Real story won't bark at Vienna

There is nothing, but nothing, more exciting to my colleagues in the British press corps here than a good Europe-out-to-get-the-Brits story, particularly if the Germans are involved. "Have you heard the latest", one of tabloid breed announced the other day, "the Austrians won't be handing over the Presidency after Vienna, the Germans will be marching in to seize it."

You get the general idea . . .

They are preparing the ground for the summit in Vienna today with all the Churchillian rhetoric they can muster for an expected - or, faute de mieux, manufactured - full-pitched battle over tax harmonisation, and bloody sideskirmishes on EU budget contributions and even duty-free.

All are matters, of course, of considerable concern to Ireland and Bertie Ahern who will make common cause on the first with the British Prime Minister, Tony Blair, and on the latter with both Mr Blair and Germany's Chancellor, Gerhard Schroder. On the budget he will have to content himself with the Spanish, Portuguese, and Greeks as allies. It will all be great fun and wonderful copy for the hacks, but the real story it ain't. The real story, to paraphrase the great detective, is the dog that will not bark.

In 20 days' time the single currency will be launched in 11 member-states. This summit is the last opportunity for the leaders of the EU to meet and put finishing touches to what many see as potentially the greatest achievement of European integration.

But there is virtually nothing to do in Vienna. The battles of the past, whether in Dublin in December 1996 over the Stability Pact or in May over the appointment of Wim Duisenberg as head of the European Central Bank, are well and truly over. The once-reviled, once-impossible, once-utopian single currency is now on autopilot to launch and noises off will not deflect it. That is the real story of Vienna.

Yet the debates at the summit do matter to the longer-term future of the Union, even if no decisions can be expected here. Both the budget debate and that on post-single currency economic co-ordination are about what sort of a Union we want.

Behind the predictable Agenda 2000 special pleadings from all the national capitals lie deeper questions about cohesion and economic solidarity between member-states. Is the treaty commitment no more than a fairweather obligation to be jettisoned, or slashed, as soon as the winds of fiscal rectitude get up? Or is it an ongoing commitment to states which have willingly opened up their markets to the great god of the single market?

At present the budget row is deadlocked, and will remain so for the next few days, between net contributors and net recipients with the latter, broadly speaking, backing the Commission's position set out in Agenda 2000.

The net contributors are led by the Germans and the Dutch. These rich countries have real political problems about the size of their contributions which others sympathise with (as opposed to the British, Austrians and Swedes, whose problems are seen as imaginary). They have opened up a new front in the last fortnight by moving the budget debate from the contribution side of the equation to the payments side, with calls for a freezing of the budget at its 1999 real level.

Mr Ahern will back the Commission's original budget and test the water for Ireland's new regionalisation proposals (yet to be sanctioned by Eurostat).

He is also certain to back Mr Blair's rejection of any threat to our respective corporate tax regimes, although he will take comfort from Wednesday's joint German-British declaration which has sought to pour oil on troubled waters. It appears the Germans have reconciled themselves to putting tax harmonisation on the back-burner. We shall see . . .

The issue could come up in Vienna in two guises. First, during the debate on post-single currency economic co-ordination, both France and Germany are likely to insist that the monetary level playing field must not become a battlefield in which member-states undercut each other in beggar-my-neighbour tax competition.

Second, it may arise in the context of the Finnish wish to launch a new Inter-Governmental Conference (IGC) during its presidency in the latter part of next year.

Once Amsterdam is finally ratified in the spring, there is agreement that a new IGC should be convened to complete the institutional reforms fudged by the treaty and which are deemed essential ahead of enlargement - the re-weighting of votes in the Council of Ministers in favour of the larger countries, and the size of the Commission.

Some would like such an IGC's remit also to cover the extension of majority voting to other areas of policy, notably taxation.

Although the failure of Amsterdam to bite this bullet is seen by many as the treaty's greatest lapse, it may also be that to open the IGC to such a debate would only be to call the bluff of some of the more integrationist members. Soundings by Irish diplomats around Europe have found little real enthusiasm to cede further sovereignty in this area.

On enlargement, the summit is likely to endorse the Commission's progress report on negotiations, with the French prevailing in their insistence that no more countries should be added for the foreseeable future to the list of those involved in direct accession talks.

Mr Ahern will also use the occasion to sound out the candidacy of the former Tanaiste, Mr Dick Spring, our unofficial contender for the job known as Mr CFSP, Mr Common Foreign and Security Policy. Officially High Representative for CFSP, the job was created by the Amsterdam Treaty to give new bite to the Union's diplomacy. The appointment is now likely to be made in the summer. Other candidates include the former British ambassador to the UN, Sir David Hannay. The Spanish are canvassing support for the current favourite, the High Representative to Bosnia, Mr Carlos Westendorp.

The rumoured French candidate, Justice Minister Elisabeth Guigou, has declared that she is not interested.

Mr Spring has significant support among the smaller memberstates and some senior Commission figures - as a serious outside bet he'd certainly be worth a few quid.