Sunday

30th Apr 2017

Rehn to get increased economic powers

EU monetary affairs commissioner Olli Rehn is to be given extra authority to supervise national fiscal policies, as the commission moves quickly to centralise economic governance powers in Brussels.

"[Rehn] will become deputy-head of the commission for economic and monetary affairs and the euro," and will have "additional working instruments," European Commission chief Jose Manuel Barroso told the European parliament on Thursday (27 October).

Dear EUobserver reader

Subscribe now for unrestricted access to EUobserver.

Sign up for 30 days' free trial, no obligation. Full subscription only 15 € / month or 150 € / year.

  1. Unlimited access on desktop and mobile
  2. All premium articles, analysis, commentary and investigations
  3. EUobserver archives

EUobserver is the only independent news media covering EU affairs in Brussels and all 28 member states.

♡ We value your support.

If you already have an account click here to login.

"This is the best way to guarantee independence, objectivity and efficiency in the exercise of the Commission's responsibility of coordination, surveillance and enforcement in the area of economic governance of the union and of the euro area in particular,” said Barroso.

It is also a way of making sure that economic governance stays within the hands of the commission, amid fears that eurozone member states would club together and make their own rules and institutions.

"Having a commissioner tasked especially with the euro shows that we want euro governance to happen within a communal framework," said the commission president.

The announcement came after a gruelling meeting of eurozone leaders that ran from Wednesday into the early hours of Thursday morning in which they managed to agree the broad outlines of bank recapitalisation, private sector loss on Greek debt and beefing up the eurozone bailout fund.

The final conclusions also state that eurozone leaders welcome the intention “to strengthen ... the role of the competent commissioner for closer monitoring and additional enforcement."

While the detail of the new powers are unclear, officials indicate Rehn would have more say over ensuring member states do not break deficit and debt rules.

The move is an important first step towards the calls from some member states to have a eurozone finance minister or at the very least a powerful economy commissioner.

Dutch Prime Minister Mark Rutte recently called for a super commissioner who would be able to intervene directly in the running of a fiscally misbehaving country, eventually even making it a "ward" of the commission.

Talking to MEPs, Barroso gave an indication of Rehn's future responsibilities.

"We are in the current situation not only because there was irresponsible financial behaviour but also because our member states, most of them, did not respect their commitments regarding the stability and growth pact."

Some member states did not report accurately their national statistics and at least one state manipulated the statistics in a fraudulent way. This is exactly the kind of behaviour that we cannot accept in the future," said the commission president.

He also noted that for a "true European economic union" both convergence and discipline is needed.

Fast-moving changes

While the EU's response to the eurozone crisis has been criticised for being too slow - the scope of Thursday's deal is already being questioned - it is moving quickly ahead with centralising economic governance powers in Brussels.

Along with the Rehn move, the commission now also has the authority to scrutinise national budgets and make suggestions for member state spending plans. Meanwhile, there is already talk about further strengthen these powers by way of a treaty change.

The effects are already clearly being felt on the ground in some countries. Greece, subject to a EU-IMF bailout and seen as slow in implementing austerity measures, is now to have permanent on-the-ground supervision of its policy-making.

And Italy, the country that eurozone officials fear may be caught up in eurozone contagion, has been made to promise to implement a raft of reforms. The commission said it would closely "measure and monitor" the pace of progress.

Banks stonewall EU leaders on haircut

Negotiations between EU leaders and representatives of the global banking industry over the scale of losses the financial institutions are willing to take on Greek debt have all but broken down.

Autumn forecast: EU economy in ‘dangerous territory’

Europe’s economy has deteriorated dramatically since the spring and growth has come to a standstill, the European Commission said on Thursday, warning that the bloc could very easily slip back into recession should “any further bad news” materialise.

Parliament wants equal powers over EU economic governance

Warning the “democratic credibility” of the EU has been damaged as economic integration proceeds with little input from ordinary people, the European Parliament has demanded that it be given equal powers to the other EU institutions over national budgetary control.

New anti-trust complaint looms over Microsoft

At least three security software companies “met several times” with the European Commission to complain about Microsoft’s alleged abuse of its market position. A formal case could follow.

Investigation

MEPs oppose EU agency to prevent Dieselgate II

The European Parliament said on Tuesday that there should be more EU oversight on how cars are approved, but stopped short of calling for an independent EU agency.

News in Brief

  1. Vote of no confidence prepared against Spanish PM
  2. Syria to buy Russian anti-missile system
  3. Germany seeks partial burka ban
  4. Libya has no plan to stop migration flows
  5. EU has no evidence of NGO-smuggler collusion in Libya
  6. Poland gets 'final warning' on logging in ancient forest
  7. Commission gives Italy final warning on air pollution
  8. Romania and Slovenia taken to court over environment policies

Stakeholders' Highlights

  1. European Healthy Lifestyle AllianceCharlotte Hornets' Nicolas Batum Tells Kids to "Eat Well, Drink Well, Move!"
  2. ECR GroupSyed Kamall: We Need a New, More Honest Relationship With Turkey
  3. Counter BalanceParliament Sends Strong Signal to the EIB: Time to Act on Climate Change
  4. ACCARisks and Opportunities of Blockchain and Shared Ledgers Technologies in Financial Services
  5. UNICEFRace Against Time to Save Millions of Lives in Yemen
  6. Nordic Council of MinistersDeveloping Independent Russian-Language Media in the Baltic Countries
  7. Swedish EnterprisesReform of the European Electricity Market: Lessons from the Nordics, Brussels 2 May
  8. Malta EU 2017Green Light Given for New EU Regulation to Bolster External Border Checks
  9. Counter BalanceCall for EU Commission to Withdraw Support of Trans-Adriatic Pipeline
  10. ACCAEconomic Confidence at Highest Since 2015
  11. European Federation of Allergy and Airways60%-90% of Your Life Is Spent Indoors. How Does Poor Indoor Air Quality Affect You?
  12. European Gaming and Betting AssociationCJEU Confirms Obligation for a Transparent Licensing Process

Latest News

  1. EU boasts unity on Brexit talks
  2. May’s election juggernaut
  3. EPP scolds Orban over university and NGO laws
  4. Oxford-Studie besorgt über 'Schrott' News in Frankreich
  5. Alte Freundschaft zwischen Le Pen und Putin
  6. EP chief faces questions after homophobic 'summit'
  7. EU signals Northern Ireland could join if united with Ireland
  8. One year later: EU right to open internet still virtual