Juncker responds to Luxleaks tax scandal

So Margrethe, about these Luxembourgian tax schemes...

European Commission President Jean-Claude Juncker has just made an impromptu appearance at the midday press briefing to make a statement and answer a few questions on the furore surrounding the leaked documents showing the significant number of favourable tax deals given to corporations by the Luxembourg government during his tenure as Prime Minister and/or Finance Minister (1989 - 2013).

Here are the key points from his response:

• The Commission has previously reviewed the tax arrangements and stated that they are in line with national and international (EU) law.
• However, due to different national rules, the interaction between EU member states can lead to non-taxation and results which are not in line with moral/ethical standards. Therefore, there is a need for greater tax harmonisation in the EU.
• The Commission is committed to fighting tax avoidance and will do so under his tenure. There is no conflict of interest since Competition Commissioner Margrethe Vestager has a significant amount of autonomy and Juncker will not discuss the Luxembourg cases with her.
• Luxembourg has always supported EU tax harmonisation. As Commission President, he will push this idea again. He will also introduce a new mechanism for automatic transparency of tax deals so each member state knows what others are doing.

Quite a staunch defence by Juncker then but needless to say many of the journalists at the briefing (not to mention his critics in the European Parliament) seemed unsatisfied. A few key issues which continue to concern us are listed below.

• This should not be an excuse to push tax harmonisation at the EU level: Tax is a national issue and should remain so. Juncker’s use of this as an excuse seems to be mostly an attempt at deflection. There are key reasons why proposals on this have never gained traction. Juncker’s insistence that Luxembourg always supported such harmonisation is also an easy defence to make to an extent, since it is clear many other members do not – as such under unanimity there was little hope of it passing. Furthermore, Luxembourg (along with Austria) was the key holdout in delaying the recent deal on tax secrecy.
• Serious questions need to be asked about the level of scrutiny applied in Juncker’s nomination process: As we have long pointed out, the Spitzenkandidaten process which lead to Juncker’s appointment is a bad idea for a number of reasons (lack of scrutiny being just one of them). Juncker gained the nomination of the European Peoples Party through the support of 382 delegates (less than half the total). In the elections only 10.2% of the potential electorate supported this party (and they only voted for national parties which are part of the EPP), while polls showed that only 8.2% were able to name Juncker as a lead candidate. Furthermore, only a third of people knew the candidate of the lead party would likely become head of the Commission. Overall, there was little scrutiny of Juncker and little discussion of his policy proposals or his past.
• In general, tax competition is a good thing and should be maintained in the EU: That said, greater transparency is also good for having good functioning markets, promoting competition and helping spread best practice. Proposals for transparency therefore can be welcomed but should also include making information public, of course taking account of companies privacy and sensitive information concerns.
• All this though should not deflect from valid questions about Juncker’s role in the numerous tax deals struck under his watch: The key questions remains to what extent he was aware that such deals were undermining the tax collection of other member states. The basic premise of Juncker’s defence, to look forward at remedies, should also not detract from necessary scrutiny of these deals and what has happened previously. 

This story has plenty of way to run yet.

Seven reasons we love Slovenia's new Commissioner nominee Violeta Bulc

The first (and only) causality of the European Parliament hearings for Jean-Claude Juncker's new Commission so far, is Slovenia's Alenka Bratusek, who withdrew her candidacy for the post of Vice-President for Energy Union after a being effectively vetoed by MEPs.

She's been replaced by Violeta Bulc, Slovenia's Development Minister, who will face the music next Monday, when MEPs grill her on her suitability for the Transport portfolio (the Energy Union job will go to Slovakia's Maros Sefcovic).

But who is Violeta Bulc? Quite a colourful personality, if the internet is anything to go by. Europe is so often accused of being run by boring bureaucrats, even being accused of being as charismatic as "damp rags." Bulc is anything but. So we've picked out Bulc's best bits, mostly from her CV online for you to savour below.

1. Interesting ideas about energy generation:  "Natural environmental heat can transformed directly into electrical energy," says Bulc. A shame that she most likely won't have the Energy Union brief really as it could have made for an interesting discussion during her EP hearing.

2. She believes in 'Syntrophy' - which is apparently something to do with 'the creative power of nature.' And here's what she had to say about discovering it. (Note the CAPS.)

