Donnerstag, 21. Oktober 2021

The European Policy Quartet: Which priorities should the Conference on the Future of Europe focus on?

With:
  • Carmen Descamps, European Liberal Forum, Madrid
  • Julian Plottka, University of Passau / University of Bonn
  • Sophie Pornschlegel, European Policy Centre, Brussels
  • Manuel Müller, Der (europäische) Föderalist / Institut für Europäische Politik, Berlin
This conversation was conducted as an online chat in German. The transcript below has been edited and translated.

Road sign saying 'Changed priorities ahead'
The Conference on the Future of Europe is an opportunity to reform the EU. What shall we use it for?

Manuel
The Conference on the Future of Europe is in full swing. In August, the first interim report on the debate on the digital platform was published, since the end of September, the first meetings of the four citizens’ panels have taken place, and in October, there was the second meeting of the Plenary Assembly.

This should also change the public perception of the conference. During the last months, the discussion (also among us) was mostly about the format of the conference – the question whether this new model of citizen participation could be a success for the EU. Today, however, we want to talk about content: On which issues should pro-Europeans in the citizens’ panels and in the plenary place their priorities – because they are a) important for the EU and b) achievable for the Conference?

For this, each of us in turn makes a reform proposal that they would recommend to the members of the Conference. Each of us will take two turns, so we will talk about eight possible priorities in total. I have used a random generator to define the order: it’s Julian, Carmen, Sophie, Manuel. The second round will be in reverse order. Everything clear?

Carmen
¡Vamos!

Clear responsibilities in EU economic policy

Julian
My first suggestion is one from the “Democracy” topic, also in view of the continuing conflicts of interest between the EU institutions in the Conference. This policy area is strongly promoted by the federalist usual suspects on the digital platform, and the European Parliament also has high expectations. Therefore, institutional reforms, especially the strengthening of European democracy, must be prominently included in the final declaration of the Conference by all means. Otherwise, the overall outcome would massively lose support.

Therefore, my first proposal is to create clear democratic responsibilities in economic governance. At the EU level, the European Parliament should decide on economic policy guidelines and concrete country-specific recommendations; the national reform programmes/investment plans should be adopted by national parliaments.

Sophie
Do you mean that the European Parliament should have a say in the European Semester? And how would you imagine the involvement of national parliaments in the multi-annual financial framework and the Corona recovery fund Next Generation EU (NGEU)? Already now, the European Parliament has a vote on the financial framework at the very end – but this is more rubber-stamping than real co-decision.

Julian
The focus of my proposal is the European Semester and NGEU (or possible successor programmes). The aim should be to counteract the increasing executive-heaviness of decisions and to create clear responsibilities at both the EU and the national level. At EU level, the role currently held by the Council should be taken over by the Parliament. National reform programmes should be adopted by national parliaments on the proposal of governments. Regarding the multiannual financial framework, I would also welcome a stronger involvement of the European Parliament. But I would not want to involve national parliaments more, as we do not need more veto players in the EU.

Manuel
I agree that a stronger role of the European Parliament in defining EU economic policy is an important priority. That’s also because it can be well explained in public: Why has such an important policy area so far been governed (largely) without the European Parliament? The only thing is that the European Semester and the country-specific recommendations would then need to be given some more force – so far, member states have often just ignored them.

Julian
Up to now, the EU often got competences in economic policy first and parliamentary legitimacy was improved only later. Here would be an opportunity to proceed the other way round:create sufficient legitimacy first so that the European Parliament then also has an institutional interest in expanding the effectiveness.

Carmen
I can only agree with this. Giving more competences to the European Parliament as the representative of European citizens would create better legitimacy than the Council, in which primarily national interests are represented.

Sophie
From my point of view, it is important to ensure that the processes are not made more complex than they already are. At the same time, they should become more “democratic” – but there are various opinions as to what exactly that means. Some would say that the national governments – the Council – are more legitimate than the European Parliament. Of course, this is the eternal problem in a “union of states and citizens”.

