Austria minister ‘cannot imagine’ an agreement at EU summit

Karoline Edtstadler, Austria's EU minister on the recovery fund: "Where is it written that it must be €750 billion? We are not the only state that says: 'That is too much.'" [BKA | Andy Wenzel | EPA]

Austria’s EU Minister Karoline Edtstadler does not expect an agreement to be reached at the EU’s budget summit on Friday and Saturday. In an interview with EURACTIV Germany, she explains where Austria wants to renegotiate and pleads for a stricter link to the rule of law.

Karoline Edtstadler (ÖVP) has been Austria’s minister for the EU and constitution since January 2020. In the previous government, she was a state secretary in the Interior Ministry. Edtstadler has also worked as a legal assistant at the European Court of Human Rights and as a criminal judge on the Salzburg Regional Court.

On Wednesday (15 July), you will discuss the proposal put forward by the European Council President Charles Michel on the EU budget and Recovery Fund. Does Austria find its demands reflected in this proposal?

Intense negotiations are certainly still needed. We are talking about the largest budget ever.

It is true that Austria insisted from the outset that the money be earmarked for a specific purpose. They are to flow into areas that will make Europe stronger for the future: digitalisation, greening, general resilience (e.g.: reforms).

We also insisted on a time limit on the availability of the funds, because we want to get out of the crisis quickly. These two points have now been discussed by everyone, and some of them have been taken into account in the new proposal.

But I cannot imagine that there will be an agreement at the weekend. The positions are still too far apart. What still needs to be intensively negotiated is the question of the relationship between grants and loans, and in this context, the amount of the reconstruction fund. Where is it written that it must be €750 billion? We are not the only country to say that this is too much.

You are referring to the “Frugal Four,” Austria, Sweden, Denmark and the Netherlands. Are you still closely coordinated on these issues?

Yes, but also with other states, such as Finland. The Frugal Four already had a coordinated position at the last EU Council. This is unchanged.

Dutch Prime Minister Mark Rutte recently met Emmanuel Macron and Angela Merkel, who both want a generous recovery fund. Did Rutte speak for all the Frugals there?

I can’t tell you what Prime Minister Rutte discussed. Who talks to whom bilaterally will be less important than the 27 sitting around a table and negotiating at eye level. You have to look at the situations of the states: geography, finance and how they’re affected by the pandemic.

Austria’s financial situation is good compared to other EU countries, but the new budget proposal again provides for rebates for Austria’s budget payments. Why?

We want to see a substantial net discount, in a corresponding dimension. We pay considerably more into the EU budget than we get out of it. Here, discounts create a balance. That corresponds to my understanding of fairness. The level of discounts will certainly be another point of discussion.

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You always emphasise your support for linking the EU budget to rule of law criteria. Does the Michel proposal go far enough here?

What the proposal says is the least we can do. If it’s more, I’d like it even better. I have always been in favour of the Commission being able to stop spending when member states move away from the rule of law. That is in the proposal, but it could be even stronger if, for example, sanctions could not be decided by qualified majority but, conversely, only rejected by qualified majority. In tomorrow’s Council of EU ministers, I will advocate the strongest possible dovetailing of the budget and the rule of law.

The current Michel proposal only measures the rule of law by whether EU funds are being used correctly, not by criteria such as the independence of the judiciary or clean procedures. Has an opportunity been missed here?

Rule of law criteria should also ensure that the rule of law applies in a member state. If deficits are identified here, it should be possible not to disburse funds. It should not only be a question of where EU money goes, but also of the overall situation. That is why the Commission will soon present its first report on the rule of law in respect to all member states.

Will the information from this monitoring be included in the Article 7 proceedings, for example currently against Poland and Hungary?

We will probably discuss this report after it has been presented in autumn, at which time we will have to see how to deal with individual states where deficits are revealed. The report on the rule of law has no effect on the current Article 7 proceedings, which has already been initiated.

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Are you optimistic that the enlargement talks with North Macedonia will start in 2020?

Yes. North Macedonia in particular has achieved incredible things, such as the change of name. Albania still has a few things to do.

You are strongly committed to amending the EU Treaties, including through the Conference on the Future of Europe. Where is the path leading?

We now have the opportunity to learn from the crisis and to put Europe in a stronger position for the future. In the Council, I have fought hard for a mandate that at least does not rule out treaty changes. Austria is even more ambitious and wants a new treaty.

In this treaty, it would be possible to agree to solve the big issues together and the small issues in the regions, without Brussels and Strasbourg having to provide guidelines.

Furthermore, it could be discussed whether the European Parliament really needs seats in Brussels and Strasbourg, also in the sense of the Green Deal. Unanimity will also be discussed, as it now only exists in two areas anyway. In financial matters, states must remain sovereign, but when it comes to foreign and security policy, Europe needs a stronger external image.

[Edited by Zoran Radosavljevic]

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