At various levels and in various dimensions, and every once in a while, something triggers excitement in each and every one of our cells. Love. Surprise. Achievement of a goal. A realisation along the way. A thought. Hope. Birth.

I felt this type of excitement when I was introduced to SYNTROPY. I can hardly express emotions that were flooding me while I was traveling through complex formulas that were mostly incomprehensible to me, yet so familiar that I felt as if they were a part of my life all along.

3.  Positive values: Her business, Vibacom, is run on the values of "the power of positive energy and pure thoughts." This "creates the conditions for prosperity and thrivability." Well, the EU could definitely do with an injection of positive energy...

4. Serious sporting prowess: Not only does she have a black belt in Tae Kwan Do, but she was also a professional basketball player in Yugoslavia, and won athletic championships in javelin. Eat your heart out Vladimir Putin.

5. She blogs: Violeta's blog is well worth a peruse. Here's a post from last month called, "The vibrations of the White Lions in the new Era."

6. She is a qualified Shaman and firewalker: She has a certificate from the Shamanic Academy in Scotland. No explanation offered - and is one needed? She has also received a certificate for "firewalk" and "breathwork" instructor at the recognised school of transpersonal education, Sundoor. Should come in handy during her grilling by MEPs...

7. She's got charisma: In 2010, she won the "Sunny Personality of the Year" prize. We're sure that a sunny disposition will help Bulc in Brussels which is hardly regarded as being among the most uplifting cities in Europe.

While we concede she may be a little out there, she certainly has the potential to shake up the dreary and self-regarding Brussels bubble.

Hill likely to be approved but Bratusek down as Juncker Commission edges closer

Hill's hearing was less of a duel than expected

Following another long day of hearings the make-up of the Juncker Commission is becoming clearer.

The UK’s Commissioner-designate Lord Hill had his second hearing in front of the Economic and Monetary Affairs Committee today and by almost all accounts performed well. While he was at ease and fluid as in his first appearance, he was importantly much clearer and more specific on the details of what he would like to achieve (for example on capital markets and banking union). This, combined with his extensive written answers, means that there is no grounding for rejecting Hill on content.

There were, of course, those who questioned his impartiality and independence but as we pointed out here, these complaints seemed to have little to do with Hill himself (who has few direct connections to the City left) and more with the fact he was from the UK. As liberal MEP Sylvie Goulard said:

“He took the exercise very seriously…We think it is unfair just to reject him because of his passport.”

Furthermore, compared to other Commissioners (Spain’s Miguel Arias Cañete springs to mind) Hill has far less recent and direct contact with his industry in question. His approval is now widely expected tomorrow.

Equally Cañete looks set to survive following a significant amount of political wrangling with the centre-right EPP sticking to its guns to ensure that the centre-left S&D does not try to block him – mostly by threatening to hold up the approval of France’s Pierre Moscovici, who incidentally also looks set to be confirmed.

As we always said though, things are looking less rosy for Slovenia’s Alenka Bratusek, who struggled on content during her appearance and also faces accusations of corruption over her nomination process. In fact it seems as part of the cross-party deal, she is likely to be rejected, meaning a new representative will need to be found for the post of Vice President for Energy Union.

Finding a new nominee for this position will be tricky not least because Bratusek is an experienced politician from a newer member state and contributed to the much debated gender balance of the new Commission. One option would be for Slovenian to put forward another one of its four nominees such as Tanja Fajon MEP, although she is unlikely to be considered high profile enough for the VP slot, meaning some reshuffling will still be needed (the FT has a plausible option here).

The other hearings from today went more or less as expected with the Netherlands Frans Timmermans particularly impressing, while Finland’s Jyrki Katainen produced a solid display in an area he has extensive experience in.

With Czech Vera Jourova now confirmed after being held up, the main wrangling will be over where to put Hungary’s Tibor Navracsics and who will fill Bratusek’s role. Much of this is expected to be decided tomorrow although with no firm timeline. One final issue which remains to be resolved is the exact split of powers between Commissioners and how the VPs will work with the standard Commissioners. Jean-Claude Juncker may have to provide further detail to the EP on this before he gets the final OK.

