GERMAN CHANCELLOR Angela Merkel has escalated her campaign to change the European treaties ahead of a key summit tonight at which EU leaders will discuss new measures to fortify the union’s economic system.
Last night the German leader was still pushing for reforms to empower the EU authorities to deprive member states of their voting rights if they persistently break EU budget rules, something Taoiseach Brian Cowen and several other leaders strongly resist.
The chancellor phoned a number of EU leaders yesterday, among them Mr Cowen, in attempt to win support for this proposal and for the creation of a permanent rescue mechanism for any distressed euro country.
Although discussions late last night centred on a draft communiqué which would commit EU leaders to examine a “simplified” treaty change procedure to create a permanent fund, the question of suspending voting rights is held to be off limits for many leaders.
“There is real opposition to the idea of suspending voting rights. I think there’s a view that that would make ratification intensely difficult,” said a diplomatic source.
“The Government will approach this process with a view to trying to maximise the possibility of avoiding another referendum. The Government’s approach will be to see as far possible how to limit the scope of what is involved.”
Although Dublin believes measures to deprive a country of its voting rights would necessitate a referendum, Minister of State for Europe Dick Roche has argued in recent days that a permanent mechanism could be set up within the bounds of the Lisbon Treaty.
However, Dr Merkel was said last night to be insisting that there was no way to go down that road without modifying the treaty.
With that in mind, the clear intention in the deployment of a “simplified” amendment procedure would be to achieve change with minimum disruption.
Such a step would, however, remove the possibility of the European Parliament involvement in the debate as there would be no formal “convention” to change the treaty.
Although there is some confidence in Government circles that minor treaty amendments to facilitate the creation of a permanent fund would not require another Irish referendum, diplomats cautioned yesterday that the outcome could not be pre-determined.
At issue in the talks is whether the EU makes an explicit commitment to change the treaty, as Dr Merkel has sought, or simply adopts an open-ended commitment to examine that possibility.
“What they will look for is some indication that if treaty change is necessary all member states will support it,” said a diplomat.
This reflects acute concern in Germany that the country’s constitutional court will declare the euro zone rescue of Greece and the wider rescue fund for any single currency to be at variance with EU law. Berlin is understood to have made the argument that the chancellor would have greater scope for manoeuvre in that event if EU leaders had already committed to change the treaty.
While the Government does not object to the creation of a permanent rescue mechanism, diplomatic sources say Dublin has yet to adopt a position on Berlin’s demand for such a mechanism to include new procedures for “orderly” national insolvencies.
Several other member states are similarly opposed to the suspension of voting rights, among them the Netherlands, Spain, Italy, Portugal and the Czech Republic.
Luxembourgish prime minister Jean-Claude Juncker, the president of the euro group finance ministers, declared for this camp yesterday in German daily Die Welt. “To spell it out clearly: withdrawing voting rights from budgetary sinners is not a feasible path, and I rule out any change in the EU treaty on this issue,” he said.
An EU diplomatic source said the tensions between EU leaders were clear to European Council president Herman Van Rompuy, chairman of the summit.
Many European diplomats believe a reopening of the treaty risks opening the floodgates to a barrage of claims and counterclaims for other changes as governments seek advantage.
Dr Merkel, however, repeated her insistence that voting rights should be suspended for budgetary breaches in an address to the Bundestag lower house of parliament. The summit is due to “endorse” a report on a new financial sanctions regime which was agreed last week by a ministerial task force led by Mr Van Rompuy.
However, Dr Merkel said the task force proposals did not go far enough to safeguard the single currency, which was roiled by Greece’s brush with insolvency earlier this year and financial instability in countries such as Spain, Portugal and Ireland.
