9 May 2010: Europe resurgent, sixty years after Schuman

The rescue plan adopted by the European leaders on 9 May of this year, as they teetered on the brink – history throws up these little moments sometimes – did not simply mark the beginning of the end of the financial crisis which had been rumbling on for nearly three years. It is now up to us to make the most of the unexpected boost it is giving to European solidarity by rolling out a new project which may prove every bit as momentous as that launched by the great Robert Schuman sixty years ago.

The Monnet method, enshrined at the time in the Schuman Plan, entailed the creation of a new dynamic in the form of very specific,

de facto

solidarities. The first step was to establish the European Coal and Steel Community, which entailed a pooling of the chief energy source and the most widely used raw material at the time. In essence, the plan of 9 May 2010 boils down to a new process of ‘financing pooling’: the Member States of the euro area have pooled their borrowing capacities. The next step has to be a ‘budgetary pooling’. Because measured against the ever-greater powers given to the European Union by the treaties, and the ambitious plans its leaders are drafting as part of the Europe 2020 strategy, the EU has only a tiny budget, equal to 1% of the combined GDP of its Member States: this is 20 times less than the total value of all the national budgets together. Not having its own resources, the EU is funded by contributions from the Member States.

Member States, unable to control their own finances properly, are reluctant either to pay more into the communal pot or to allow the EU to raise funds that are not used directly for their benefit.

The new political climate brought about by the events of recent weeks prompts me to make two suggestions.

Firstly: now that the principle of European economic governance has at last been accepted, let us have the national parliaments involved right from the outset. Let us have, on the same date each year, a joint budgetary policy debate between the national parliaments and the European Parliament. This straightforward exercise will not be legally binding but will be hugely instructive. It will force all of us to work from the same economic assumptions regarding growth, interest rates, the value of the euro or the price of a barrel of oil. It will very naturally encourage each of us to demonstrate, to the national media and general public, that our national budget respects Community disciplines and helps to fund common objectives. It will break down the ‘glass walls’ which compartmentalise the European debate into 27 national debates, and it will help people to understand that a shared analysis of national budgets can lead to substantial and unimagined savings.

Secondly: the time has come to open up the debate on the scale of the European budget and how it should be financed. How should the tasks, and thus the resources, be divided between the national and European budgets? To be honest, this has never been discussed since the Treaty of Rome. It warrants the calling of a major financial conference, tasked with drawing up a budgetary charter for the Union. This is something which the next Belgian Presidency might undertake, along the lines of its predecessor in 2000, which set the wheels in motion for the European Convention.

Alain Lamassoure, 14 May 2010