However, in the end, after pushing its luck earlier on the European Parliament now seems to have regained its control and sense of perspective.

Timmermans comes out fighting for EU Reform

Vice-President Commissioner Designate for Better Regulation Frans Timmerman's hearing at the European Parliament Conference of Presidents has just wrapped up, and the man who we've hailed as a  thought leader for EU Reform came out pushing many of the reforms we have long been arguing for

Seamlessly switching between five languages, he had some rather important things to say.

On regulation, he said that the EU needs a fundamental 'culture change' in the way in which it regulates to adopt a more "common sense" approach. Impact Assessments will have to be overhauled, and existing legislation needs to be assessed for its effectiveness. Regulations that doesn't make sense should be scrapped, so that business can feel an "immediate relief".

#Timmermans: Commission's impact assessment board has to be composed of ppl who can act w/out vested interests #EPhearings2014
— Open Europe (@OpenEurope) October 7, 2014

#Timmermans: What I am proposing is to change culture of the way in which we regulate in a more common sense manner (cites oil-jug gate)
— Open Europe (@OpenEurope) October 7, 2014

#Timmermans: I will present a better regulation review proposing regulations that shld be withdrawn within a year #EPhearings2014
— Open Europe (@OpenEurope) October 7, 2014

Consistent with his - and the Dutch government's - motto "National where possible, European where necessary," Timmermans had some strong things to say on respecting national parliaments:

#Timmermans: "This European Union will not be built against the will of the national parliaments nor the member states." MEPs need to engage
— Open Europe (@OpenEurope) October 7, 2014

#Timmermans: My principle of subsidiarity is you'll only take action on higher level if that's only way to achieve goals you want to attain.
— Open Europe (@OpenEurope) October 7, 2014

#Timmermans: If confirmed I will take debates directly to national parliaments #EPhearings2014
— Open Europe (@OpenEurope) October 7, 2014

On the need for more transparency and scrutiny, Timmermans said there will be increased scrutiny on behind the scenes deal-making and lobbying.

#Timmermans, we will make sure that there is a Mandatory transparency lobby list - currently only voluntary. #EPhearings2014
— Open Europe (@OpenEurope) October 7, 2014

On the institutional divide between euro-ins and euro outs:

#Timmermans reiterates that he does not support separate institutions for the #eurozone #EPhearings2014
— Open Europe (@OpenEurope) October 7, 2014

There was some stuff that may not go down as well in No 10, such as Timmerman's insistence on the importance of the European Convention of Human Rights (see here), and his description of the European Arrest Warrant as a "great success."

#Timmermans defends European Arrest Warrant, "a great success". We desperately need EAW. #EPhearings2014
— Open Europe (@OpenEurope) October 7, 2014

#Timmermans agrees that UK objections to application of #ECHR justified, but that opting out EU court rulings sets dangerous precedent.
— Open Europe (@OpenEurope) October 7, 2014

All in all, this was a strong performance that has already received good reviews on twitter and beyond. The response of the EP will be interesting to gauge and may give an indication as to how hard he will find it to push through some of these reform efforts in the coming years.

Juncker bitten by the hand that fed him as the European Parliament undermines his Commission

Juncker and Schulz in happier times...

The letter from European Parliament (EP) President Martin Schulz to European Commission President Jean-Claude Juncker has now been published in full and contains an extensive list of questions for the UK’s Lord Hill, the Czech Republic’s Vera Jourová and Hungary’s Tibor Navracsics who have all been invited back for some form of second hearing early next week (whether or not these will be ‘full public hearings’ again remains to be seen).

While the EP is certainly entitled to ask questions and has a role to play in the vetting process, we think the whole situation is getting a bit out of hand and that the Commissioner-designates are being set an almost impossible task. Let us outline a few reasons why.

1) Politicians expected to have the knowledge of technocrats. The EP was the driving force behind increasing the politicisation of the Commission, mostly through the Spitzenkandidaten process. With a more political Commission those inside will ultimately be more politicised, as will decision making. Nearly all the candidates are politicians with little technical experience. However, the EP is subjecting them to a level of scrutiny which no national incoming minister would be expected to pass on a brief they have in most cases never overseen. They seem more akin to the hearings a new central banker would face – the arch technocrats.

