The recently agreed package of legislation on financial supervision may resurface on 7 September, when the EU’s finance ministers reunite in Brussels for their first meeting after the summer break. According to one senior source, ministers will be asked to give their “definitive accord” to the package, just days after a delicate compromise was agreed with MEPs that should see four new EU-level watchdogs up and running by January 2011. The ministers’ seal of approval is necessary because although they shifted position at a July meeting, giving ground on which key powers to cede to the watchdogs, there are technical changes agreed on 2 September that have yet to be signed off.

However, the item is not formally on the agenda that has already been dedicated to talks on bank levies, transaction taxes and overhauling the Stability and Growth Pact.

EU leaders agreed in June - after two Commission communications on the subject ⁽¹⁾ - to shift their budgetary timetables to allow their European counterparts to scrutinise spending and revenue outlines before the full budget is set in stone and approved by national parliaments. This so-called ‘European semester’ - which will kick off in mid-to-late April each year - is to be discussed and formally signed off by finance ministers on 7 September. “Instead of acting ex-post and waiting until things turn sour, we will be acting ex-ante,” said one EU diplomat. The proposal had raised eyebrows, especially in London, where the new administration insisted it would not be revealing its budgetary plans before they were signed off by Westminster.

LEVIES AND TAXES

The second subject on the agenda is how to make the financial sector pay for the crisis, with a Commission non-paper (see Europolitics4033) forming the basis for the talks. The text narrows down the options to two: a bank levy (or financial activities tax), which is a charge on banks’ balance sheets or staff pay, and a financial transaction tax, which penalises the trade in currency, derivatives and any other financial products that are exchanged on the market. While there are no positions set in stone - one EU source said ahead of the meeting that the debate was “very open” - there seems to be more opposition to a transaction tax than there is to a bank levy. In fact, France, Germany, the UK and Sweden have already introduced or plan to introduce the latter, while Austria and Belgium are more in favour of the former.

OTHER ITEMS

A meeting of the 16-country eurozone will take place after the Ecofin meeting, in change to the usual running order. This is to make time for the 27 ministers to meet on 6 September with European Council President Herman Van Rompuy, who will brief them on progress made in his special task force on economic governance, and to prepare the ground for an agreement on the ‘European semester’, on 7 September.

⁽¹⁾ COM(2010)250 and COM (2010)367