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Vice-President of the European Commission Responsible for Interinstitutional Relations and Administration

Lisbon Treaty - two years after its entry into force

College of Europe, Bruges

Bruges, 10 February 2012

Ladies and gentlemen

I am delighted to be here today at the College of Europe to talk about the state of the EU two years after the entry into force of the Lisbon Treaty.

In those two years, we have seen profound changes in the EU, as the impact of the sovereign debt crisis has taken its toll. The crisis has shown us that the strong, dynamic, reactive and cooperative institutions foreseen by the Lisbon Treaty are now more necessary than ever if the EU is to weather not only the economic storm but also the political one.

I will discuss the response to the crisis in greater detail in a moment, but let's first spend a few minutes reflecting on what Europe was like prior to the Lisbon Treaty.

It's hard to believe that it was only 10 years ago – at the EU summit in Laeken, here in Belgium – that EU Heads of State and Government agreed on the need to overhaul the European Union's institutions and legislative procedures. Hard to believe because this, let's not forget, was barely three years before the biggest ever enlargement of the European Union, that would nearly double the size of the EU and bring, for the first time, deep differences in economic and political development within the Union. Faced with this major challenge, Europe needed institutions and procedures that were fit for purpose, and needed them quickly.

To give you some context, in 2001, decision-making in Council was still hampered by the need for unanimity – difficult enough with 15 Member States, let alone 25 or 27 – while Parliament still remained excluded from certain key policy areas, including agriculture, the EU's biggest in terms of budget. With the imminent arrival of euro notes and coins, the governance of the all-important stability and growth pact was weak, with many Member States seemingly content to bend the rules for the sake of short-term economic and political gain.

National parliaments, meanwhile, were reduced to rubber-stamping the inter-governmental agreements made by their national leaders, while the European institutions, it seemed, had a difficult time to work together towards the shared goal of economic and social prosperity for all.

Of course, the ultimate rejection of the European Constitution and renegotiation of what eventually became the Lisbon Treaty meant that this remained the situation for far longer than expected – a full five years after enlargement.

But with the crisis already looming, the entry into force of the Lisbon Treaty in December 2009 came not a moment too soon, bringing with it the necessary changes to allow the EU to respond more effectively to the challenge.

First, it increased democratic legitimacy and transparency by boosting the budgetary and legislative power of the directly-elected European Parliament, and by giving a specific role to national parliaments in terms of monitoring subsidiarity – assessing whether legislation is better left to the European, national or, in some cases, local level.

Both European and national parliaments have been quick to use their new authority: the European Parliament, for example, demanded and won much greater data protection for Europeans before approving the SWIFT agreement with the United States, while national parliaments have taken their post-Lisbon subsidiarity watchdog role extremely seriously, stepping up the level and frequency of their dialogue with the Commission– as I know only too well as the Commissioner in charge of that particular portfolio.

Citizens also have, for the first time, a direct role in the policy-making process through the European Citizens’ Initiative that will come into force from 1 April this year. Initiatives supported by at least one million Europeans will get a hearing at the European Parliament and the Commission will decide within three months if and how it will feed the initiative into the EU decision making process.

Lisbon also brought major political changes, with the inclusion of freedom, security and justice within the EU framework and the establishment of the European External Action Service, Europe's first centralised diplomatic core, giving the EU a much louder voice on the international stage.

The objective of a clearer and more united international voice was always part of the rationale of the Lisbon Treaty. Throughout its genesis, the common wisdom was that EU Member States could only really count in the world if they were united around the active promotion of Europe's values and interests. The Lisbon Treaty was drafted to give us the tools and structures to do more together, not less.

Nonetheless, some critics believe that this new unity has come at a price, with Lisbon giving to the Council and Parliament and taking away from the Commission.

I do not agree with this assessment. EU decision making is not a zero-sum game. The rationale of the Lisbon Treaty was to strengthen all EU institutions, because they are all part of the same chain – and as we all know, just one weak link is enough to compromise the strength of any chain.

The Lisbon Treaty acknowledges and reinforces the competences of the Commission, including its near monopoly on legislative initiatives, its executive functions and the power to adapt non-essential parts of legislation to changing circumstances under the control of Parliament and Council.