Julian
The proposal has precisely the advantage of giving national parliaments a stronger role without making decision-making procedures more complex. And it can be assumed that the binding force of the reform programmes will increase rather than decrease if they are adopted by the national parliaments.

Transnational lists

Manuel
Let’s move on – it’s Carmen’s turn with the next proposal!

Carmen
My reform proposal also comes from the field of democracy: transnational lists! Admittedly, this is not a new topic, but it is close to my heart and there might actually be a majority for it. In the European Parliament, a reform of electoral law is already underway. Domènec Ruiz Devesa from the S&D is rapporteur on the subject.

Manuel
Yesss, transnational lists are (almost) at the top of my list, too! 😁

Julian
Absolutely, I agree on that as well. Also, I think there will be quite an outcry in the European Parliament if the proposal doesn’t move forward. The only question is which stance the EPP is going to take this time.

Carmen
Transnational lists would promote a European public sphere and European citizenship, strengthen the democratic idea and allow genuine European candidacies with European electoral topics – similar to what parties like Volt are already trying to do today. Transnational lists would affect only a part of the available 751 seats, of which many are currently vacant since the departure of British MEPs. And transnational lists would also provide a response to the high turnout in the 2019 European elections, which was the highest in 25 years.

Sophie
… though still “only” at just under 51%. As much as EU circles consider this an important question, I’m not sure it’s an issue that is particularly relevant to citizens. Besides, the EPP has always opposed it so far, and it remains the strongest group in the European Parliament.

Manuel
In my view, EU-wide lists offer one of the most important leverages for strengthening European democracy. It is true that most citizens don’t give much importance to the reform – but if it were to come into force, it could profoundly change the way the EU and European parties are perceived in public. In my view, the only question is to what extent the Conference is necessary for this reform. Rather, it could be that the electoral reform will just be negotiated within the European institutions.

Julian
The issue of perception is a big topic for the whole conference. In a recent survey of European local politicians by the Committee of the Regions, 46 per cent of respondents were not aware of the conference, 43 per cent had heard of the conference but did not know what activities were taking place in their constituency.

Graphic with survey results. Text: Awareness about the Conference on the Future of Europe. 11% have been actively involved in the Conference or are aware of related activities in their constituency. 43% know about the Conference but are not aware of related activities in their constituency. 46% are not aware about the Conference.
Source: Committee of the Regions, Flash Eurobarometer: Local politicians and the future of Europe, survey period 2021/07/21-09/09.

To put it somewhat cynically: if the project fails, 449 of the 450 million EU citizens will fortunately not notice it at all. But the others are crucial stakeholders that we need for the future of the European Union. If they don’t get some of their hearts’ desires met, we run the risk of them turning away from Europe in disillusionment.

Sophie
Perhaps one more addition: I very much hope that alongside transnational lists, the reform of the electoral law will also make sure that voters know who they are voting for. There should also be European election campaigns and stronger European political parties that are not just an “appendage” of their national parties.

Julian
I agree. But I think transnational lists are also a chance to further Europeanise parties, because Europarties would for the first time play a role in deciding who gets on a candidate list and into the European Parliament.

Carmen
Absolutely. If European elections are to get over the stigma of being “second-order elections”, the whole campaign will have to become more European – in discourse, personnel and organisation of the parties.

European standards for minimum wages

Manuel
A lot of consensus here so far … This needs to get a bit more controversial. Sophie, do you have a nice contentious proposal for us? 🔥

Sophie
One point in advance: I am a bit pessimistic that the proposals of the Conference on the Future of Europe will be included in the institutional EU decision-making process at all – that is, I doubt that there will be a good “backlink” into the institutions. Therefore, it is important that the topics of the Conference be oriented as closely as possible to the existing work programme of the European Commission.

In this sense, my reform proposal is not a new one, but one that is currently blocked in the Council: introducing a minimum wage standard at EU level. This would ensure that we move towards to a convergence of living standards. Especially now after the Corona crisis, there is great danger that inequalities will increase.

