Thursday

17th Aug 2017

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.

Thank you for reading EUobserver!

Subscribe now and get 40% off for an annual subscription. Sale ends soon.

  1. €90 per year. Use discount code EUOBS40%
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

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.

News in Brief

  1. Mixed Irish reactions to post-Brexit border proposal
  2. European Union returns to 2 percent growth
  3. Russian power most feared in Europe
  4. Ireland continues to refuse €13 billion in back taxes from Apple
  5. UK unemployment lowest since 1975
  6. Europe facing 'explosive cocktail' in its backyard, report warns
  7. Danish police to investigate misuse of EU fishing rules
  8. German constitutional court questions ECB's €2tn spending

Stakeholders' Highlights

  1. European Healthy Lifestyle AllianceDoes Genetics Explain Why So Few of Us Have an Ideal Cardiovascular Health?
  2. EU2017EEFuture-Themed Digital Painting Competition Welcomes Artists - Deadline 31 Aug
  3. ACCABusinesses Must Grip Ethics and Trust in the Digital Age
  4. European Jewish CongressEJC Welcomes European Court of Justice's Decision to Keep Hamas on Terror List
  5. UNICEFReport: Children on the Move From Africa Do Not First Aim to Go to Europe
  6. Centre Maurits CoppietersWe Need Democratic and Transparent Free Trade Agreements Says MEP Jordi Solé
  7. Counter BalanceOut for Summer, Ep. 2: EIB Promoting Development in Egypt - At What Cost?
  8. EU2017EELocal Leaders Push for Local and Regional Targets to Address Climate Change
  9. European Healthy Lifestyle AllianceMore Women Than Men Have Died From Heart Disease in Past 30 Years
  10. European Jewish CongressJean-Marie Le Pen Faces Trial for Oven Comments About Jewish Singer
  11. ACCAAnnounces Belt & Road Research at Shanghai Conference
  12. ECPAFood Waste in the Field Can Double Without Crop Protection. #WithOrWithout #Pesticides