The abolition of the pillar structure – with some policies covered by the EU framework and some remaining outside – and the extension of the ordinary legislative procedure and qualified majority voting in the Council have increased the Commission's responsibilities as facilitator and honest broker, made decision-making easier and more transparent and improved democratic legitimacy by boosting Parliament's role.

The Lisbon Treaty has without doubt re-enforced the community method, and within this system, the Commission has a vital role to play. It is uniquely placed to provide coherence and to ensure that the action taken is in the common interest. You would of course expect to hear this from me. But my personal experience from the General Affairs Council is that there is an increasing demand for a more active Commission, not only as an initiator of legislation but as a source of independent, objective and technically sound analyses and proposals of where Europe's priorities should lie.

Yet there is one area where this spirit appears, on the surface at least, to be somewhat lacking, and where the inter-governmental approach has taken the lead. I'm talking, of course, about the sovereign debt crisis.

If you believe what the newspapers say, it is Chancellor Merkel and President Sarkozy who have taken the lead on dealing with this crisis, relegating the Commission to the sidelines. Thankfully, this assessment could not be further from the truth. It is of course only natural that the political leaders of the eurozone's two biggest economies work towards solutions to the current crisis, but that is only part of the process.

In fact, the legislative package designed to tackle the causes and effects of the crisis was an excellent example of how all the institutions, working together, can act quickly and decisively. On the one hand, the European Council established a task force to propose measures for an improved crisis resolution framework and better budgetary discipline. On the other, the Commission worked on a package of legislative proposals for better economic coordination and an enhanced stability and growth pact – the so-called 'six pack'.

The interplay between the task force and the Commission certainly helped to build consensus. But even in what looked like a purely intergovernmental exercise to some observers, in practice the Commission soon played a central role, insisting in particular on equal treatment for all Member States and on the need for any legislation to be in the European interest. The final legislation was based entirely on the six-pack proposal, which had been strongly supported by the European Parliament, and which set the conclusions of the intergovernmental task force within the Union framework.

The need to continue to work together has not gone away, however. The next challenge – complementing the monetary union with an economic union based on stability and solidarity – will not be easy to meet. The fact that two Member States – the UK and the Czech Republic, as of course you know – have chosen not to endorse a community-wide approach to stability, convergence and governance in the euro area underlines that there are still widely diverging views on what needs to be done and indeed on how to do it.

The Commission did not ask for this treaty, which sits outside the EU treaty framework. It has always argued that if Treaty revision is necessary, then the Lisbon Treaty should be adapted accordingly. For the reasons you all know, this was not possible. The Heads of State and Government of the euro area therefore took the decision to proceed with an international agreement or, as it is now called, an international treaty.

The 25 Member States that signed to the new international treaty have agreed to implement a "debt brake" into their own legislation, preferably at constitutional level, as well as to new voting rules and an automatic correction mechanism that will enforce compliance with the Stability and Growth Pact more effectively.

Let's be clear, however - this is not the thin end of the wedge, leading to the inevitable undermining of the community method. The treaty itself may sit outside the EU framework, but its spirit is clearly in line with the goal of ever closer union. Let's not forget that the aim of the new treaty is to more closely integrate the economic and budget policies of the Member States that have signed it, which is what its aim would have been also had it taken the form of a revision of the Lisbon Treaty.

That is why the Commission, as guardian of the EU Treaties, was keen to participate in the negotiations in a constructive spirit, and to ensure that whatever was decided remained consistent with the body of EU legislation.

This was what we achieved: no new institutions have been created; the primacy of EU law is clearly acknowledged; the Commission has a central role in delivery of the Treaty objectives, always in conformity with the Lisbon Treaty and the Community method. In particular, the international Treaty will use the EU institutions to ensure compliance and enforcement of the agreed rules in the long-term interest of the sovereign states. This is something which pure intergovernmental cooperation can never deliver.

Most importantly of all, perhaps, the international treaty states that its provisions will become part of the legal framework of the EU within five years – placing the future of an agreement negotiated between governments directly in the community method.

Sadly, of course, the crisis is continuing, and it's important that the spirit of unity continues to permeate Europe's response to it. I'm glad to say that it was certainly very much in evidence at the informal European Council meeting at the end of last month, where President Barroso outlined a number of what he called 'quick-win' proposals from the Commission on the burning issue for EU citizens – how to boost growth and create jobs.