At the same however, MEPs are very intolerant of any Commissioners holding – as they see it – the ‘wrong’ political views meaning nominees have to tread a tightrope and try to appease a range of competing interests, e.g. promoting trade while protecting social standards, maintaining budgetary discipline while allowing for ‘flexibility’, or cutting energy costs while pursing green policies. This has led to accusations of a lack of coherence on the part of some Commissioners. This confusion over the Commission’s role is largely of the EP’s own making and sets an almost impossible task for the candidates.

2) Trying to force Commissioners to commit to policies ex-ante. This is simply a bad way to make policy. Sure, the candidates should outline key priorities and ideas, however, asking them whether they will or won’t pursue numerous policy proposals or will rule out certain actions over their entire five-year term seems to be overstepping the mark. Ultimately, the proposals the Commission will take forward are the result of a combined decision with the EP and member states and will be subject to economic and political circumstance.

3) The EP has a legislative role in trialogue negotiations, not in these hearings. Following on from the above point, the EP does not have a right to try to restrict the policy options of the Commission ex-ante. The EP has a role in the trialogue negotiations around legislation and can influence and change Commission proposals there. It should not double up this role by trying to tie the hands of new Commissioners by forcing them to take a policy stance before they have even had a chance to get an overview of their brief.

4) Hearings caught up in political games. There is no doubt that the hearings have become embroiled in political games, mostly between the centre right EPP and centre left S&D. While political trade-offs and negotiations are expected, these should not spill over into the public hearings and hamper the assessment of the competence of Commissioners.

5) Judging Commissioners on different and conflicting criteria. It is also obvious that there is no clear consensus on what basis to judge Commissioners. Some have been opposed on the basis of political allegiances, some on the basis of their nationality and some on their experience/knowledge (or a mix of the above). This picking and choosing of criteria once again undermines the process and makes it impossible for the Commissioners to know on what level they are being assessed. This has led to attempts to try to please everyone further worsening the scrutiny process.

The Commission has always been about a balance between political and technical expertise – it both proposes laws and is responsible for upholding them. There are legitimate questions that can be asked about potential conflicts of interest and a basic grasp of the policy issues at hand nut the EP has hugely overstepped the mark by seeking to pin down Commissioners to particular political agendas.

The Spitzenkandidaten process was all about establishing greater political control over the Commission’s agenda (as we warned). The great mistake that EU leaders made over the appointment of Juncker (we’re not talking about Juncker himself, but giving into the EP over the process) has clearly had the effect of emboldening MEPs further. The Commission – and now the nominees – are the piggy in the middle in the increasingly fraught power battle between national governments and the EP. Throw in a large dose of intra-EP politicking and individual egos, and it is a recipe for chaos and one that is likely to further distance the EU institutions from electorates across Europe, particularly if the EP makes the running despite itself hardly securing a vote of confidence in May’s elections.

European Parliament hearings of Commission nominees: Will MEPs claim any notable scalps?

Will Juncker's Commission survive unscathed?
(picture via @Gruene_Europa)

On Monday we will see the first hearings of European Commission nominees by the European Parliament committees responsible for their respective policy areas (full calendar here). The UK nominee, Lord Hill, will ironically be grilled by MEPs at the same time as David Cameron will be giving his closing speech to the Conservative party conference. 

MEPs are not able to strike down individual Commissioners but they do have a veto over the Commission as a whole and have in the past used this leverage to force member states to withdraw nominees that they did not like; Rocco Butiglione in 2004 and Rumiana Jeleva in 2009 (although Jeleva also faced considerable domestic opposition). There has also been a lot of speculation that one or more nominees to the Juncker Commission could also be 'taken out' by MEPs (Alex Barker of the FT has a good round-up here). There will certainly be a hell of a lot of posturing - but are any of the candidates at genuine risk? We asses the most 'problematic' candidates below:

Lord Hill - Financial Services (UK)

There has been a lot of speculation that MEPs will target Lord Hill (and some have already made it clear they will) but this is based less on reservations about his character or ability, and more to do with his record as a lobbyist, concerns about the UK being allocated the sensitive financial services portfolio, and hostility to the Conservatives' EU policies more specifically. While MEPs will not give Lord Hill an easy ride it is highly unlikely that he will face any major problems given that this would be seen as a huge and unnecessary provocation towards the UK (with no chance of Cameron backing down and putting forward somebody else). Juncker has further lessened the risk by transferring the contentious issue of bankers' bonuses from Lord Hill's remit into that of Vera Jourova, the nominee for the Justice brief. 

