Thatcher-style, Cameron says: We won’t pay

Margaret Thatcher.jpg

UK Prime Minister David Cameron can claim a victory at the 16-17 December summit which perhaps went unnoticed by the general public but was considered resounding by experts: the summit conclusions state that Britain has secured other EU countries' agreement that London will not contribute to future bailouts.

The text adopted today (17 December) states that Article 122 of the Lisbon Treaty, the legal basis for providing aid to Greece and Ireland, will "no longer be needed" to put together bailout funds. The text is applicable to all 27 EU members.

"Heads of state and government […] agreed that it should not be used for such purposes," the conclusions read.

Instead, the new solidarity mechanism only requires contributions on a voluntary basis by non-eurozone members. The details of the mechanism will be fine-tuned by EU finance ministers in March 2011.

The conclusions, according to experts, should be seen as an assurance for London that no matter what the circumstances it will not be required to pay for a common bailout effort.

The above sentence does not appear in an earlier version of the conclusions and is seen as a last-minute breakthrough for London. The development comes in handy for Cameron, who had been accused by the British Eurosceptic press of allowing the UK to get sucked in to eurozone mechanisms.

EURACTIV asked permanent Council President Herman Van Rompuy and European Commission President José Manuel Barroso whether the sentence in the summit conclusions could be philosophically compared to the British rebate, negotiated in 1984 by then UK Prime Minister Margaret Thatcher.

"Philosophy of course is my core business," Van Rompuy answered amid laughter. "Besides theology," he continued to more laughter, as the former Belgian prime minister is known as a devout Catholic with clear views on ecclesiastical matters.

But Van Rompuy preferred to refer to the future battle over the EU's long-term budget, saying that the summit had done nothing more than confirm the conclusions of the October summit.

"And if letters come, we are very polite people, we read our letters," Van Rompuy said, referring to indications that Cameron and other leaders would soon sign a letter demanding that the future EU budget be capped.

Barroso was in good humour too. He said he had also undertaken "some studies in philosophy," but "not in as much depth as Herman". However, the Commission president dismissed suggestions that the decision taken could be compared to the 1984 Fontainebleau summit.

"There is something I learned in French: Le mythe de l’éternel retour [a masterpiece by Romania-born philosopher Micea Eliade]. There is the possibility of the 'retour' of some myths regarding the budget in the discussions," Barroso said.

At a separate press conference, UK Prime Minister Cameron said: "I've been able to protect Britain from having to bail out the euro zone from 2013 and saved UK taxpayers millions. Britain will not be affected."

"The new stability mechanism is for member states whose currency is the euro. It's by eurozone members, for eurozone members. Britain has secured a black-and-white agreement that it won't be called upon to bailout the euro zone in 2013," Cameron added. 

The UK will nevertheless remain part of the emergency mechanism set up to bail out Ireland and Greece until 2013, when the new system is expected to become operational.

"It is of course frustrating that thanks to the previous government we are still a part of the emergency mechanism," Cameron declared.

Asked by EURACTIV to comment on Cameron's performance at the summit, Piotr Kaczy?ski of the Centre for European Policy Studies (CEPS) said that Cameron could hardly claim victory as the vast majority of EU members had rejected his attempt to link the treaty change needed to put in place a permanent bailout mechanism to the long-term EU budget.

"Clearly, the British did not get what they wanted," he said.

This article was published in cooperation with EURACTIV France.

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At a summit in October, France and Germany proposed setting up a permanent system to handle crises in the euro zone, admitting it would mean changing the EU treaties.

On 1 December, the European Commission outlined details for a eurozone permanent strategy to help countries at risk of defaulting on their debts.

Details of the proposal were debated on 16 December, at the European leaders’ EU summit.

Separately, IMF head Dominique Strauss-Kahn criticised the EU's piecemeal approach to rescuing the euro currency from contagion as ministerial talks earlier this month (7 December) gave no succour to countries with worsening sovereign debt problems.

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