Friday, January 22, 2010

Blooded and Bloodied - The New Commission has been initiated by the European Parliament but only after MEPs get their scalp

Over the last two weeks, the European Parliament held hearings with every single prospective Commissioner – except the President. The hearings are the only occasion for Members of the European Parliament (MEPs) to genuinely bring some influence to bear on the formation of the next Commission. While Commissioner Hearings are a useful exercise in casting some light on a rather secretive selection process, do they really inject the kind of accountability that the Commissioners like to pretend it does and do MEPs really feel that they have held the Commission to account after listening to a series of set-piece answers?

Questions are designed to test the nominee’s credentials, size up their commitment to the European agenda – over and above any national interests – and scrutinize their priorities for the next five years.

The Hearings certainly put the candidates’ probity and record to the test. The Commissioner-designate from Bulgaria, Rumania Jeleva, was allocated the humanitarian aid portfolio but was compelled to stand down after accusations that she failed to fully declare her financial interests while she was an MEP.

As an exercise in determining the policies and priorities for the prospective Commissioner’s five year mandate, it was a disappointment but only because the candidates played safe by repeating the lines of their predecessors. This was to be expected since they will have been prepped in advance by advisers to the incumbent Commissioners and, of course, because the President of the Commission, Jose Manuel Barroso has already set a course for his second term.

If the Hearings were designed to expose gaps in the candidate’s knowledge of their portfolios, it worked. Some arrived with a clear command of their briefs; notably Connie Hedegaard, who chaired the Copenhagen Climate Change summit on behalf of the Danish Government and now commissioner designate for Climate Action. Others who are new to their allocated policy responsibilities such as Joacquini Almunia, the respected Spanish Commissioner for Economic Affairs and now designate for Competition, demonstrated less expertise in the All eyes were on Baroness Ashton – the newly-appointed High Representative for Foreign Policy and Security – returned to the Parliament for a second time to face MEPs. This time she appeared in her capacity as the nominated Vice President of the European Commission and Commissioner responsible for External Affairs. Members of the Parliament’s Foreign Affairs committee were keen to hear more about how she would undertake her duties as arguably the EU’s answer to Hilary Clinton. Alas, it was a lacklustre performance. Many MEPs commented on her responses as unfocused, uninspiring, showing only a superficial knowledge of the world issues. She failed to clearly prioritise her agenda, mentioning every continent other than Oceania as her priority.

It was her British compatriots on the Foreign Affairs committee that gave Baroness Ashton the toughest grilling. Conservative members tried to embarrass the former Labour leader of the House of Lords with questions about her past employment in the CND.

Nevertheless, she remained composed and confident throughout the hearing, honestly admitting her lack of knowledge on certain issues. In any case there was no real danger that MEPs would object to her candidature given the unanimous backing she received for the High Representative position by Member States

Mutterings over the performance by Neelie Kroes, the Commissioner-designate for the newly-created Digital Agenda role, caused some nervousness in President Barroso’s camp. She was the only nominee to be called back for a second smaller meeting, in which coordinators of the main political groups came out satisfied by her more solid opinions and agenda for Digital Europe. Her poor showing at the Hearing surprised many given that she was respected for her grip on the competition portfolio in the previous Commission.

Members of the highly influential internal market committee wanted to see how far the French Michel Barnier would differ from the Irish Charlie McCreevy in the powerful Internal Market Commissioner role. His nomination caused a fracas with the British when the French President gloated that his appointment represented a defeat for the Anglo-Saxon model. M Barnier, however, was at pains to reassure members of the committee that he would not blindly follow a French model of market economics. He played down prospects of heavy-handed regulation under his stewardship of the internal market role. He even quoted Adam Smith – an icon of the free-market British.

The Commissioner Hearings provided the European Parliament with a chance to flex their muscles. The recently-ratified Lisbon Treaty gives MEPs new decision-making powers in more policy areas – such as Justice and Home Affairs and Sport. Parliament was certainly keen to demonstrate its prowess. The reality is, however, that MEPs cannot veto individual candidates although it can refrain from approving the entire Commission team. On Monday evening (18 January), co-ordinators from the political groups met to discuss Rumania Jeleva’s candidature and it soon became clear that MEPs would reject the Commission if Ms Jeleva remained in post. The Socialist & Democrat Group was particularly adamant. The leadership of the European People’s Party responded to pressure from the Socialists with a half-hearted request for the head of Slovakia's socialist nominee, Maroš Šefcovic, nominated for the lowly inter-institutional relations role, ostensibly for comments he was
supposed to have made at a conference in 2005 that Roma were “exploiting the Slovak welfare system”. However EPP Leader Joseph Daul backed down admitting he did not have the stomach for “blood and corpses”.