Prospects for survival = Strong

Pierre Moscovici - Economic and Monetary Affairs (France)

It is no secret that the appointment of former French Finance Minister Pierre Moscovici to this key portfolio is far from popular among conservatives in the European Parliament. Can Moscovici, whose country is consistently failing to meet the its EU deficit reduction targets, be credible enough to police eurozone countries’ budget policies? However, given that Moscovici will be effectively man-marked by two fiscally hawkish Vice-Presidents (Finland's Jyrki Katainen and Latvia's Valdis Dombrovskis), and also that it would be hugely unprecedented to reject such a high profile candidate from such a large member state (particularly given Francois Hollande's recent problems), he should be safe. The only serious threat to Moscovici would arise if the centre-left S&D group tried to veto one of the centre-right EPP candidates (see below) and the EPP decided to retaliate, and they've hinted that in that case they would target Moscovici. 

Prospects for survival = Strong

Karmenu Vella - Environment, Martime Affairs and Fisheries (Malta) 

European Voice suggests that Vella could also be in trouble as MEPs are unhappy at Juncker's decision to merge environment and fisheries and to give Vella a mandate for 'deregulation' in these areas, and also because Malta's track record in implementing EU environmental laws is poor. However, Vella himself is not responsible for the design of the Commission and it should suffice for him to assure MEPs he will give both parts of his role equal consideration. He may also face some awkward questions about long-standing allegations of "political thuggery, tax evasion and corruption" in his time in Maltese politics, but these have never been proved and so it is unlikely he will be placed under serious pressure.

Prospects for survival = Strong

Tibor Navracsics - Education, Culture, Youth and Citizenship (Hungary)

Hungary's nominee was always going to be controversial due to the strained relations between the EU and the Hungarian government headed by Viktor Orban who has been accused of anti-democratic practices such as undermining media plurality and the independence of the judiciary - particularly sensitive given the portfolio Navracsics has been given. Is is clear that Navracsics will face a hostile audience but with the backing of the EPP it remains to be seen whether enough other MEPs will actively try to see him axed from the Commission; in that case any Orban nominee would surely prove unacceptable, and this would trigger a wider political crisis. Moreover, as a former University lecturer Navracsics seems well qualified for this post and so we think that, ultimately, he will be safe.

Prospects for survival = At risk 

Miguel Arias Cañete - Climate Action and Energy (Spain)

Spain’s Cañete will come under fire for a number of reasons. In fact, it'll be open season. Firstly, there is his alleged bias towards fossil fuels compared with renewables. Secondly, there are concerns about alleged conflicts of interest; Cañete has sold his shares in two Spanish oil companies but Green MEPs have complained to Juncker that Cañete’s “wife, son and brother in law all remain as either shareholders or board members of these companies.” Furthermore, it has also been estimated that, during his time as Spanish Agriculture Minister, Cañete’s wife, Micaela Domecq-Solis and her siblings received around €1.8m in EU farm subsidies (though the same accusation could also embarrass some MEPs on the Agriculture Committee). 

Cañete will also very likely face questions about some remarks, widely interpreted as sexist, that he made after a TV debate ahead of the European Parliament elections in May. He said, “The debate between a man and a woman is very complicated. If you abuse [your] intellectual superiority, it looks as if you’re a machista and are cornering a defenceless woman.” There are enough ingredients for a lively hearing but as with Navracsics, the support of the EPP and the fact that he is a heavyweight figure within Partido Popular may be enough to see him through. However, he's definitely on the front line. 

Prospects for survival = At risk 

Alenka Bratušek - Vice President for Energy Union (Slovenia)

Where to begin? Former Slovenian PM Alenka Bratušek is seen by many as the weakest link in the new Commission and faces a raft of challenges. For a start, she nominated herself for the role as acting PM even though her party (appropriately named the Alliance of Alenka Bratušek) received a drubbing in the preceding parliamentary elections, picking up only 4.3% of the votes. The new centre-left coalition has launched in inquiry into her auto-nomination and would like to replace her with Tanja Fajon, one of their own MEPs (which would preserve the Commission's gender ratio).