Carmen
So you are proposing an agenda setting that strategically takes up issues that have already been discussed in order to increase the chances of implementation. This would not be the openness of issues that the Conference on the Future of Europe set out to achieve. But in a way, it’s the same with my transnational lists. Not all topics are fundamentally new, nor can we expect them to be.

Julian
As much as I support the proposal in principle (though we must not disempower the strong unions in Scandinavia in this process), I wonder what the role of the Conference is here. If we need the Conference to solve blockades in the Council, this means that we’re talking about institutional issues again in reality.

Manuel
In any case, a European minimum wage standard could be an issue that goes down well with the public. So that if the Conference generates enough attention for it, that might help to put pressure on the blocking governments.

Sophie
Exactly. You can also see from the first citizens’ panel in Strasbourg that the issues focus strongly on fair working conditions and social justice.

I don’t quite understand the argument regarding Scandinavian countries, though. Why would an EU minimum standard disempower Scandinavian trade unions? After all, it would not change anything about the fact that Nordic countries can and should have high minimum wages.

Manuel
As far as I can see, the countries that are blocking in the Council are rather those in the East, who often see EU social policy regulations as an obstacle to their own economic growth.

Sophie
Here we see again why we need more transparency in the Council to know who exactly is opposing new EU initiatives.

Julian
The problem for the Scandinavians is that they don’t need minimum wages because the trade unions are so strong there. It’s a question of power: introducing minimum wages at the EU level and regulating wages by law would undermine the tripartite system. For the moment, this would not be an immediate problem because governments would not use this instrument to interfere with wages. But you never know who might come to power – in particular in Scandinavian countries – and then possibly try to weaken the trade unions. So even a well-intentioned precedent is a problem for them.

More majority decisions in the Council

Manuel
So, it’s my turn … Actually, I’m a bit surprised that my reform proposal hasn’t been mentioned by any of you yet, because as far as I can see, it’s among the most discussed ones at all: the extension of majority decisions in the Council. This would not only make the EU more effective, but also indirectly strengthen the European Parliament, because proposals supported by a majority could no longer be stopped by individual governments. In fact, both the European Socialists and the European Greens (as far as I know, the only groups that have explicitly named substantive goals for the Conference in advance) have majority voting on their list of priorities.

Julian
In Germany, at least, the circle of supporters is even larger: the CDU/CSU parliamentary group writes in its paper on the Conference: “Increasingly, individual member states are paralysing the decision-making process of the institutions with their veto. Decisions are often less oriented towards the common good than towards national interests. […] If we want a Europe that is capable to act, we must overcome the structures that prevent us from reacting promptly to crises in Europe.”

Sophie
I will take a position here that is not necessarily my own – but an often-heard argument against majority voting is that while it would be helpful in making decisions (that is, a “more effective Council”), the subsequent implementation of the decisions would become much more difficult because many national governments would simply not accept them. This would in turn weaken the legitimacy of the EU’s decisions.

Carmen
On this subject, I also recall the majority decision on the distribution of refugees within the EU in 2015 – it was possible under EU law, but far from being popular. The efficiency of the implementation of this majority decision is also sufficiently well known. Still, I would like to see more majority decisions especially in foreign policy issues, in order to strengthen the EU’s capability to act, for example vis-à-vis Russia or China.

Manuel
Sure, the example of refugee quotas shows that the legal possibility of majority decisions alone is not everything. But what Hungary, Poland and the Czech Republic did back then was an open disregard for European law. If we were to get to the point where we had to accept this behaviour from European governments as a normal standard, things would really go bad for the EU.

Sophie
As a matter of principle, the path to more majority decisions can only work if in parallel more efforts are made to achieve greater convergence within the member states. However, this requires a long-term strategy to make sure that national governments and national parliaments as well as citizens exchange more and develop a stronger European interest instead of insisting on their national ones. That is, they need to develop an understanding that a Europe that is capable to act is also in their own interest.

