UK Gears Up For 'Hard Bargaining' Over EU Constitution

by Ulrika Lomas, Tax-News.com, Brussels

19 June 2003

Former French President Valery Giscard d'Estaing, head of the Convention on the Future of Europe, is due to present a draft of the planned European Constitution to an EU summit this coming Friday after many months of intense negotiation between member states. However, more hard bargaining lies ahead as EU members gear up for six more months of discussions on the draft at the Inter-Governmental conference commencing in October, where the UK government is expected to fight fiercely to protect its national veto, particularly on matters such as unified taxation and economic policy.

Driven by the need to reform the EU's creaking institutional structure as the Union enlarges to 26 members, the Convention has made a bold attempt to introduce substantial extensions to the majority voting mechanism. The Commission, and many of the existing and new small members, hoped to see dilution of the veto, certainly as regards taxation and foreign policy. However, they have had their desires thwarted after Tony Blair made it clear during previous negotiations that the UK would block any attempt to end the veto.

In tune with most EU foreign ministers, British Foreign Secretary Jack Straw agrees that the Convention's draft is "a good starting point for the lengthy negotiation ahead," although he added during a recent parliamentary seminar that: "like any draft, it is open to improvement."

One aspect of the draft that Britain is expected to dig in its heels over is article 14, which is concerned with the central coordination of economic and employment policies, and which Straw is expected to vehemently oppose. "Nor do we support tax harmonisation," he announced recently, continuing: "We have a unanimity lock on any such proposals in the ICG."

The United Kingdom will also be working towards a rewording of article 24, which deals with the sensitive subject of qualified majority voting. "We don't like that and will be working to change that at the ICG," the UK Foreign Secretary pledged.

However, in a recent governmental statement, Straw also sought to "explode the myths" surrounding the constitution debate by assuring UK voters that "we are not talking about a substantial expansion of EU-wide powers."

"We are talking about a Treaty which can bring much needed clarity to European citizens, which equips the Union with the machinery it needs to embrace the challenge of enlargement," Straw announced.

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