Moreover, she has been allocated a hugely significant and sensitive role - Vice-President responsible for 'Energy Union' - despite having little experience in that area. As a member of the liberal ALDE group she lacks the protection of the two big centre-right and centre-left blocs (although ALDE's has joined the 'grand coalition' in the European Parliament). Her saving grace might be that not there will not be enough appetite in the European Parliament to reject the Commission outright, but if anyone will be substituted it is likely to be her.  

Prospects for survival = At risk

We will be covering the most significant hearings live so make sure to follow us on twitter @Open Europe.

German fingerprints on Juncker's Digital Agenda?

The 'digital agenda' was a key plank of Jean-Claude Juncker's 'campaign' to become European Commission President and will be one of the top priorities for the next five years. Indeed, his new look Commission has its own dedicated 'digital single market' cluster, which incorporates a large number of the Commission departments:

The Vice-President overseeing all this is Estonia's Andrus Ansip, a former Prime Minister of the country which styles itself as a 'digital society', with e-elections and online tax returns completed in five minutes. Former Energy Commissioner, Germany's Günther Oettinger, will take on a new role as Commissioner for Digital Economy and Society, which much of the German press saw as an embarrassment, particularly given the high-profile roles secured by France and the UK.

However, with online privacy and data protection such big issues in Germany, particularly following the NSA scandal, his appointment could be significant - not least because he is likely to have very different priorities to Ansip. Oettinger, along with the Czech Justice Commissioner Vĕra Jourová, will be responsible for ensuring passage of new data protection regulations and a revamp of the EU's e-Privacy Directive. He will also work on copyright. In turn, many of these issues will be integral to the US-EU free trade (TTIP) talks currently under way, another area of intense debate in Germany.

It has been noted by some that the CEO of Axel Springer, the owner of German tabloid Bild, publicly backed Juncker's candidacy (heaping pressure on Chancellor Merkel to do the same) and has a long-running beef with US internet giant Google. Whether this was a purely altruistic move we will leave up to you to decide...although we would note that one of Oettinger's first moves after the announcement of his appointment was to warn Google over its market power - a stark change in tone and approach from the previous administration, whatever the motivation.

In short, while Oettinger's appointment may not have been greeted by spontaneous cheers on the streets of Berlin, those in the corridors of power are likely to be quietly pleased. How 'German' the European Commission will be in this area will be interesting to watch.

Lord Hill is the EU's new financial services Commissioner - but what is his remit and who does he report to?

With the future of the UK seemingly hanging by a thread it is understandable that events north of the border are dominating attention, but today's announcement of the new European Commission also has far-reaching consequences for the future of the UK's EU membership and the EU itself.

As we set out in our flash analysis, the appointment of Lord Hill to the key financial services portfolio (pending approval by MEPs) is a win for the UK, and the general reformist outlook of the Commission, with other crucial posts (Internal Market and Competition) held by liberal, pro-free trade, non-eurozone countries, provides grounds for cautious optimism.

What will Lord Hill's portfolio include?

• Overseeing the creation of the banking union – a crucial policy for the eurozone but also one which threatens to split the EU into euro-ins and outs. In his new role, Lord Hill can ensure this does not happen. That being said, this is a very tricky role to manage (with numerous competing interests), especially for a non-eurozone country.
• Power to review the role of the European supervisory authorities, institutions which have been controversial in the UK since their creation.
• Responsibility for a 'Capital Markets Union'. While this remains vague it could be a good initiative for the UK since London is already the centre of European capital markets. Lord Hill can base the union around the single market rather than the eurozone.

As the charts below show, the Commission has also been re-organised with a series of policy clusters, with the UK being at the heart of all the major decisions relating to the single market, jobs and growth and the Eurozone. Each 'cluster' will be headed by a Vice-President, previously a largely meaningless role but now with additional agenda setting powers and the ability to stop legislative proposals from other Commissioners.

