Friday

4th Dec 2020

Dutch want Constitution to strengthen euro rules

A week before a crucial EU summit on the Constitution, to be held on 12 and 13 December in Brussels, the Dutch government has announced it will push for extra legal guarantees to force EU countries to comply with the Stability and Growth Pact.

In an interview on Dutch public television on Sunday (7 December), the Dutch state secretary for European Affairs Atzo Nicolaï demanded that the new Constitution include expanded powers for the European Court of Justice over the Stability Pact – the rules that underpin the euro.

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According to Mr Nicolaï, an increase of power of the European Court of Justice would avoid further 'political fiddling' with the stability pact by big member states. This would be a 'very important' point for the Netherlands in the negotiations on the EU Constitution, he added.

Breaking the Pact

On 25 November, France and Germany, two countries that are formally in breach of the Stability Pact rules, escaped fines from the European Commission following a majority decision by the finance ministers from the euro zone (the 12 countries that share the euro).

Immediately after this decision, the Dutch government considered taking France and Germany to the Court of Justice, but decided it did not have a strong enough case under the present euro pact rules.

It now wants these powers enhanced.

Blow to voters confidence

According to Mr Nicolaï, additional safeguards on the stability pact are necessary to restore trust in the EU among Dutch voters.

The State Secretary said that the Stability Pact crisis has left the impression among Dutch citizens that big member states apparently do not have to comply with European agreements.

There are fears that the whole affair could negatively influence the result of the referendum on the Constitution.

On Thursday 4 December, the think-tank CPB (Netherlands Bureau for Economic Policy Analysis) published a report which projects that the Dutch budget deficit will hit 3.25 percent of GDP in 2004 - above the three percent ceiling allowed by the euro rules.

The Dutch Finance Minister Gerrit Zalm, however, strongly dismissed the projections.

The Ministry of Finance said that they would examine their budgetary position on the basis of their own analysis in the Spring Report, not on the basis of other figures.

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