Wednesday

25th May 2022

Bumpy ride for fiscal compact in Dublin, Prague, Helsinki

  • The Finnish government faces a vote of confidence on Wednesday (Photo: IaRRoVaWo)

The EU’s new fiscal compact is again getting a bumpy ride from a number of quarters in member states, with opposition parties in Ireland warning over loss of sovereignty and the leaders of the Czech Republic and Finland also underlining concerns.

In non-eurozone Prague on Tuesday, Prime Minister Petr Necas stressed to reporters that the government must wait for full details of the new agreement, which calls for tighter fiscal discipline and monitoring of budgets by the EU, before it can sign up to it.

Read and decide

Join EUobserver today

Become an expert on Europe

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or subscribe as a group

"Our position has been absolutely clear -- we won't pledge to join the deal unless its parameters are known," he said.

The leader added that the country’s central bank should not be the actor that takes the decision on whether to chip in to the planned €200 billion loan to the International Monetary Fund, which would then be loaned on to eurozone states.

"I personally think the Czech Republic should not take part" he added, although the governing coalition is to discuss the issue Wednesday.

In Finland on Tuesday, the prime minister, Jyrki Katainen, said that the government could not agree to a transfer of national budget sovereignty to the European Commission.

He also added that the country cannot sign off on majority-based decision making on the boards of the EU’s bail-out funds, the European Financial Stability Facility and the soon-to-be-established European Stability Mechanism.

The leader made the comments during a debate in the parliament where the head of the eurosceptic True Finns party, Timo Soini, attacked the fiscal compact as eroding Finnish budget sovereignty, according to a report from YLE.

A vote of confidence in the government is to be held on Wednesday.

In Ireland the same day, after Taoiseach Enda Kenny briefed opposition parties on the deal, both Fianna Fail and Sinn Fein said that the new rules must be put to a referendum.

The government has said that it must consult its legal advisors before saying whether such a plebiscite should be held.

Fianna Fail chief Micheal Martin, whose party in government had signed up to EU-IMF imposed austerity in return for a bail-out, honed in on balanced budget rules that would limit deficits to just 0.5 percent of GDP, saying this would require the confidence of the people before going ahead.



"This will require a referendum from a political perspective, that people be consulted on the issue given that it seems to be the intention of the European leaders to write in to either constitutional law or its equivalent,” he said.



Sinn Fein leader Gerry Adams for his part also attacked the 0.5 percent ceiling.



"The government has signed up to a new and draconian 0.5 percent of GDP deficit limit. They have done this without having conducted an assessment of the social or economic consequences of such a move,” he said.


Separately on Tuesday, the honeymoon period for the technocrat government of Mario Monti came to rapid end, with Italian unions launching a week of strikes against his €33 billion austerity package.

Rolling strikes in different sectors, which enjoy for the first time in six years joint co-ordination between the normally bitterly divided three main union centrals, will continue through 19 December.

EU leaders embrace 'fiscal compact' demanded by central bank

EU leaders have endorsed a series of rules tightening budget surveillance and institutionalising limits on public spending - the ‘fiscal compact’ that the ECB has demanded before it can more aggressively purchase Italian and Spanish debt.

Mixed centre-left response on need for EU referendums

Centre-left politicians in a number of key member states are of mixed opinions about what has been agreed at last week's EU summit, suggesting that endorsements by parliaments will not be an easy task

New EU deal faces multiple referendum threat

Within hours of arriving at a fragile treaty deal for the eurozone and nine other EU states, the agreement delivering deeper integration is already confronting the spectre of multiple referendums and a host of legal barriers.

EU Commission extends borrowing curbs in 2023

The European Commission on Monday proposed to extend suspension of fiscal borrowing rule in 2023 — but advised prudence amid already rising real interest rates.

Commission grilled on RePowerEU €210bn pricetag

EU leaders unveiled a €210bn strategy aiming to cut Russian gas out of the European energy equation before 2027 and by two-thirds before the end of the year — but questions remain on how it is to be financed.

Commission grilled on RePowerEU €210bn pricetag

EU leaders unveiled a €210bn strategy aiming to cut Russian gas out of the European energy equation before 2027 and by two-thirds before the end of the year — but questions remain on how it is to be financed.

News in Brief

  1. Dutch journalists sue EU over banned Russia TV channels
  2. EU holding €23bn of Russian bank reserves
  3. Russia speeds up passport process in occupied Ukraine
  4. Palestinian civil society denounce Metsola's Israel visit
  5. Johnson refuses to resign after Downing Street parties report
  6. EU border police has over 2,000 agents deployed
  7. Dutch tax authorities to admit to institutional racism
  8. Rutte calls for EU pension and labour reforms

Stakeholders' Highlights

  1. Nordic Council of MinistersNordic delegation visits Nordic Bridges in Canada
  2. Nordic Council of MinistersClear to proceed - green shipping corridors in the Nordic Region
  3. Nordic Council of MinistersNordic ministers agree on international climate commitments
  4. UNESDA - SOFT DRINKS EUROPEEfficient waste collection schemes, closed-loop recycling and access to recycled content are crucial to transition to a circular economy in Europe
  5. UiPathNo digital future for the EU without Intelligent Automation? Online briefing Link

Latest News

  1. EU summit will be 'unwavering' on arms for Ukraine
  2. Orbán's new state of emergency under fire
  3. EU parliament prevaricates on barring Russian lobbyists
  4. Ukraine lawyer enlists EU watchdog against Russian oil
  5. Right of Reply: Hungarian government
  6. When Reagan met Gorbachev — a history lesson for Putin
  7. Orbán oil veto to deface EU summit on Ukraine
  8. France aims for EU minimum-tax deal in June

Join EUobserver

Support quality EU news

Join us