The overwhelming support from Council for the proposal to accelerate the fast tracking of the single market – as the 'crown jewel' of the European Union – was particularly welcome. I think it shows that there is an overwhelming demand for Europe to advance as one – not just the constituent countries of the EU, agreeing among themselves, but the EU as a 'project', with all its various institutions working together.

Not only is this by far the most effective way of getting the job done, quickly and efficiently, it is also by the best means of restoring public faith in the EU as an institution in its own right. All too often, 'Europe' is seen as the bad guy - imposing austerity on Greece, forcing Belgium to rethink its budget, for example – but of course, these countries are themselves part of that very same 'Europe'.

'We are all in this together' is a difficult doctrine to sell to people whose pensions, salaries, purchasing power have all been slashed in the name of austerity. This is why we need to recall a fundamental principle: solidarity between Member States and institutions.

It's fitting, perhaps, that I am talking here in the College of Europe on the subject of the future of the EU, in the same place and on the same subject as the now famous speech by British Prime Minister Margaret Thatcher in 1988. Europe was a very different place then, of course – smaller, leaner, less integrated, with Maastricht, Nice, the euro, enlargement all many years in the future.

I'm sure Meryl Streep can do a much better job than me, but if you'll allow me to quote briefly from Mrs Thatcher:

"Willing and active cooperation between independent sovereign states is the best way to build a successful European Community. To try to suppress nationhood and concentrate power at the centre of a European conglomerate would be highly damaging and would jeopardise the objectives we seek to achieve. Europe will be stronger precisely because it has France as France, Spain as Spain, Britain as Britain, each with its own customs, traditions and identity."

It is nearly a quarter of a century since that speech, and as I said, much has changed. Yet there are still plenty of people who share that view – that Europe is simply the sum of its parts, if I may summarise crudely. Personally, I think that Europe is much more than that that each nation that makes up the EU brings much more to the entity as a whole than simply their own national identity and interest.

Nor, of course, am I alone in believing this. Take, for example, the recent speech by Herman Van Rompuy at Humboldt University in Berlin, where the President of the European Council underlined that, in fact, the crisis (and the fundamental changes brought about by Lisbon) have turned Mrs Thatcher's Europe on its head.

"What we are currently going through, "President Van Rompuy said, "is not a renationalisation of European politics; no, it is the Europeanisation of national political life. And ultimately, with all its limits and its risks, this change will make the European project stronger." A sentiment with which I can heartily agree. One of the other key elements of Mrs Thatcher's 1988 speech was the need for a 'Europe open to enterprise'. She talked of the need for open markets, free movement of goods and services, greater use of the European currency (the ecu, as it was then!). Nearly 25 years later, the need for all these is still as pressing, and yet we have still to achieve many of them. Why? I would argue precisely because national self interest has ruled over that of the community as a whole. The services directive is still not transposed in some Member States, barriers still exist to the free movement of goods and workers.

The single market has, I believe, the power to reinvigorate Europe as never before. We have 500 million people and 23 million small businesses just waiting to take advantage of what it can truly offer. That we have had to take Europe to the very brink of disaster – with the prospect of the collapse of the Union's flagship initiative, economic and monetary union – to finally focus everyone's attention on the benefits it can bring, is truly indicative of just how important the community method is.

Finally, I wanted to say a few words about Marie Curie, who I know is your patron this year. If the work of Marie and her husband Pierre can rightly be called epoch-making, her legacy stretches far beyond the realm of scientific research. Marie Curie was the first person to win two Nobel Prizes, the first female professor at the University of Paris, the first woman to be entombed on her own merits in the Panthéon in Paris.

She is in many ways a model European, citizen of two countries, one in the east, one in the west, but more than that, she personifies what can be achieved if the artificial barriers that society places in our path are broken down. We still face many barriers in Europe today. I hope that Marie Curie can be an inspiration to us all, not just to you here in the College of Europe, but to all Europeans, proving that dedication and commitment can overcome any obstacle that we face.

But Marie Curie was also part of a team, with her husband Pierre. Together, they arguably achieved more than they would have on their own. This, I believe, is the lesson of the Lisbon Treaty as well. If we manage to overcome the current crisis – and I am more confident now than I was a few weeks ago – I am convinced that the community method, as embodied in the Lisbon Treaty will have played a major part. It has helped us take that vital step on the road to true economic union, which I firmly believe will help restore prosperity to Europe.

Thank you for your attention

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