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08/12/2016

Hill survives attack by UKIP’s ‘Big Bad Woolfe’

UK & Europe

Hill survives attack by UKIP’s ‘Big Bad Woolfe’

Social media gave a running commentary on Jonathan Hill's hearing. This image was tweeted by Julia Reda MEP. [Julia Reda/ Twitter]

Jonathan Hill wasted no time in displaying his pro-EU credentials at his European Parliament confirmation hearing today (1 October), and was promptly attacked by a UK Independence Party MEP.

The strongest criticism the Stability, Financial Services and Capital Markets Union Commissioner-designate received came from a fellow Brit, UKIP’s Steven Woolfe, who was swiftly nicknamed “Big Bad Woolfe” on Twitter.

That was despite Hill’s hearing coming at a time of strained UK-EU relations and just a day after Prime Minister David Cameron said he would not be “heartbroken” if the UK voted to leave the Union in a future referendum.

Although Hill’s hearing appeared to have been smooth, he was not endorsed by the Economic and Monetary Affairs Committee. The MEPs will write to Jean-Claude Juncker demanding a second meeting with Hill, most likely on Monday or Tuesday.

European commitment

To boos from other MEPs, Woolfe said, “In the words of the King James Bible […] no man can serve two masters. Which one is your master now the Queen or the EU?”

“It’s rare to hear a British voice in a position of authority in this house,” he said mischievously.

Woolfe was pointing to a potential conflict between Hill’s oath of loyalty to the Queen, in becoming a lord in the UK’s second chamber of parliament, and the oath to the EU he will take to become Commissioner.

Hill said he had been lucky enough to meet Queen Elizabeth II. “I don’t believe for one instant that her Majesty would consider there was any conflict between the oath I gave her and the oath I will give as Commissioner.”

Woolfe attacked again, later in the hearing.  He accused Hill of having no power or influence to protect the City of London, the EU’s major financial centre.

Under Jean-Claude Juncker’s new Commission structure, Hill will be working with France’s Pierre Moscovici, candidate for the economics portfolio, Valdis Dombrovski, Vice-President for the Euro and under Vice-President Jyrki Katainen, who has overarching responsibility for jobs and growth.

“I came here to work in general interest as European Commissioner. I did not come here to protect the City of London,” Hill said.

An effective, well-regulated financial system was in the interests of financial services everywhere in Europe, he added.

“But you’d be wrong if you were to caricature me, as I am sure you are for domestic political reasons, as someone who doesn’t care [about the City of London], he told Woolfe to applause from MEPs.

 

 

Woolfe returned for a third bite at Hill, accusing the EU of planning to introduce taxation of the City through the back door.

Hill said, “I don’t see that as part of the job I am here to fulfil […] I don’t think you are really interested in the answer I provide.”

http://www.euractiv.com/video/ukip-lord-hill-which-one-your-master-queen-or-eu-308855

Spotlight on UK and Hill

Cameron has promised to hold an in/out “Brexit” referendum if the Conservatives win next May’s general election.

Marco Zanni’s Italy’s Five Star Movement asked if Hill’s nationality constituted a conflict of interest.

Hill said, “I don’t accept there is a conflict and I will discharge my duties completely in the European interest.”

Asked if he would play a role in re-negotiating the UK’s relationship with the EU, he said the simple answer was that it was not his job.

Hill, who began his opening speech in French and Italian, told MEPs he wanted to the job because he wanted the UK to stay in the EU.

He said, “I want my country to remain part of a Union of 500 million people with shared values, who live together, work together, trade together and who face global challenges together.”

Hill pointed out he had worked on the Maastricht Treaty negotiations when working for the UK government and for Ken Clarke, the pro-EU Tory grandee.

German MEP Burkhard Balz appeared particularly pleased with Hill’s use of French, and was spotted taking a snap of the Commissioner on his tablet.

 

 

His hearing was also against the backdrop of the triumph of the Eurosceptic party UKIP, which was the most successful British party at the European elections.  

