16 February 2016

Schulz: I cannot pre-empt European Parliament’s approval of emergency brake on benefits but wrong to speak of a veto

David Cameron has this morning been holding talks in Brussels with European Parliament President Martin Schulz and other senior MEPs regarding the parts of the renegotiation package – most notably the ‘emergency brake’ implementing the restrictions on EU migrants’ access to benefits – which will require approval by MEPs. Speaking at a subsequent press conference, Schulz said that the European Parliament would begin the legislative process immediately after the vote and that while he could not guarantee its outcome, he said that in his experience, once EU leaders and other EU institutions reach an agreement, “Things go in a good direction.” He also stressed that this was the normal legislative procedure and not a “veto” for MEPs.  Writing on the Open Europe blog, Open Europe Co-Director Raoul Ruparel argues, “It is worth remembering that it would be a politically nuclear option for member states’ MEPs to rebel against their governments, and in many cases their own party leaders, to reject a deal which their heads of government had agreed to.”

Meanwhile, Cameron travelled to Paris for talks with French President François Hollande yesterday evening. After the meeting, a Number 10 spokesman said the two leaders “agreed that we are making good progress on the UK renegotiation and that the draft text from the European Council provides a firm basis to reach agreement at this week’s [EU] summit.” A French Presidency source said that “there’s a political will to conclude” a deal at the upcoming EU summit, but “there is still work to be done, especially on economic governance” – the section of the proposed UK-EU agreement addressing the relationship between Eurozone ‘ins’ and ‘outs.’ Meanwhile, ECB President Mario Draghi told the European Parliament yesterday, “The [UK-EU] agreement, whatever it will be, should not hamper any further integration movement for our monetary union. A less than clear agreement would have implications of systemic nature and its implications would not be positive for the European monetary union.”

Source: Open Europe Blog: Can MEPs scupper Cameron’s renegotiation deal? France 24 TF1 Reuters

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New poll sees Remain lead shrink from 18 to eight points

A new ComRes poll for ITV News has found that 49% of respondents said they would vote to Remain and 41% said they would vote to Leave, with 10% undecided. Compared to the last ComRes poll in January before the announcement of the provisional UK-EU deal, support for remain is down by five points and support for Leave is up by five points. The poll also found that 42% of those asked said they may still change their mind before the referendum. 70% of people who voted Labour at the last general election would vote to remain, while Conservative voters are more divided, with 45% supporting remaining and 48% leaving.


Cameron expected to call emergency Cabinet meeting after finalising renegotiation

The Daily Mail reports that David Cameron has agreed to convene an emergency Cabinet meeting on Friday evening once he returns from the European Council summit at which he is expected to finalise his renegotiation. Cabinet Ministers and other frontbenchers who support a UK exit from the EU will then be allowed to publicly argue this case ahead of the vote on 23 June. The Times reports that a source at one of the Leave campaigns believes that between twelve and 20 ministers outside the cabinet will end up backing Brexit. The Daily Telegraph quotes junior Cabinet Office Minister John Penrose as warning that the public will be ”bored to tears” if the EU debate lasts too long.


Central and Eastern EU member states insist UK’s proposed child benefit curbs should only apply to newly-arrived EU migrants

Eastern EU member states are insisting that a plan to index child benefits paid overseas to the living standards of the country where the child resides, which forms part of the proposed UK-EU deal, should only apply to newly-arrived EU migrants and not be retroactive. Czech Europe Minister Tomas Prouza told the BBC Radio 4 Today programme this morning, “The proposals are clear that the limits on in-work benefits would apply only to the newcomers as it’s a very UK-specific solution, so we need the very same guarantees also for the child benefits indexation that applies only to the newcomers and only those working in the UK.” He added, “The issue we have is not with the UK and David Cameron’s demands, the issue is with other countries trying to piggyback on the British proposals for their own benefit.” The Polish Foreign Ministry told the Financial Times in a statement, “We are of the opinion that possible indexation [of child benefits], if agreed to be introduced, should pertain only to newcomers to the relevant member states, so that the conditions applying to existing migrants remain unchanged.”

Meanwhile, speaking after a meeting with Romanian President Klaus Iohannis yesterday, European Council President Donald Tusk said, “The proposal I have put on the table is a fair and balanced one. The safeguard mechanism on access to in-work benefits is not designed to apply to EU citizens currently working in the UK. This proposal protects the freedom of movement, while helping the UK to address its concerns when it comes to their specific system of in-work benefits.” Tusk went on to warn, “It is natural in negotiations that positions harden, as we get closer to crunch time. But the risk of break-up is real because this process is indeed very fragile. Handle with care. What is broken cannot be mended.”


