European institutions threaten to reject treaty on members’ finances

THE battle to devise an EU treaty governing member states’ finances faces a new hurdle with both the European Commission and the European Parliament threatening to reject it unless they have a role.

The latest draft has been significantly watered down — reducing the chances that Ireland will have to hold a referendum and increasing the likelihood that Britain may sign up to it. However, clauses giving a greater role to the EU’s institutions have disappeared, leading to MEPs and the Commission warning that it could weaken the union.

Commission president Jose Manuel Barroso said they could only support it if it was fully compatible with EU treaties and the community method — where the commission acts on behalf of member states — as well as being seen as protecting smaller countries.