Czechs deeply divided on EU’s fiscal union

Foto:Europäische Kommission

The question whether or not the country should join the emerging EU fiscal union has divided Czech politicians and appears to be fraught with problems. While one governing party is in favour of an emphatic “yes”, and the country’s eurosceptic president has already voiced an emphatic “no”, everything points to the fact that Czechs will continue to sit on the fence for as long as possible.

Vít Bárta
An attempt to formulate an official Czech stand on whether the country should join the emerging EU fiscal union has fully revealed the depth of controversy on the issue. While the ruling Civic Democrats and Public Affairs would prefer to see the matter decided in a national referendum, the third party in government TOP 09 accuses them of refusing to accept political responsibility for a decision that is “too complex” for the electorate and should rightly be made by Parliament.

Following Wednesday’s vote in which the government provisionally endorsed a national referendum on the issue, Vít Bárta of Public Affairs explained why the junior coalition party had thrown its weight behind the Civic Democrats in favour of a referendum.

Miroslav Kalousek
“Joining the fiscal union would mean ceding more powers to Brussels and would significantly reduce citizens’ rights in consequence. If the country is to set out on this road it is only right and fair that the decision should be made by the people.“

The ruling TOP 09, which opposed the move, has accused its coalition partners of harming the country’s interests abroad. The party’s deputy leader, Finance Minister Miroslav Kalousek says the Czech Republic would have no problem adhering to the rules of the EU fiscal union since its fiscal discipline is already more stringent that that currently outlined in the treaty and that endorsing the agreement would show the Czech Republic to be a reliable partner.

“The Czech Republic is a member of the European Union and as such it has partners in the alliance. It is in our best interests for our foreign policy to be transparent, for our partners in the EU to know which way the Czechs are going to move -whether they will give the fiscal union a clear “yes” or a clear “no”.”

Photo: European Commission
Although the cabinet has now officially concluded that it wants to leave the decision to the electorate, both TOP 09 and the opposition Social Democrats have made it clear they would not support a one-off referendum bill on the fiscal treaty in Parliament. This would leave the Civic Democrats and Public Affairs in the unenviable position of petitioning the Communists for support and possibly trying to break the ranks of the other two parties.

To make matters worse, the government’s hands may be tied by the country’s Eurosceptic president and his outright rejection of deeper EU integration. International treaties must be endorsed by the head of state and Prime Minister Petr Nečas said on Wednesday that an analysis of the Constitution showed that in order to negotiate signing up to a treaty which would entail relinquishing a degree of national sovereignty to Brussels the government would need special authorization from the president. The prime minister noted that knowing the president’s views it would be illogical to expect such authorization for the remainder of his term in office - which ends in March of 2013.

Petr Nečas
However the prime minister did not appear greatly put out by this complication. He has repeatedly pointed out that it is premature to debate the country’s stance to a fiscal union until the conditions of such a deal have been definitively agreed. And even then, he argues, it would not be pertinent unless the Czech Republic actually joined the euro-zone, a prospect that has become increasingly hazy of late.

At a time of growing economic uncertainty, there are many who see considerable advantages in lying low until the storm clears and with political forces pulling in both directions it is increasingly likely that the prime minister’s cautious, middle-of-the road policy will prevail.