Last week’s European Council was significant in many ways
First of all, it was the first formal meeting ‘post-Sarkozy’ as well as the first meeting for the new government in Greece; although Greece was represented by its head of state and not by incoming Prime Minister Antonis Samaras who could not travel to Brussels because he was recovering from eye surgery. In fact, those interested in statistics were quick to point out that the governments of most member states have changed with Luxembourg Prime Minister Jean-Claude Juncker and Maltese Prime Minister Lawrence Gonzi being the only two prime ministers still in office since Malta joined the EU in 2004.
The 28 and 29 June summit witnessed Italy’s Prime Minister Mario Monti and Prime Minister of Spain Mariano Rajoy winning the argument with Germany over the terms of any financial bailout that would spare both Mediterranean EU countries from having to impose new austerity measures. By conceding to Italy and Spain, German Chancellor Angela Merkel secured the two countries’ agreement for the ‘Compact for Growth and Jobs’ which is intended to provide “a coherent framework for action at national, EU and euro area levels” to re-launch growth, investment and employment in the EU as well as making the bloc more competitive.
This European Council also provided Malta with the opportunity to register at the highest level its disagreement with two of the country-specific recommendations: Raising the retirement age and reforming the system of wage bargaining and wage indexation (COLA). This disagreement had already been formally registered by Deputy Prime Minister Tonio Borg on 26 June during a meeting of the General Affairs Council in Luxembourg.
Furthermore, Prime Minister Lawrence Gonzi made it clear at the summit that Malta considers certain issues relating to taxation as being vital to the exercise of the national sovereignty of member states and directly impinging on the day to day life of citizens. Precisely because of this, such functions must not be passed on to the EU institutions because of what he described as their lack of democratic legitimacy. Taxation is and must remain a national competence, Dr Gonzi declared in his statement to the House of Representatives on 3 July.
Another important aspect was the progress registered in the Multiannual Financial Framework (MFF). Significant progress was registered under the Danish presidency of the Council and the negotiations should be completed during the Cyprus presidency that took over on 1 July. Malta is insisting on a safety net for member states having a GDP that exceeds 75% of the EU average as a result of the statistical impact of Bulgaria and Romania’s accession to the EU in 2007.
On 26 June, Malta, together with the other member states forming the Friends of Cohesion Group, presented a joint statement to the General Affairs Council on the conditions for quality investment. The statement highlights the importance of Cohesion Policy as a tool for growth and jobs. As stated by Deputy Prime Minister Borg: “The ultimate objective is for Malta to secure the necessary funding to develop “a critical mass” in economic terms to allow the economy as a whole to benefit permanently from the capital injection that comes with Cohesion Policy funding”. Malta’s priority is that for the period 2014-2020, the country will maintain the same level of funding it has benefited from so far as a member state.
Although August is not the busiest of times for the EU institutions, undoubtedly the institutions have been entrusted with very important and urgent tasks by the European Council. No country or institution can afford to take a holiday at this crucial juncture. The June European Council represented a genuine attempt by EU heads of state or government to provide the EU with the necessary impetus as well as to design the tools required to emerge from the crisis and embark on a strategy for growth and employment.
Dr Vanni Xuereb is head of Meusac