This outbreak of political posturing has only served to delay the process of assembling a new College of Commissioners. The College was due to be approved by a parliamentary vote on 26th January. The most likely replacement for Ms Jeleva should be Kristalina Georgieva, currently, Vice-President of the World Bank. Her hearing should take place on February 3rd. The parliamentary vote will now take place on 9th February. It will be an anti-climax to a long and wearisome process that started with political-horse-trading over President Barroso’s re-appointment and the uncertainty of when if ever the Lisbon Treaty would ever be signed, meaning the existing Commission had to stay on as a caretaker Commission after its official mandate expired in November 2009.

The Hearings have dominated events in the European Parliament last week. However, there has been a lot of noise and too little light for the Hearings to be of any real worth to MEPs and the general public. The prospective Commissioners will feel that they have escaped the Hearings without too much damage being inflicted. In reality, they have all benefited from safety in numbers and owe their individual mandate not to the Parliament but to their own national Governments still.

Wednesday, January 13, 2010

Iceland referendum and EU acession talks is a Perfect Storm

Iceland is gearing up for EU acession talks to begin in March this year. In a case of seriously unfortunate timing, Iceland is holding a referendum on the Icesave Bill on either 27th February or 6th March. In early March the Icelandic Government will also enter formal acession negotataions with the EU.

UK Chancellor, Alastair Darling hinted darkly on 4th January that the British Government would block Icelandic membership if they did not sign the bank repayment deal. Since then, Icelandic President Grimmson declared that he would not sign the bill and instead referred the issue to a national vote. Icelanders are certain to reject the anglo-dutch deal.

Although the British Foreign Office has since given assurances that the UK won't interfere with the Icelandic negotiations on EU membership, the reality is that the UK may beforced to take a stronger line once the Referendum rejects the repayment arrangements - not least because it will not want to be seen as being forced to back down at a time when the UK is in the middle of a febrile election period.

The problems for Iceland's acession plans don't end there. Germany and France have said that they will not make any concessions to Iceland - even if they are generally positive about Icelandic membership. The first two sectors that will be negotiated are fisheries and agriculture. Icelandic waters are rich pickings for European fishermen and fisheries represent a quarter of Icelandic exports. This will be a big test of Iceland's appetite for EU membership. At a time when it is trying to recover from the financial disaster, it is being asked to submit to strict EU quotas. IN adition, the French will be scrutinising very closely the talks on Icelandic membership of the Common Agricultural Policy. Iceland's 3,000 farmers fear that CAP membership will reduce local agricultural production by up to 50%. Nevertheless CAP membership does offer other benefits to Iceland.

The Germans are even more lukewarm about the prospect of Icelandic acession. The CSU - Angela Merckel's sister party has said it is not the EU's duty to "save" countries in trouble.

Despite this, Iceland could still expect a fast-track process. The country already meets 80% of the community acquis. True - there has already been a delay in achieving candidate status. The country had expected to gain candidate status in December but it was only because of internal EU wrangling over Lisbon appointments that delayed the decision. The present European Commission is a caretaker one with no mandat to make new decisions. Iceland must wait until its successor is properly in place. The Council can only confer candidate status after a recommendation from the EU executive. These recommendations need parliamentary approval too.

Iceland is still hopeful of EU membership in two years and membership of the Euro in four years.

One of the biggest attractions of EU membership for Iceland would be to join the Euro, after the virtual destruction of its currency. This, however, requires a preliminary period of two years during which the Icelandic krona would need to be within the narrow band of the Exchange Rate Mechanism. It would be difficult for Iceland to negotiate an exemption from this requirement, which is embedded in the Maastricht treaty

Iceland is a member of the European Economic Area, and participates in many EU programmes, including the Schengen agreement. Understandably it was disappointed that the Union did not mobilize itself quickly to come to the stricken country's aid, forcing it to turn instead to countries such as Russia and Japan, with which it has no formal links.

Despite the widespread disappointment with the EU, many Icelanders appear to have concluded that their best bet for the future would be to join the Union as soon as possible. Membership has never been so popular.

However, the dispute with the UK and the Netherlands over bank bailouts - as well as indignation in Rekjavik that it is forced to beg its Nordic neighbours for IMF support, could mean public support for EU membership could soon wane. Iceland needs to redouble its efforts to improve bilateral relations with key EU member states to ensure there is no further delay to EU acession talks. There is every risk that the country could be blind-sided by adverse developments from IMF loan talks and the Icesave bail-out referendum. Its essential then that it strengthens informal as well as the more formal channels of communications with the EU and its members (the UK in particular). It should demonstrate its European credentials by hosting a major informal EU summit in Rekjavik later this year to draw a line under the banking crisis fall-out and set about finding a pan-European solution to guaranteeing bank deposits. Iceland should regain its confidence after a series of polital and economic blows and set out what it can do to bring something to the European table.