Lord Hill will 'report' to two Vice Presidents who will "steer and co-ordinate" depending on the issue at hand - the new "Jobs, Growth, Investment and Competitiveness" VP Jyrki Katainen and the "Euro and Social Dialogue" VP Valdis Dombrovskis (both of whom are former PMs). In terms of the two VPs, Dombrovskis is likely to supervise the banking union aspects of Lord Hill's post while Katainen will oversee the more single market aspects, although even here, there is plenty of scope for overlap.

Lord Hill's portfolio also has some overlap (and therefore potential conflict) with France's new Economic and Monetary Affairs Commissioner Pierre Moscovici .The potential for Anglo-French clashes within the Commission is relatively limited since Moscovici will be primarily tasked with macroeconomic eurozone policies rather than financial markets, but one potentially fraught area could the be Financial Transaction Tax or a Common Consolidated Corporate Tax Base. Juncker has asked Moscovici to finalise negotiations over both.

It remains to be seen how the relationship between VPs and different clusters will work in practice, especially as Juncker himself has insisted that "In the new Commission, there are no first or second-class Commissioners", and since decisions in the College of Commissioners have traditionally been taken by a majority of all Commissioners in a secret vote. However, Juncker also made clear that the Vice-Presidents “can stop any initiative, including legislative initiatives” of other commissioners – effectively acting as “a filter”.

Time will tell how potential disputes play out or are resolved and to what extent the VPs can truly veto proposals. What is clear is that the relationship between these four men could be crucially important.

Is Cameron the greatest pro-European of all EU heads of state and government?

As we've noted, the Juncker-hangover is already taking hold in parts of the German commentariat. In a hard-hitting piece, Lisa Nienhaus, the Economics Editor of Frankfurter Allgemeine Sonntagszeitung argues that the EU "needs more Cameron, not less".

"Hang on a minute, how exactly [was Cameron's opposition to Juncker] a mistake? He only said publicly what many think. Juncker may well be a jovial, cheerful bloke, but he is also an example of political mediocrity, who represents more of the same, a lack of ideas. Whoever wants to change Europe, and above all the opaque, hyper-bureaucratic European Commission, needs someone else in that post."

"Cameron did exactly the right thing. He did not only win the hearts of Brits but also of citizens in many other countries who worry about what will ultimately remain of the European Union, a bureaucratic entity that offers occupational therapy and valediction opportunities for veteran politicians. In this sense, Cameron is the greatest pro-European of all the heads of state and government."

She continues that Juncker did not enjoy a democratic mandate from the German people, and that Angela Merkel made a mistake by backing him:

"The Germans, for example, did not vote for the European People’s Party (of whom Juncker was the leading candidate) but the CDU. Juncker did not feature on the posters, it was Merkel. It is not the case that voters would have driven crazy if Merkel had ultimately arranged that someone else would have become the Commission President. In doing so, she would have shown that she takes this post seriously. Now she has only shown that she doesn't really care who takes this job."

As we have been arguing as well, Nienhaus adds that the European Parliament (EP) does not have more democratic legitimacy than the European Council, and the appointment of Juncker is effectively a power grab by the Parliament. She calls on Germans who share this view to support the UK:

"The heads of state and government are ultimately at least as democratically legitimised as the European Parliament. After all, they won national elections in their respective countries." 

"We can only hope that Angela Merkel does not take offence at [Cameron's] 'No’. We need the Brits in Europe, also for other reasons. The belief of the Brits that freedom is good for the economy, and that not everything has to be regulated by the state, is exactly that what the EU is currently missing."

Nienhaus concludes that the UK is vital for the future of the EU, and that the EU debate is missing some of the UK's beliefs:

"The suspicion among the Brits that the powers that have won want to initiate a redistribution of powers and favour a super-powerful state is widespread. That does not appeal to the liberal Brits. Those in Germany who share this view – and there are many – has to support the UK playing a greater role in the EU. We need more Cameron, not less."

Neinhaus's line is not universally accepted in Germany of course. Others have been sticking the boot into Cameron. Nonetheless, Berlin will be aware that last week’s EU summit is a foretaste of what life in the EU could be if the UK were to leave. Without Britain in the EU, Germany would face a bigger risk of being cornered by a block of Southern eurozone countries lead by Italy and France: something that is absolutely not in its long-term interests.

After the row: is Germany bringing the flowers and chocolate?

