3. 4. 201218:59

10 theses from the Prime Minister on the future shape of Europe

Lecture by Prime Minister Petr Nečas on the occasion of his joint appearance with Federal Chancellor Angela Merkel at the Law Faculty of Charles University on 3rd April 2012.

Dear Madam Chancellor, Your Magnificence, Spectabilis, Ladies and Gentlemen, dear students.

It is today a genuine honour for me to be able to appear here at the collegium maximum of the Law Faculty at Prague, the oldest institution in Central Europe for the teaching of the law. Today's meeting is devoted to the future of Europe and European integration. I will try to be as brief as possible, so as to leave time for discussion. I will therefore outline several key theses in which I will attempt to oppose certain established clichés and at the same time to outline my own vision of future trends.

1) My first thesis is that European integration was from the beginning and should remain, a political, and not just an economic project.

It often appears that that there is some kind of discrepancy between the idea of the internal market and the idea of closer political union. Allegedly there is a difference between the original "simply" economic integration and the more recent, so-called "now" political integration. In reality the idea of European integration was a political project from the beginning.

By creating a space for free trade without barriers, followed by the system of the classical four freedoms, Europe was to be linked together so that its peaceful development was assured. One should not therefore seek a rift between economic and political integration.

2) My second thesis is: Instead of fighting fires we need to focus on preventing them, based on strategic political decision-making.

A problem of both the past and the present is that closer integration has occurred as a result of certain apparently automatic pressures, on the basis of ad-hoc necessities. The consequence of one directive was the need to adopt another one, which then led to the need to open up primary law.

However this model, defined in functional terms, has its limits when it starts to invade those core areas of the jurisdiction of the state such as its choice of an economic and social model or its foreign and security policies.

Any discussion on transfers of authority should be conducted on the basis of clear political deliberations and a long-term vision of what is to be achieved. Decisions should not merely constantly react to current short-term problems but should be taken with regard to long-term structural needs. This also applies to the current attempts to resolve the crisis in the eurozone.

3) My third thesis is: The currency union will need to integrate further in order to survive.

The causes of the present crisis far from lie only in the irresponsible behaviour of governments which incurred debt and the banks which lent to them.

The problem lies much deeper than this, in the very structure of the European economy and its continually declining competitiveness. If an economy is competitive it has the trust of the markets and of investors.

In this case a certain level of indebtedness need not be a problem. Of course this does not mean I am enamoured of large deficits and debts. I only want to say that the key element is not fiscal policy of itself, but economic policy and the maintenance of competitiveness. It can be seen that the creation of a currency union which was not a fiscal union, and not a true economic union either - if you will, we can speak of a union of competitiveness - was not the right step. However the solution to this now cannot be the breakup of the eurozone, but must be a shift towards further stages of integration.

4) My fourth thesis is: A uniform model of the same degree of integration for all the states of the European Union is questionable.

If the eurozone today must integrate further, this of necessity means a shift towards a Europe of one of several integration models. I am deliberately avoiding using the term a two-speed Europe. This is not a question of speed, nor of division into two groups. Far more apt is the concept of so-called variable geometry. That is, integration with a single common foundation which applies for everyone and a series of supplementary areas always shared by various groups of states in line with their needs and wishes. It is clear that the members of the currency union have a greater need for coordination of economic and fiscal policies than the other countries. It is wrong for them to be held to ransom by a non-member of the eurozone who is less well disposed towards further integration.

But at the same time it is wrong to pressurise such a state if it does not feel - equally legitimately - the need for integration of the type in question.

The same applies also in other areas, be it Schengen cooperation, the modification of the Single Act or the integration of family law. It is thus entirely legitimate if in some areas certain states intend to continue further in harmonisation and coordination than others, without anyone prevent them from doing so. It is only important that in this they do not disrupt the cooperation between the whole of the current EU-27, to be expanded in the future, particularly in respect of the internal market.

5) My fifth thesis is: There should be a deepening of the internal market as the basis of the idea of integration.

As I have said, the idea of an internal market without barriers is motivated not only by economic interests, but has in itself a deep political message.

For that matter, the idea of integrating Europe was based on this from the beginning. The internal market is precisely that foundation which must be shared by the entire EU-27 in the same form.

In recent years it appears that here the European Union has slightly lost its way. The liberalisation of services remains on paper to a large extent, as does the liberalisation of the energy sector. Instead of eliminating administrative and regulatory barriers we are still creating Union regulations without monitoring their economic and financial impact. Moreover the spirit of protectionism returns to the Union from time to time, often in the guise of so-called reciprocity. Initiatives such as “buy American”, “buy Asian” and the like should not of course meet with a European Union response in the form of a “buy European” slogan. Our aim must not be an inward-looking and slowly declining European space. Our aim must be to promote the idea of free trade.

6) My sixth thesis is: The instrument of further integration ought to be coordination, rather than harmonisation and transfers of authority.

I am of the opinion that harmonisation steps should only be focused on clearly defined areas of the internal market. Here transfers of authority were and can be essential. By contrast, in other areas of integration, be it economic policy and employment policy, social policy, support for science and research and other spheres, the coordination method is a much more appropriate way forward. In other words, there is a need here not to harmonise legal regulations, but to bring together and coordinate policies, without states having to give up their authority.

