU as a "wild sow" for their input into a debate on health care, and the CSU responding by calling their partners "Gurkentruppe", or "Cucumber troops", meaning a 'bunch of idiots.'
Telegraph
 
Writing in the FT, Gillian Tett argues that "Europe's antipathy to stress tests [for banks] is well founded" as she notes that "some eurozone officials fear they would spark market turmoil if stress tests revealed that individual banks were short of capital."
Handelsblat FT: Tett
 
EUobserver reports that the European Commission is close to finalising a new bank data transfer deal with the US for anti-terrorism purposes, but the article notes that MEPs are still unconvinced by the safeguards for citizens' privacy.
EUobserver EurActiv European Voice
 
MEPs on the civil liberties committee yesterday approved draft rules that set common standards on the right to interpretation and translation in criminal cases across the EU.
European Voice
 
Spain is drawing up new proposals for lifting Israel's blockade of the Gaza Strip, to be presented to EU partners by the Spanish Foreign Minister next Monday.
Guardian Guardian: Patten
 
 

---

Open Europe is an independent think tank campaigning for radical reform of the EU. For information on our research, events and other activities, please visit our website: openeurope.org.uk or call us on 0207 197 2333.