EU summit: UK and Czechs refuse to join fiscal compact

 

Twenty-five of the EU's 27 member states have agreed to join a fiscal treaty to enforce budget discipline.

The Czech Republic and the UK refused to sign up. The UK's position was already well known, while the Czechs cited "ratification reasons".

Czech President Vaclav Klaus, a Eurosceptic, may be reluctant to sign the treaty, called a "fiscal compact".

The goal is much closer co-ordination of budget policy across the EU to prevent excessive debts accumulating.

Germany - the eurozone's biggest lender and most powerful economy - was particularly keen to get a binding treaty adopted to enforce budget rules.

The treaty will empower the European Court of Justice to monitor compliance and impose fines on rule-breakers.

The Czech Republic is not yet in the euro, but like the other new EU member states it is committed to joining.

French President Nicolas Sarkozy told a news conference that the Czech prime minister had cited "constitutional reasons" for not acceding to the treaty.

"I'm not sufficiently familiar with the ins and outs of what's going on in Prague to understand why what was acceptable in December is no longer acceptable now, but it will be a treaty with 25 members because the Danish prime minister told us that his parliament has given him authority to ratify the treaty."

The EU summit also concentrated on reducing unemployment, which is averaging 10% across the eurozone, though youth unemployment is often much higher.

UK concerns

UK Prime Minister David Cameron said the fiscal treaty would impose "no obligations on the UK". But he added "we'll be watching like a hawk" to ensure that the treaty did not encroach on the EU single market.

Mr Cameron used his veto last month to opt out of the treaty, arguing that the UK needed to keep its authority over financial services in the City of London.

At a news conference after Monday's summit he said he still had "legal concerns over the use of EU institutions" to enforce the new treaty.

The eurozone crisis dominated the summit in Brussels, with debt-laden Greece still at risk of defaulting.

The EU has more than 23 million unemployed people and there are fears that wide-ranging budget cuts will harm enterprise and training.

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