Thursday, October 14, 2010

Open Europe press summary: 14 October 2010


Treasury Minister says Britain will demand "cash freeze" to EU 2011 budget
MPs debated the EU's 2011 budget in Parliament last night, with Economic Secretary to the Treasury Justine Greening saying that the Government would be looking for a "cash freeze" in upcoming negotiations with other member states and the European Parliament. She added that "It is simply no longer tenable" for the EU budget to continue rising while national governments are being forced to reduce spending. The Commission is calling for nearly a 6% rise, which Ms Greening said had "no justification", but MEPs may ask for even more.

An amendment by Conservative MP Douglas Carswell, calling for a reduction in how much the UK gives to the EU, was defeated by 252 votes to 42. However, Ms Greening said the Government accepted an amendment by fellow Conservative MP Bill Cash, Chairman of the Commons European Scrutiny Committee, calling on the Government "to reject European Parliament proposals to increase the budget".

If the negotiations lead to deadlock, national governments, the Commission and the EP will have 21 days to reach a compromise. If a deal still can't be reached, the budget remains the same as last year. The UK has no veto over the annual budget.
Telegraph Mirror Mirror 2 BBC: Hewitt's blog Conservative Home John Redwood's Diary Wales Online Spectator: Coffee House blog

250 MEPs and their staff take £350,000 "study break" in five-star Madeira
The Telegraph reports that 250 MEPs, 80 parliamentary assistants and 70 civil servants working for the European People's Party (EPP) in the European Parliament have taken a three-day "study break" at the holiday resort of Madeira at a cost to the taxpayer of up to £350,000. Rooms have been reserved at two five-star hotels on the island, the Pestana Carlton and the Pestana Casino. The formal programme includes a debate on controversial plans by MEPs to increase the EU budget for 2011.

Each new job in Wales costs £68,000 under EU spending scheme
Wales Online reports that official figures published on the Welsh European Funding Office (WEFO) website show that £286.3 million of EU money designed to create new jobs has been spent over the seven-year period to 2013. WEFO - part of the Assembly Government - claims to have created 4,187 jobs over the same period, making each job equate to a spend of £68,378.Wales Online

Van Rompuy used official EU cars to drive his family to Paris
EUobserver reports that European Council President Herman Van Rompuy used EU official cars to drive himself and nine members of his family from Brussels to Paris during his summer holidays. Van Rompuy's spokesman Dirk De Backer has confirmed that the trip actually took place in a "protected car", but added: "Just because the President goes on holiday does not mean he is no longer the President, requiring the same level of protection".

Commission considers a "passport" for auditing firms
EU Internal Market Commissioner Michel Barnier announced yesterday that the EU could introduce legislation in 2011 to regulate auditing firms, reports the IHT. Barnier noted that the 'big four' Anglo-Saxon auditors currently control 70% of the European market, and 99% of the UK. "We think that this sort of concentration can lead to systemic risk [...] The status quo is not an option", he said. El Pais reports that one of the options being considered is the introduction of a European "passport" for auditors. City AM reports that, according to KPMG auditing firm, "market interventions, such as reducing the scale of the existing firms, would be prejudicial to audit quality".

Dow Jones reports that talks over the AIFM Directive broke down last night over disagreements about how much power the new European Securities and Markets Authority would get in granting market access to funds based outside the EU. 

A draft Commission paper on the reform of the EU's Common Agricultural Policy post 2013 suggests various changes including: linking farm subsidies to environmental protection, a cap for direct aid to farmers and evening out payments across the EU. Direct aid and export subsidies will be maintained, reports European Voice.

FAZ reports that the European Commission is considering reviewing the code of conduct for former Commissioners before the end of the year. The article notes that the overhaul will not involve the introduction of stricter rules, but will merely clarify the existing ones. Meanwhile, Polish daily Rzeczpospolita quotes Open Europe's estimates showing that Commission President José Manuel Barroso earns $400,000 per year - as much as US President Barack Obama.

The Irish Times reports that EU transport ministers will discuss tomorrow proposals to impose extra tolls for pollution and noise on Heavy Good's Vehicles.

European Voice reports that MEPs are dividing along national lines over new rules on maternity leave and pay. MEPs will next week vote on an amendment calling for the extension of women's basic entitlement to maternity leave from 14 to 20 weeks across the EU, which would cost the UK an extra £2.4bn.

The Guardian notes that a report due to be published soon by Policy Exchange shows that carbon emissions generated to produce imported goods and services consumed by EU member states have increased by 40%. These findings are in sharp contrast with a previous report by the European Environment Agency claiming that emissions in the EU-27 decreased by more than 17% since 1990.

The Irish Times reports that 180 MEPs have called for the cancellation of the second week of European Parliament's sittings in Strasbourg in September. The move would save €15 million and an estimated 1,600 tonnes in carbon emissions.

Writing in Le Figaro, Jacques de Laroisière - who authored the report on the reform of financial supervision in the EU in 2009 - says that the new rules on capital requirements agreed by the Basel Committee in September will harm the "European" banking model more than the "Anglo-Saxon" one. He suggests that a growing number of banks will be encouraged to engage into riskier investment activities to boost their liquidity rather than lending more to small and medium enterprises., which provides online monitoring and analysis of the European Parliament's voting data, has called for all voting by MEPs, whether in plenary or in committees, to be recorded and made public.

An editorial in the WSJ argues that the EU's proposed deposit guarantee scheme, which would lock national guarantee funds into bailing each other out, "internationalises existing national risks".

The FT reports that the UK faces a clash with the Commission after backing a call by manufacturers for a 12-month delay on implementing parts of the EU's REACH Directive, governing the use of industrial chemicals.

Supply Management reports that local councils could run against EU procurement laws if they transfer contracts from a bankrupt supplier without a full tendering process. Norwich County Council has argued that this shows how procurement regulation can be "rather inflexible".


The Irish Independent reports that the Vatican City could face a €9 billion tax bill if the Commission probes that tax breaks conceded to the Holy See by the Italian government are in breach of EU competition rules.

The Irish Independent reports that Austrian Central Bank Chief Ewald Nowotny has contradicted Bundesbank Chief Axel Weber defending the ECB's bond buying measures. "My personal view would be that it makes sense to use [bond purchases] as a safety belt [...] I would not throw it away too early", he argued.

In an interview with Le Figaro, Finnish Prime Minister Mari Kiviniemi has said that the proposed sanctions for eurozone countries in breach of the Stability and Growth Pact should be "as automatic as possible". 

A leader in the Spectator analyses recent strikes in France and argues: "There is still a delusional belief that France can hide behind a protectionist wall, have the EU slap tariffs on Chinese imports and pretend globalisation isn't happening".

The Guardian reports that the UK is pressing MEPs to endorse proposals to grant Pakistan privileged trade access to EU markets to help the country recover from the recent flood disaster.

The Commission backed away from imposing a moratorium on deep-water oil drilling in European waters yesterday, instead recommending new legislation to enforce tough new EU-wide safety standards for the offshore oil and gas industry.

The FT notes that Hungary's spill of toxic sludge will provide the first serious test of recent European legislation designed to ensure polluters pay for environmental damage they cause. The 2004 Environmental Liability Directive says polluters must restore a damaged environment to its previous state.

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: or call us on 0207 197 2333.