European taxes

Manuel
OK, the second round goes the other way – I’ll start. Another sensible reform priority, in my view, would be to reform the own resources system – that is, to finance the EU budget more through taxes (for example, plastic and other environmental taxes, a business tax, etc.) rather than through contributions from member states.

This could help to get beyond the vexed “net contributor” debate and would also give the EU new possibilities for political steering, as it would become easier to tax rather than ban things.

Sophie
This would be an important debate – also because we need to think about how to pay back NGEU without reducing the EU budget in the coming years. The problem is that the “frugal”, fiscally conservative governments (Denmark, the Netherlands, Austria, Sweden, partly also Finland and Germany) do not want to have common debts – not even if they are debts of the EU’s own budget. That means that we must finally get rid of the populist narrative “the moral and productive North pays for the lazy and morally questionable South”.

And although it was repeatedly said during the German election campaign that this is not the case: NGEU has set a precedent. And that is a good thing.

Manuel
Yes, perpetuating the NGEU precedent would be another item on my list of priorities 😉

Julian
The repayment of the bonds will indeed become a special problem, since the money has already been spent and the issue no longer offers any potential to politically shape things. A 2020 ECFR survey has shown that the Danish government is now more Eurosceptic than its people: the latter are willing to spend more money as long as it is used wisely. This point can be used to break the ranks of the “Frugal Four” when the shape of a new budget is being discussed. But when it is only a matter of repaying old debts, the people and the government will surely be back on the frugal line.

Carmen
In principle, I also like the point about having negative incentives through taxation instead of bans. This way (in most cases) everyone can decide for themselves whether to take this (financial) hurdle – for example, when choosing a means of transport or in the automotive industry. And the question of financing that Sophie has mentioned, is, of course, the quibbling topic par excellence. As a German resident in Spain, I am well aware of both perspectives here.

But: what should the implementation look like with EU taxes? Does the EU levy taxes directly and the contributions of the member states are reduced by the corresponding percentage in return? Or do national contributions to the EU budget remain similar to what they are now, and the total EU budget is higher in the future thanks to own resources?

Manuel
Well, in the first place, it would be about replacing (as much as possible) the contributions of the member states by EU taxes. The size of the total budget is an independent question. Already now, the “traditional own resources” (customs revenues, etc.) and the VAT own resources are the first to be used to meet the EU’s financial needs, while national contributions are only used to close the remaining financial gap. If new EU taxes lead to more own resources, fewer national contributions will be needed for the same budget.

Julian
Above all, an own resources system worthy of that name would also finally open the way to modernising the EU budget. In this way, the guardians of the agricultural budget would lose their greatest means of pressure.

Strengthen climate policies

Manuel
Moving on – it’s Sophie’s turn for the second reform.

Sophie
My second proposal would be to support concrete measures to reach the legally binding climate neutrality target by 2050. For this, the EU will need to push ahead the Fitfor55 package – and perhaps go even further,because even with Fitfor55 we are unlikely to reach –55% CO2 emissions by 2030. Moreover, the EU also needs to ensure the success of the Just Transition Fund.

Manuel
Indeed, the design of a European Climate Fund is likely to become a topic of discussion in the Conference plenary – in any case, it is on the Conference wish list of the Greens. Of course, this is one more point on which in reality almost all arguments have been exchanged long before the Conference.

Carmen
Maybe we just need the Conference to build up (additional) pressure from EU citizens. There has been no shortage of reform proposals on the future of the EU, especially in recent years, but implementation has been blocked or slowed down by various bodies. This brings us back to the point that a follow-up to the Conference is necessary in order to satisfy the high expectations of citizens and the European public and not to waste this opportunity.

Sophie
Exactly! In Brussels, we talk about the “delivery gap”: the greater the Commission’s ambitions, the greater the danger that it will fail in implementation.

Julian
But is the Commission really that ambitious? I think the Commission is rather moderate, both in its goals and in its ability to implement them.

Sophie
I think that in the twin transition, that is in the area of climate and digital policy, the EU Commission is indeed very ambitious considering the balance of power in Europe. Especially with the Fitfor55 package, we are going to see some very controversial discussions, because it is a really comprehensive and large reform package that is driving major changes.

