Britain could be forced to accept EU vetting of budget
Quote:The European Commission has decided David Cameron will not be able to veto controversial demands to see the Chancellor's plans before MPs.
The decision on whether to introduce the measure will passed by a simple majority vote – leaving Britain isolated.
At his first Brussels summit next Thursday, the prime minister will be told by Herman Van Rompuy, the EU president, that other European leaders have accepted the idea despite British opposition.
Under the new "budgetary surveillance" proposals, key elements of Britain's budget would have to be submitted to the EU for "peer review" before is presented to the House of Commons or the public.
Treasuries will be required to hand over, "well in advance", key budgetary information such "total revenues, total spending and deficit targets" to be debated by other European finance ministers and officials before they are presented to national parliaments.
During the process, according to Mr Van Rompuy, there would be time "to adjust the plans before the final budget is presented".
During a verbal report back on the progress of his "economic governance" task force, created by an EU summit before British elections, Mr Van Rompuy will say that Germany, France, Italy, Spain, Poland and most other countries support the measure, aimed at preventing further euro zone debt crises.
The President of the European Council, the EU's highest body that brings together Europe's heads of state and government, is then expected to set an October deadline for legislative proposals, to be drafted by the Commission.
The Daily Telegraph understands that the commission is currently planning to pass the legislation to create the budget "peer review" system on the basis of qualified majority voting (QMV).
Under this procedure, Britain would not be able to veto the proposal and without the support of Germany, France, Italy, Spain or Poland, Mr Cameron cannot muster a blocking minority.
"The proposals, which came from the Commission, are based on existing treaties. Some of the sanctions are only for euro zone countries. Other measures, like the peer review, are for everyone. The decision will be taken by QMV," said an EU source.
"If Britain cannot stop or change this proposal before October it will be too late because it can be outvoted."
The British argument that, because Mr Van Rompuy's task force is composed of national finance ministers, the decision on budgets will be taken by unanimous consensus has been dismissed.
"The task force does not replace the legislative process. It just speeds up the political agreement before legislation is proposed by the Commission," said a diplomat.
A British diplomat said that “no decisions have been taken” and that Britain broadly supported the other EU measures to tighten up budgetary discipline.
”We have been and will continue to be very clear that we're not prepared to submit a draft budget to the European Commission. The UK budget will continue to be presented to parliament first,” he said.
”Ultimately, this is just one idea for a solution to a much bigger challenge - how we prevent a future economic crisis in Europe - so we're going to need a number of measures and we've got to get this right and ensure that all member states are happy with the outcome.”
Bill Cash, a Conservative MP, said that if an EU vote was taken the Commons would have to act to preserve its "power of the purse" over budgets, a key plank of parliamentary sovereignty.
"These proposals must be rejected. If there is any attempt to use QMV not only must the UK vote against but measures would have to be taken by the parliament to maintain the sovereignty of Britain," he said.
Mats Persson, the director of the Open Europe campaign group, said: "Bulldozing over Britain on a matter of economic and parliamentary sovereignty at this sensitive time would do nothing to improve EU-UK relations. It also runs counter to the constructive sprit now needed to save the euro zone and get Europe's economy back on track."
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