MEPs have also not forgotten Cameron’s opposition to Jean-Claude Juncker, his increasingly tougher talk on Europe and his 2011 veto on an EU-wide treaty change to tackle the eurozone crisis.

Bankers’ Bonuses

A number of MEPs were also concerned that a Brit would have oversight of the City of London, the EU’s major financial centre.

The UK has launched a legal challenge against the EU’s bonus cap, which it argues violates EU treaty provisions.

Commission President-elect Jean-Claude Juncker has already moved to allay those concerns by removing responsibility for bankers’ bonuses from Hill’s DG and to DG Justice.

The UK has launched a legal challenge against the EU’s bonus cap, which it argues violates EU treaty provisions.

Sven Gielgold, who pushed in the last Parliament for a similar cap on fund managers, said, “Aren’t we really employing someone who is basically a bull in a china shop?”

“I am not here as a representative of the City of London. I am here to represent the European interest and to make right decision in terms of effective regulation, stability and I hope growth,” Hill answered.

His predecessor Michel Barnier has asked the European Banking Authority to investigate whether allowances banks have begun giving to top staff are a ruse to dodge the cap, which stands no more than fixed salary, or twice that amount with shareholder approval.

Responding to reporters’ questions afterwards, Hill said that the legislation had been passed and if broken, he would expect it to be enforced.  

Light on detail?

Hill was accused of being light on detail on some major legislation he will be responsible for.

 

 

When asked for his opinion on Eurobonds, debt investments issued by the eurozone nations, Hill said, he had not given it “much thought”. That was one reason why MEPs did not endorse Hill after the hearing, instead inviting him to a public exchange of views at the committee.

Philippe Lamberts, a Belgian Green, said Hill was “charming but empty”.  He said he would ask for a vote but added he expected Hill’s nomination to be endorsed.

 

 

Hill refused to commit to a timetable to introduce the final pillar of the EU’s banking union, the single deposit guarantee scheme. Elisa Ferreira asked him to propose it before 2015.

The scheme reimburses a proportion of deposits to savers whose banks have failed. Hill said he could not make that commitment at this stage,

He did try to answer concerns that it was not right that a member of a non-eurozone nation was oversee the completion of the EU’s Banking Union. While it is open to all member states, at present only euro area countries are members.

Hill said, “Yes, I come from a country outside the Banking Union, but the crisis has highlighted how interdependent the 28 member states are […] I will do everything I can to make it a flagship for the European Union.”

Hill also discussed the capital markets union, a plan to bring in new, underdeveloped sources of finance for European businesses, which are dependent on bank funding. Since the crisis that source of finance has dried up since the crisis.

He said, “This is a project for all 28 and the goal is clear […] to help unlock the capital around Europe that is currently frozen and put it to work in support of Europe’s businesses, particularly SMEs.”

But again MEPs criticised him for being light on detail.

Hill said he needed more time but did back “transparent, well-regulated” securitisation, where bank loans are packaged and sold on the market. Opaque and complex securitisation was blamed for the US subprime mortgage crisis, which some argue spurred the global financial crisis.

 

 

He also backed the inclusion of financial services in the Transatlantic Trade and Investment Partnership (TTIP), which the US is firmly against.

Hill’s career as a lobbyist and founding his own consultancy also drew attention from MEPs. He said he had got rid of his shares in his old company in “less than a day” after his nomination.

Background

Jean-Claude Juncker, the new President of the European Commission, announced the distribution of portfolios among his new team on 10 September.

Among the new Commissioners, due to take up their posts on 1 November, are 18 former (prime) ministers. The President has announced that the new Commission will be "very political".

The new Commission must now be approved by the European Parliament, who will interview the commissioners between 29 September and 7 October.

During these two weeks of hearings, the 27 commissioners will be interviewed by MEPs from relevant parliamentary commissions.

Parliament can then accept or reject the whole team.

Timeline

  • November: Juncker Commission scheduled to take over
  • May 2015: UK general election
  • 2017: Possible date of Brexit referendum

Further Reading

European Parliament