At the same time it is important that it is the member states which jointly decide on which areas are to be coordinated, and how. The coordination route can also be a kind of compromise between the so-called community and inter-governmental methods. For that matter several years ago Chancellor Merkel quite correctly pointed out that the most appropriate term for denoting the post-Lisbon decision-making standard in the European Union was the label "the Union method". To call today for the strengthening here of the community method, there of the inter-governmental method, is now outdated in terms of the labels used.

Sometimes it is the integration route which is appropriate, at other times harmonisation, and again at other times coordination. It is nonsense to affirm that one route is always the right one, and another always wrong. The European Union and its individual policies are too varied for it to be possible to submit them all to a single form of decision-making.

7) My seventh thesis is: It is wrong to view the future functioning of European Union institutions through the lens of a state form.

The institutional system of the European Union should not abstractly copy the constitutional systems of the member states and their decision-making mechanisms. Rather than a rigorous division of power between the legislative and executive functions, I consider it key in the case of a supranational system to separate originating political power on the one hand and derived administrative power on the other, or to be more precise, to separate the decision-making element of the institutions primarily representing the states (I have in mind the Council and the European Council) from the institutions derived from them, with the European Commission the first of these.

Here the European Parliament also plays its own important political role, but I regard this - as does the judicature of the German Federal Constitutional Court - as being supplementary. In my opinion in its position the European Parliament cannot secure legitimacy of decision-making, since it does represented a demos constituted around certain common themes. But of course on the other hand it can contribute to the transparency of the legislative process.

To design the functioning of the EU based on a model of the states would be a mistake simply with regard to its very size. Citizens are much better able to take responsibility for the operation of a structure where they are able to see the impact of decision-making in which the public plays a genuine role. In too large a structure the possibility of the genuinely democratic application of power and democratic supervision must of necessity decline. Here in theory there is increased scope for the dominance of an unelected bureaucratic apparatus, but as well for the frustration of citizens who are not able to perceive decisions coming "from above" as their own, as legitimised by them. I do not mean by this that decision-making in the Union is undemocratic.

I only assert that in order to secure democratic legitimacy it is necessary to involve the member states and their own European institutions.

8) My eighth thesis is: The European Council should play a key part in strategic decision-making in the EU.

It is of course nonsense to regard some Union institutions a priori as "good" and others a priori as "bad". Sometimes one hears it said that the European Commission is the ally of the smaller states and that the European Council by way of contrast is their enemy. In reality these individual institutions are complementary to each other. The European Commission should play the part of an administrative and executive apparatus making its decisions on technical grounds. The European Parliament should concentrate on its legislative work and supervising the executive, without of course itself become involved in executive activity.

A key role in strategic decision-making should then be played by the European Council, which is the only one able to achieve final agreements and compromises on the most difficult subjects.

9) My ninth thesis is: There is a need to prevent the domination of administrative power over political power.

There is a need to prevent key decisions being in the hands of unelected bodies and administrative units, whether this be at European Union level or that of the member states. The legitimacy of administrative decisions must follow from political decisions, and not the reverse. It is not the bureaucratic apparatus which can decide on what is good for the citizens and states of the Union, they themselves are those citizens and states, acting with the help of elected representatives.

But of course there is another consequence to this. As the European Union becomes more and more part of internal politics and its behaviour not bound by diplomatic protocol, we ourselves should be determined to act more politically. Individual states legitimately defend the diverse interests of their own citizens. For this reason also the creation of ad-hoc coalitions between states is becoming a natural part of life at European level. But even so we must also be more candid with each other. It should no longer be taboo to express criticism of a member's policy, just as we do in national political disputation. I am of the view that this is more transparent and fairer.

10) I come to the end of my speech and with that, to my tenth thesis. The European Union is not the only expression of the European identity. It is not an end in itself, but a means for achieving shared goals.

Taken this way it is a community defined by its aims and its purpose. However, this does not in any way reduce its value or its significance. Integration into Europe is without any doubt the destiny of the Czech Republic. We rely on cooperation with the other states of Europe. It would however be a mistake to dig an ideological trench between the European Union and its member states. To see the principle of statehood and the principle of European integration as being mutually incompatible. To regard the Union as the antipodes of the states and the states as enemies of the Union. So the European Union for me is and always will be a community in which we live our lives and in which we have our future. I see nothing disparaging or negative in making this statement.

On the other hand these states cannot today manage without the Union and the closest, mutual cooperation is logically in their interest.

The principal discussion today should no longer be the question of whether we need the Union and integration, of whether we want, or do not want, to be within it. This question has now been resolved and I still do not understand why each substantive debate over the future of Europe is reduced to just this. As if society is only divided into supporters and opponents of the European Union. Today European integration is an entirely natural part of our world, where it makes no sense to cast doubt on its raison d'?tre or indeed to call incessantly for it to be reaffirmed. It is far most important to focus on how to improve its functioning, its effectiveness and efficiency and how at the same time to strengthen the legitimacy of its decision-making.

Any step taken by the European Union or any of its institution is not a priori correct simply because it is "European", nor is it a priori wrong for the same reason. We need to look at events within the Union pragmatically and without ideological prejudices, just as for that matter we look at events in any other community.

I thank you for your attention.