Van Rompuy says decisions on ESM can not be blocked

Wed, Jul 4, 2012, 01:00

INDIVIDUAL COUNTRIES do not have the power to block decisions made by the European Council which involve the European Stability Mechanism (ESM), the president of the European Council, Herman Van Rompuy, insisted yesterday.

Addressing the European Parliament in Strasbourg, Mr Van Rompuy was responding to questions from MEPs about the implementation of last week’s EU summit proposals, after Finland and the Netherlands raised concerns about aspects of the deal.

Last Friday, European leaders agreed on a set of measures to deal with the euro zone crisis, which included a proposal to allow ESM funds to be used to recapitalise banks and the establishment of a single supervisory banking authority. However, Finland and Netherlands have questioned aspects of the deal.

During a debate on the outcomes of the summit yesterday, Dutch MEP Barry Madlenar said the terms of the ESM treaty had been changed after the summit. “Our parliament at the moment is at the ratification process of the ESM, but our elected representatives assumed that there would be no banking support, and now that seems to be about to happen. Our parliament has been lied to.”

But Mr Von Rompuy said the ESM treaty included an article which would not allow individual countries to block decisions made by the council.“Every member has to take its own responsibility seriously, particularly when it comes to implementing decisions that have been agreed unanimously,” Mr Van Rompuy added.

Describing last week’s European Council meeting as a “step in the right direction”, he added that the “lion’s share of the work” still lay ahead. He also reiterated the euro group’s commitment to examining Ireland’s situation. “The euro group will examine the situation of the Irish financial sector, with the view of further improving the sustainability of Ireland’s well-performing adjustment programme.”

Guy Verhofstadt, president of the centre-right grouping ALDE, called for the EU summit proposals to be implemented by September. “Concrete legislation is needed. We now have a window of opportunity for a few weeks.”

Mr Verhofstadt welcomed the specific proposal to introduce a new single banking supervisory authority, pointing out that the European Parliament had suggested the appointment of an independent supervisor two years ago. The agency should be “a single supervisor with powers to close down banks in any member states, with no exceptions”, he said.

Also addressing parliament, European Commission president José Manuel Barroso called for unity, pointing out that overcoming divisions had been one of the primary forces behind the formation of the European Union.

“I don’t like when I see heads of government coming out of European Councils saying ‘I won against the others.’ That is exactly against the European project.”

He said that the financial crisis was not a creation of the euro zone, but rather an issue for Europe as a whole, pointing out that Britain had spent more tax-payers’ money on its banks than any country in the euro zone since the onset of the financial crisis.

Since 2008, Mr Barroso said, Britain had committed €2.9 billion to its banks through recapitalisation measures, equating to 4.9 per cent of GDP, €40.41 billion through asset relief programmes and had guaranteed €158 billion to its banks.