Carmen
Then again, especially in the area of climate and digital policy, such ambitious proposals are necessary to make sure that after all the debates and amendments during the legislative process, there is at least a minimum of progress. With regard to the 1.5 degree target, the EU and the member states really need to step up a gear. The latest IPCC report once again confirms that small steps are not enough.

Manuel
Carmen, it’s your turn with the next reform proposal!

Reform of the Stability and Growth Pact

Carmen
Let’s talk about – money! With my second proposal, I hope to create a little more dissonance in our round. I would be in favour of revising the fiscal rules of the Stability and Growth Pact and thus also strengthening their enforcement or compliance. The basic idea was to prevent excessive deficits and unsustainable debt levels in order to create stable budgets in the member states.

Against the background of the multiple crises (the financial and economic crisis, the climate issue, most recently COVID-19), the targets set out in the Maastricht criteria are perhaps too ambitious or no longer reflect reality. It seems that many member states aren’t actively striving to meet the criteria any more – despite the European Semester and its follow-up by the Commission. France and Spain, among others, are therefore pushing for a reform of the European fiscal criteria and a flexibilisation of the budget deficit beyond the current 3%. For example, the criteria could include rebates for future-oriented spending, such as investments in the areas of climate, digitalisation, etc.

Julian
In Germany, there is currently a discussion about how to bypass the debt brake as an obstacle to a “traffic light coalition” (composed of social democrats, Greens, and liberals), and special funds are discussed as a possible solution. Sebastian Dullien has rightly pointed out that fiscal rules such as the debt brake mean that, when debt levels are high, government spending is outsourced into separate budgets and public-private partnerships are started. As a result, fiscal rules lead to a lack of transparency – and we saw a few years ago what can happen on the markets when states conceal their real debt levels.

Therefore, it makes sense to relax the rules in order to increase budget transparency. At the same time, this would also strengthen democratic accountability. And above all, we should build in the rebates before the debt is incurred – and not introduce exceptions to the EU stability criteria afterwards, as has happened under Jacques Chirac and Gerhard Schröder when it became clear that Germany and France were going to miss their targets.

Manuel
Incidentally, the then Italian Prime Minister Mario Monti already called for the introduction of such a “golden rule” for credit-financed investments almost ten years ago. If the German government, with a traffic light coalition, is willing to move this forward, the chances are good that something will happen.

Of course, this brings us to the question which expenditures are really “investments in the future”. But perhaps this could just be solved politically. We could have a procedure in which the European Parliament specifies in the country-specific recommendations which investments can be exempted from the deficit rules, and the national parliaments decide whether they actually want to take out the corresponding loans. In this way, investments would only be financed through debt if the European and the national parliament agree that this makes sense.

Sophie
I am absolutely in favour of such a reform. The criteria of the Stability and Growth Pact should be adapted to reality. Take, for example, the debt limit of 60% of the GDP: this figure was arbitrarily chosen in the 1990s, when public debt was much lower than it is today. But that does not automatically mean we are in a crisis. Economic conditions have changed since then. Instead of concentrating only on the criteria, we should think much more towards the future when it comes to economic and budgetary policy: Which funds do we need for which public investments that will be particularly relevant in coming years?

(And by the way: we should also consider whether GDP is still the right measurement for the future. For example, the aid for the flood disaster this summer in Germany cost more than 30 billion euros – and that had a positive impact on the German GDP. So we should look much more at how the money is spent and which criteria we use to measure prosperity).

Carmen
A small addition: I am not only interested in adapting the fiscal criteria to reality, but also in enforcing them. Otherwise they run the risk of degenerating into a farce and deceive rather than protect. Intergenerational justice is also an important keyword, because when it comes to spending, we should not shift additional burdens onto future generations.

Sophie
Yes, we need both: to reform the criteria, but then also to enforce them. Otherwise we have a similar problem as with competition rules. If they no longer correspond to reality, (strong) member countries decide to ignore them and we end up with arbitrary, political decisions – and double standards in the EU are never a good idea.

