Select Committee on Treasury Minutes of Evidence

Examination of witnesses (Questions 140-148)



Mr Davey

  140. Can I come back to the subject that the Chairman and I were discussing at the beginning of the session. The European Commission has proposed creating a subgroup of the Economic and Financial Committee to aid the Eurogroup. What is the UK Government's view on this proposal?
  (Mr Rogers) If I may just answer that. We have clearly no problems with that providing that on all issues which concern us, and in the preparation of Ecofin and indeed of Eurogroup, the meeting is at 15 which it is.

  141. Can I just check what you are saying there. If there is a group set up, under the auspices of the Economic and Financial Committee, to aid the Eurogroup, that is the 12 not the 15?
  (Mr Rogers) Yes. It will be at 15.

  142. I beg your pardon?
  (Mr Rogers) It will be at 15 at preparatory level, so British officials will be present.

  143. But the Eurogroup is 12 Member States who have the euro as a currency.
  (Mr Rogers) Yes.

  144. As I understand it, the Commission's proposal is to set up a group that will support and aid meetings of the Eurogroup to which the UK is not a member. That is the proposal.
  (Mr Rogers) Yes, but, as I recall, there is no clarity in that proposal which in various respects has met with a fairly dusty answer from several Member States. There is no clarity as to the composition of that committee but what is very clear is that there is every disposition on the part of all Member States that all preparations, including for Eurogroup, should remain at 15 as they are at the moment. All preparations of all Ecofin and Eurogroup discussions remain at 15 and we are present throughout.

  145. So if that proposal went forward there would be a sub-group of the Economic and Financial Committee which would have input from all 15 Member States for documents servicing a group called the Eurogroup which only represents 12 Member States. Is that what you are saying?
  (Mr Rogers) I do not think there is tremendous clarity on the extent to which the current arrangements, which are extremely informal— There are very few documents, there are no minutes of Eurogroups from which we are excluded in terms of seeing them. This is a much more informal set-up than Ecofin, not least, as Ministers have explained, all formal decisions are taken entirely by the Council. If anything, there has been in our view, and in the view of some members of Eurogroup I imagine, rather too scanty preparation of Eurogroups and our general view is that sometimes they would benefit from greater and more detailed preparation and occasional detailed documentation. Not the sort of documentation we have to prepare for Ecofins but, nevertheless, occasional short texts. We are relaxed about that but only providing that all preparation is done in the same composition at the EFC as it is currently done.

  146. I think that was a yes. I think what you are saying is that the UK is happy for a new sub-group to be set up to provide better quality information for the Eurogroup. Is that what you are saying?
  (Mr Rogers) Yes. Clearly we want the Eurogroup to function as well as it can in dealing with all matters that are appropriate for the Eurogroup to deal with consistent with the Luxembourg Agreement about what the division of labour between the Eurogroup and Ecofin should be. So providing that Agreement remains intact, which it does and no-one questions it, and there is a clear distinction between those matters that are appropriate for Eurogroup discussion and those that are appropriate for Ecofin discussion, we have no objection, on the contrary, to the idea of preparing Eurogroups better and making them a more effective forum for dealing with the business that Eurogroups should transact.
  (Miss Johnson) Those preparations and decisions are being taken by the full 15.
  (Mr Rogers) Exactly.

  147. My concern on this is that the UK obviously is not at the table when the Eurogroup is having its discussions and, while I take the point that we want the Eurogroup to have its discussions armed with the best quality of information, the question is will that quality of information and will those discussions consider the UK interests as well? Mr Rogers has said that there will be UK input to those documents going to the Eurogroup, which is reassuring to an extent, but the negative side of this surely is that the Eurogroup is now becoming a more substantive group with a bureaucracy of its own and, therefore, if it is getting that role surely you are stepping up its influence, stepping up its position, and the UK is excluded from that?
  (Miss Johnson) I think I already answered this main point earlier on. I will just go over it again. The fact is that Ecofin has the central role in policy co-ordination and it maintains that central role. We have been perfectly relaxed, and indeed we are perfectly relaxed, to see that the Eurogroup themselves have a better informal organisation and they have better visibility and, in this case, more provision of information. Were there to be anything that would in any way threaten Ecofin's status and its lead in a decision making role, we would resist it. We do not perceive that there is anything of this nature and indeed, as I say, if you are involved in Ecofin meetings you feel very much that we are at the heart of things and a key player in Europe.

  148. There is now this Eurogroup discussing economic policy in Europe, maybe issues which are not formally required to be discussed at Ecofin. Now with the groups of officials meeting potentially on a more formal basis to provide support we suggest a more formal role for the Eurogroup and the UK again is outside that. I am surprised you are not more worried.
  (Miss Johnson) The role of the group is set out vis à vis Ecofin's role. The inter-relationship of the two is not going to change. There are no proposals for change. Indeed, you are speculating about what might be the case to try and make the suggestion that there is some kind of problem here. We are confident that what is being discussed in the Eurogroup is what is appropriate for the Eurogroup to discuss and indeed, as I said, we welcome that. We think that the higher visibility and the well functioning of that group is useful and all matters that do relate to Ecofin are coming to the actual Council meetings. I cannot really add anything to it, I think we are going round the same circuit otherwise.

  Mr Davey: Thank you.

  Chairman: Thank you both very much.

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