Thursday

26th May 2022

Euro-tsar to have veto powers on national budgets, Schaeuble says

  • A euro-commissioner should have veto powers according to Schauble (Photo: World Economic Forum)

The EU should have its own "currency commissioner," according to an ambitious new plan set out by German finance minister Wolfgang Schaeuble.

Under Schaeuble's plan, which would include further changes to the EU treaties, a new European commissioner responsible for economic and currency affairs would need to sign off on national budgets before they could be implemented by governments.

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

Outlining the proposals to journalists on his flight returning to Berlin from the annual meeting of the International Monetary Fund and World Bank in Tokyo on Tuesday (16 October), Germany's finance minister said that his leader, Angela Merkel, was fully behind him.

"When I put forward such proposals, you can take it as a given that the chancellor agrees," he said.

Schaeuble also wants the currency commissioner to have similar status to the competition commissioner, who has a mandate to make decisions on EU competition policy without the agreement of the rest of the college of commissioners, arguing that this independence would "depoliticise" the role and improve decision making.

It would also create two tiers of MEP within the European Parliament, with decisions relating to the eurozone being made only by MEPs from countries using the euro.

The question of creating a special committee for the eurozone has support from some MEPs, and was suggested by the likes of Pervenche Beres, the French centre-left chairwoman of the employment committee, in 2011, but is widely seen as a divisive step by deputies.

The plans would built on the six legislative files on economic governance agreed by the 17 eurozone countries in 2011 and came into force in January.

They are now required to present national budgets to the commission to show how they intend to meet debt and deficit reduction targets.

However, while the commission has the power to ask for additional tax rises or spending cuts to meet budget targets and to impose fines on countries which fail to deliver, it does not have formal veto powers.

Schaeuble's salvo is the latest sign that Germany is prepared to deepen fiscal and political integration and builds on proposals already agreed by Merkel's governing Christian Democrat party (CDU).

However, with Merkel finding it increasingly tough to force measures relaxing the terms of bailout conditions and increasing the firepower of the EU rescue fund, the ESM, through the Bundestag, her government is only offering the carrot of deeper European integration in exchange for strict supervision powers at EU level.

Schaeuble's suggestions come as EU leaders prepare for Thursday's summit in Brussels.

Alongside discussions on the commission proposals to establish the European Central Bank as the single supervisor of the eurozone's banking sector, politicians are also expected to focus on Spain's solvency.

Despite informally requesting up to €100 billion to support its private banks, Spain is widely expected to request a formal bailout before the end of 2012.

Leaders will also discuss European Council President Herman Van Rompuy's "ideas paper" which was sent to national capitals last week.

The Van Rompuy paper also raised the possibility of having a finance minister for the eurozone, as well as a special budget, alongside the prospect of establishing new EU-level instruments to ease debt financing.

The mooted instruments include short-term eurobills and a "debt redemption fund" first proposed by a German advisory panel of economic experts.

Eurozone needs 'limited fiscal solidarity'

The eurozone should consider introducing treasury bills, a special budget and a finance ministry, says a new ideas paper ahead of next week's summit.

No eurozone-only assembly, say MEPs

MEPs have dismissed suggestions that a new parliamentary body should be set up solely for eurozone members stating that “no new accountability structures specific to the euro-area must be established.”

National parliaments 'not best' for EU's interests

A new ideas paper on progress towards further EU integration highlights the shifting power sands for national parliaments as the European Parliament is set to become the principle democratic guardian of a future EU.

Orbán's new state of emergency under fire

Hungary's premier Viktor Orbán declared a state of emergency due to the war in neighbouring Ukraine hours after pushing a constitutional amendment through parliament, where two-thirds of MPs are controlled by his Fidesz party, allowing his government special powers.

Opinion

When Reagan met Gorbachev — a history lesson for Putin

Neither Reagan nor Gorbachev achieved their goal at the famous Reykjavik summit of 1986. Despite that fact there are lessons that current leaders — particularly Vladimir Putin — could adopt from these two iconic leaders.

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