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Limited reforms for climate panel The Intergovernmental Panel on Climate Change has agreed changes to its guidelines in the wake of criticism of the science in its 2007 report. bbc.co.uk |
France and Germany hijack strict new eurozone budget regime European Commission officials concede that there has been a Franco-German stitch-up over new euro rulesGermany and France have agreed to soften a rigid new regime of fines for countries breaking the eurozone's budget rules a week before a crucial EU summit is supposed to ratify a punitive system aimed at shoring up the single currency.Senior EU officials preparing the new rules, which have been devised to immunise the euro against a similar kind of collapse that it faced as a result of the Greek debt crisis, put a brave face on the sudden Franco-German hijack. But European Commission officials conceded that there had been a Franco-German stitch-up to weaken the way the new euro regime would operate and to leave it more vulnerable to political horsetrading.In a another highly contentious move, Angela Merkel, the German chancellor, Nicolas Sarkozy, the French president, also agreed to reopen the Lisbon Treaty, the EU's quasi-constitution, in order to force countries that find themselves in a crisis such as the one suffered by Greece to declare insolvency and to forfeit their voting rights in EU councils.At a summit on the Normandy coast on Monday evening, Sarkozy yielded to German pressure to reopen the treaty in return for Berlin dropping its insistence that sanctions for fiscal sinners in the eurozone be automatic. The call to reopen the treaty will run into strong resistance, with European leaders exhausted by the bad-tempered nine years it took to finalise the Lisbon pact which came into force last year.It could also spell trouble for David Cameron, the prime minister, who opposed the treaty and will come under pressure to hold a referendum in Britain if it is renegotiated. "If EU politicians want a new treaty, they must first give the people a referendum. Now is the chance for cast-iron Dave to make good on his reneged promise to hold an EU referendum. I'll believe that when I see it," said Marta Andreasen, the Ukip MEP.Cameron will argue that even if the treaty is reopened, the changes affect only the eurozone countries and not Britain, meaning there is no need for a British vote.For the past six months, EU leaders have been drawing up plans for "European economic governance" as a response to the sovereign debt crisis in Greece that nearly destroyed the euro and produced an unprecedented €750bn (£658bn) euro crisis fund. Insisting that the Greek disaster must never be allowed to repeat itself, they stressed there would be new disciplines for the 16 countries using the euro, entailing swingeing fines for debt and deficit delinquents.Herman Van Rompuy, the EU council president, was put in charge of a "task force" of finance officials from across the EU to draft the new regime. It met for the last time on Monday and its proposals go to an EU summit next week. In parallel, the European Commission delivered legislative proposals.Under the draft laws last month from Olli Rehn, commissioner for monetary affairs, countries would face fines of 0.2% of GDP for flouting the stability and growth pact, the euro rulebook which limits budget deficits to 3% of GDP and national debt levels to 60%. The penalties would come almost automatically, decided by the commission and could only be stopped subsequently by a qualified majority vote of EU governments.The system was designed to try to avoid the kind of political trade-offs inevitable if the decisions were taken by EU governments.Germany, as the EU's fiscal disciplinarian, was the strongest supporter of the automatic fines and the commission. Sarkozy led the opposition, arguing for the primacy of politics and elected governments over national budgets.The Franco-German agreement said any sanctions applied would be "automatic", but made clear that any decision to fine would be by EU finance ministers and not the commission, increasing the likelihood of political dealmaking."Back in 2004 it was France and Germany that weakened the stability pact. Now they are doing it again," said a senior commission official.The German media despaired of Merkel's concessions."The government has failed grandiosely," said FT Deutschland, "in its campaign to make the new stability pact a real instrument of budget discipline."European monetary unionEuropeEuropean UnionFranceGermanyEuroCurrenciesGreeceAngela MerkelNicolas SarkozyIan Traynorguardian.co.uk © Guardian News & Media Limited 2010 | Use of this content is subject to our Terms & Conditions | More Feeds guardian.co.uk |
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