Hedge fund Toscafund says Britain would be better off outside the EU

The Daily Telegraph reports that Toscafund, one of the largest hedge funds based in London has claimed that Britain would be a “better place” if it left the EU. Savvas Savouri, an economist at the fund, is quoted as saying that London’s status as Europe’s financial hub would not be threatened by an exit because there was no “plausible alternative in the western hemisphere”, adding that any attempts to “economically ostracise” the UK if it voted to leave would probably backfire, resulting in “self-inflicted trauma on a number of EU members.”

However, a separate report by the Council of European Employers of the Metal, Engineering and Technology-based industries (CEEMET) warns that Brexit would result in a “lose-lose” situation for manufacturers across the bloc, which could trigger a “downward spiral” in UK growth.


Visegrad Group thwart Merkel and call for ‘Plan B’ on migration crisis

The Visegrad Group of Prime Ministers from Hungary, Poland, Slovakia and The Czech Republic have called on the EU to prepare a “plan B” to stem the migration crisis if current EU plans fail to deliver results by mid-March, with Slovak Prime Minister Robert Fico accusing “certain European politicians” of making “big mistakes in the migrant crisis.” Following a summit in Prague, the leaders said they were ready to help Bulgaria and Macedonia seal off the Balkan Route if other measures failed, with Hungarian Prime Minister Viktor Orban announcing that he has already sent personnel to assist border guards in Macedonia. German Chancellor Angela Merkel told Stuttgarter Zeitung, however, that she is opposed to the idea, “Simply building a fence in Macedonia, which is not an EU member…would not solve our problems,” she said. The EU yesterday approved an additional €10m to help Macedonia deal with the crisis.

Meanwhile, Greek Defence Minister Panos Kammenos announced on Tuesday that four of Greece’s five new hotspots to register incoming migrants are “ready to function and welcome refugees.” Separately, Die Rheinische Post reports that German Interior Minister Thomas de Maizière estimates that 500,000 asylum seekers will arrive in Germany in 2016.


House of Lords report warns Britain’s global influence would be damaged if it left EU

The House of Lords EU sub-committee on external affairs has warned that the EU’s strategies for dealing with “unstable and dangerous” neighbours have “glaring weaknesses.” Peers criticised the EU, as well as Nato, for its “inadequate” deterrence in the Baltic States and Black Sea, and said it was “unclear” if Russian military action would be met with a “forceful” response by European states. The EU sub-committee on external affairs also warned Britain’s international influence would be “significantly limited” if it leaves the EU.

Meanwhile, former Prime Minister Gordon Brown writes in the Daily Mirror, “We need to lead Europe, not leave it.” He argues, “We can lead because the rest of Europe is looking for a united front against a military-resurgent but economically-enfeebled Russia, a counterweight to balance the dominance of Germany, a champion of a more democratic, accountable and competitive Europe and someone to lead the fight for jobs under threat from low-wage competition from Asia…It is time to be honest. If we want something done, Europe is where we can best carry influence and where we can do most good, for ourselves and the world.”


German Constitutional Court to hear case over ECB’s bond-buying programme

The Karlsruhe-based German Constitutional Court will today hear a case over whether the ECB overstepped its mandate by unveiling a scheme for potentially unlimited purchases of Eurozone government bonds – the Outright Monetary Transactions (OMT) – back in 2012. The case had been referred to the European Court of Justice (ECJ), which last year ruled that the OMT is compatible with EU law. A final ruling by the German Constitutional Court is not expected for a few months.


Irish Minister for Finance Michael Noonan accused of “distracting the debate” on comments about Portugal and economic stability

Sinn Féin deputy leader Mary Lou McDonald has accused Minister of Finance, Michael Noonan of “distracting the debate” and “brazenly cooking the figures” after he warned “voters should look to Portugal if they want to see how political instability leads to economic instability”. Meanwhile, Taoiseach Enda Kenny firmly ruled out any grand coalition with Fianna Fáil in a debate last night, arguing that the country still hadn’t forgiven Fianna Fáil for the recession, and that the sensible option was a return of a Fine Gael and Labour coalition.


Bosnia launches formal EU membership bid

The Daily Telegraph reports that Bosnia-Herzegovina has lodged a formal application to join the EU. Open Europe’s Pawel Swidlicki is quoted as saying, “Given the array of obstacles both within the EU itself as well as among the various candidate countries, the EU needs to devise a new flexible model that allows for closer economic and political ties but which neither compels candidate countries to commit to the maximum level of integration – including euro membership – nor does it lock them out completely.”


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