Eurobloat #0036 • April 2013
April was the month the Union reached past national capitals to set bankers' pay, watched its flagship carbon scheme slide towards worthlessness, and found time to ponder the correct vessel for table oil. A productive thirty days for everyone except the people who pay for it.
Folly of the Month: The City told what to pay, whether Britain likes it or not
On 16 April the Parliament approved the CRD IV package, complete with a hard cap fixing banker bonuses at one year of salary, stretchable to two only with a shareholder vote. The detail that matters is constitutional rather than financial. Britain was outvoted, and a pay rule for a London industry was now written in Brussels and imposed on a member state that did not want it. The Commission calls this a single rulebook. The plainer word is that your national parliament no longer decides, and a qualified majority of other governments does.
1. The carbon market the EU built nearly priced itself at zero
On the same 16 April the Parliament rejected the Commission's plan to prop up the Emissions Trading Scheme by withholding 900 million permits, by 334 votes to 315. The price promptly fell to a record low of under three euros, less than a third of where it began. A flagship Brussels invention surviving only on emergency rescue is not a triumph of design.
2. Brussels learns how to pour olive oil
A measure surfaced this spring requiring restaurants from January 2014 to serve olive oil only in pre-packaged, tamper-proof, factory-labelled bottles, banning the humble refillable jug. After the Telegraph revealed it and a continent laughed, the agriculture commissioner withdrew it for lack of "widespread support". One wonders how it ever got as far as it did, and how many similar items did not reach a newspaper.
3. The privacy reform that drew four thousand amendments
Brussels spent April wrestling its draft data protection regulation, into which lobbyists and members had poured more than 3,000 amendments, so many that the committee shelved its end-of-April vote and asked the rapporteur to boil the lot down to about 100 compromises. A single EU-wide rulebook for every byte processed across the continent was always going to attract this circus. The lesson nobody drew was that the appetite for one all-encompassing scheme was the problem, not the lobbying it invited.
4. Cyprus, where small savers learned what a bailout means
April was the morning after the Cypriot rescue, in which the Eurogroup, Commission and ECB closed Laiki Bank and seized a large slice of uninsured deposits at the Bank of Cyprus. Depositors discovered that the promise of safety extended only to those Brussels chose to protect. The precedent that creditors and savers, not taxpayers elsewhere, would now pay was sold afterwards as a feature.
5. The Brussels deal with Belgrade and Pristina
On 19 April, after the tenth round of EU-brokered talks, Catherine Ashton announced a fifteen-point agreement between Serbia and Kosovo, the down-payment on yet more enlargement. The Union that cannot govern the members it already has was busy lining up the next ones, with accession talks the prize. More Europe, always, regardless of whether the existing Europe works.
6. The directive to tell you how dirty your fuel is
Through April the Commission kept stalling its Fuel Quality Directive, which would brand Canadian tar-sands oil with a higher emissions value, after years of lobbying from Canada and from a UK keen to avoid it. An impact assessment was the chosen instrument of delay. A rule the Commission cannot bring itself to enact, yet will not abandon, is the worst of both worlds.
7. Britain sues to stop a tax it never voted for
This month the Chancellor lodged a legal challenge at the European Court of Justice against the Council decision letting eleven member states press ahead with a financial transaction tax under so-called enhanced cooperation. London's objection was the extra-territorial reach, a levy designed by others that would still bite on British trades. A bloc that has to be taken to court to stop it taxing the citizens of a state that opted out has rather given the game away.
8. Payments to governments, now reportable by decree
In April the Irish presidency secured agreement on a new accounting directive forcing extractive and forestry firms to report, country by country, the taxes, royalties and licence fees they pay to governments. Transparency is the marketing. The substance is one more uniform reporting burden written in Brussels, applied to every company on the continent, with the paperwork falling on business and the credit claimed by the institution that imposed it.
9. The wattage of your vacuum cleaner, under review
The Commission spent 2013 finalising ecodesign and energy-labelling rules for vacuum cleaners, capping motor power and grading the household appliance like an examination paper. The official concern was a few kilowatt-hours per home. The revealing detail is that an institution facing a collapsing carbon market and a deposit-grab in Cyprus still found officials to regulate how hard your cleaner may suck.
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