A roadmap for the future reform process

Manuel
We are approaching the end: it’s Julian’s turn to make the final reform proposal.

Julian
My second point is not so much another priority for the Conference as the question of its outlook. Looking at the – with all respect – organisational chaos of the Conference, I don’t think that the final report will be more than a wish list on which everyone can write whatever they want. I don’t see how it will lead to concrete reforms, especially considering the continued reluctance of national governments.

This raises the question of how we can really tackle the necessary reforms. Therefore, my main request to the Conference on the Future of Europe and the EU institutions is to come up with a roadmap on how to restart the reform process after spring 2022. My fear is that we need a new initiative for this. The Conference is only a first step to collect ideas, but not part of the actual reform process.

Sophie
Yes! The Conference should be seen as a pilot project, and we should not have too high expectations. In principle, it is welcome that the EU is “testing” deliberative democracy and wants to involve citizens. But deliberative democracy is not per se an EU reform process. It is a way to extend participation and to give the EU greater legitimacy throughbroader “input”.

For it to become a reform, however, it must be linked back to the existing political process. That’s also why I think it is important that the Conference does not only exist at EU level, but that, for example, citizens’ panels also take place within the member states, embedding the Conference into the national public spheres. In the end, the EU reform processmust be supported by national governments in order to be successful. The Conference might be able to build up pressure on governments to move forward – but that can take a while.

Julian
The German election campaign has just shown how necessary it is to strengthen national debates on Europe. 🙄

I fear that national governments are still invoking the “Pandora’s Box” argument that anti-Europeans could use treaty reform for their own purposes, and will therefore want to wait until pigs can fly and we have 27 pro-European national governments. In this context, the Conference could have been an opportunity to build up pressure – not even by all citizens, but by interested stakeholders. But for that we would have needed a reasonable procedure and political leadership.

Carmen
For me, it feels a bit like former Commission President Juncker’s 2017 White Paper process that generated five scenarios with visions for the future of the EU, which were frankly quite superficial, and to which French President Macron indirectly responded already at that time with the Sorbonne speech. That is why I agree with Sophie: it is essential that national governments support the reform efforts and are ready to implement them. At the time, the German government did not exactly stand out with its responsiveness. Germany can no longer afford that. You don’t have to support everything, but at least you have to (want to) get engaged in the debate.

Julian
The comparison to the White Paper process is valid, but there is also a decisive difference regarding the role of the Commission President: Back then, Juncker took the reins away from the European Council – now, von der Leyen lets the member states block the Conference. She seems to care very little about what happens in the end.

Manuel
Paradoxically, one of the main reasons to establish the Conference was precisely to overcome the many blockades in the Council. If it now also fails because of such blockades, we will have to look for new ways. In this sense, a realistic plan on how to achieve a successful reform process could really turn out to be the most important outcome of the Conference.

The question is, of course, what these paths might look like. And what price we are willing to pay for it – for example in terms of “differentiated integration”, which I myself am not a big fan of, but which might be necessary in order to move forward on a smaller scale. I doubt whether this debate can still be held in the Conference itself; after all, it already ends next spring. But perhaps the Conference will be an impetus to at least have this discussion in the public sphere.



Carmen Descamps is a Non-Resident Research Fellow at the European Liberal Forum in Madrid.


Julian Plottka is a Research Associate at the Jean Monnet Chair of European Politics at the University of Passau and at the University of Bonn.


Manuel Müller is a Senior Researcher at Institut für Europäische Politik in Berlin and runs the blog „Der (europäische) Föderalist“.

Images: Road sign Changed priorities ahead: Peter Reed [CC BY-NC 2.0], via Flickr; portrait Carmen Descamps: Life Studio [all rights reserved]; portraits Julian Plottka, Sophie Pornschlegel, Manuel Müller: private [all rights reserved].
Translation from German: Carmen Descamps, Manuel Müller.

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