EU summit ends with disagreement over competitiveness contracts
European Council lays out next steps on banking union, greater economic co-ordination.
Arguments over the nature of competitiveness contracts and a ‘solidarity fund’ that could support them dominated the second, final day of a summit of European Union leaders in Brussels.
The fund – originally a German idea to deflect pressure for any mutualisation of national debt – is supposed to assist countries as they undertake structural reform, helping them to finance such measures without fears that this would drive up their fiscal deficits. But it is unclear how the fund – which Angela Merkel, Germany’s chancellor, said would be worth some €10 billion-€20bn – would be financed and whether it would be managed by the Eurogroup (the eurozone’s finance ministers).
The leaders have further watered down plans for contractual arrangements between member states and the European Commission, in which national governments are supposed to set out the structural reforms they pledge to undertake in return for assistance.