The dust from last Friday's extraordinary EU summit - the first at which an EU leader was actively outvoted over the appointment of the European Commission President - is starting to settle. As strong emotions recede, pragmatism is coming to the force both on the UK side - with David Cameron saying he is ready to put aside his differences with Juncker - and also on the continent and particularly in Germany.

Significantly, both German Finance Minister Wolfgang Schäuble (CDU) and German Vice-Chancellor Sigmar Gabriel (SPD) warn about the impact of a UK exit and stress the importance of the UK to the EU.

Here is Schäuble in today's FT:

“The EU without the UK is absolutely not acceptable, unimaginable. Therefore, we have to do everything, so that the interests and the positions of the UK find themselves sufficiently [represented].”

And, perhaps more surprisingly, here is Gabriel writing in today's La Repubblica:

"If we don’t manage together, over the coming years, to modernise Europe, make it less bureaucratic, respect national, regional and municipal responsibilities, then a large bourgeois majority of Britons – pushed by UKIP – will vote against Europe…The UK’s exit from the EU would signal the beginning of the end of the European project."

Interesting coming from Gabriel whose actions and rhetoric over Juncker could well have been designed to force the UK towards the exit door. Meanwhile, today's editorial in French daily Le Monde - not a natural supporter of Cameron - claims that:

“It is not an insult to [Juncker] to note that he doesn’t have the profile of a new man in Brussels…One of the priorities for Mr Juncker must be to repair the relationship with London. And to show, by innovating, that it’s no longer business as usual in Brussels.”

These comments show that - as we argued in our instant response to the Juncker appointment - it's all still to play for when it comes to EU reform.

Will there be a post-Juncker Brexit bounce?

The Mail on Sunday had the first poll (by Survation) following David Cameron’s summit defeat over Juncker’s appointment as European Commission President. The top line is that 47% of Britons want to leave the EU, with 39% in favour of staying in. Given the recent trend of polls finding majorities for 'In', this is quite a striking change.

However, a YouGov/Sunday Times poll (note that the fieldwork was conducted before the summit) showed attitudes to Brexit more or less unchanged, with 39% in favour of in, unchanged from a week ago, and only 37% in favour of out, actually down from 39% last week.

Other results form the Mail on Sunday poll would suggest that the Juncker episode has had a limited impact: 60% said Juncker's appointment would not change how they plan to vote in an In/Out referendum, while only 30% said it made it more likely they would vote to leave and 10% said they would be more likely to vote to remain.

Interestingly, the extent of German influence in the EU has not gone unnoticed. Asked who would have more influence over how the EU is run over the next few years, 50% said Angela Merkel, just 9% David Cameron, 11.5% Jean-Claude Juncker, and just 1.6% Francois Hollande.

It will be interesting to see further post-summit polls to see if the rise of the Brexit vote is an outlier or whether things have changed (even if only temporarily).

The Juncker row: Were there any concessions to the UK and what happens next?

The UK suffered a major defeat this afternoon when it was outvoted over Juncker becoming the next president of the European Commission. However, this isn't the end of the road for reform – not even close – but it certainly has strengthened the risk of Britain leaving the EU. See here for a our full analysis of this.

So did the UK get any early concessions? In his press conference, David Cameron took his defeat on the chin and said it would make his reform strategy harder:

“Today’s outcome is not the one I wanted. And it makes it harder, and the stakes higher…This is going to be a long, tough fight and sometimes you have to be ready to lose a battle to win a war. It has only stiffened my resolve to fight for reform in the EU, because it is crying out for it.”

Cameron was asked whether much more of this kind of thing would prompt him to recommend an ‘Out’ vote in a referendum. He declined the offer but did make the point that:

“And at the end of 2017, it will not be me, it will not be the House of Commons, it won’t be Brussels who decide about Britain’s future in the European Union. It will be the British people. It will be their choice, and their choice alone.”

 There were three nods to the UK in the Council conclusions:

• “The UK raised some concerns related to the future development of the EU. These concerns will need to be addressed.”

• “The European Council noted that the concept of ever closer union allows for different paths of integration for different countries, allowing those that want to deepen integration to move ahead, while respecting the wish of those who do not want to deepen any further.” 

• “Once the new European Commission is in place, the European Council will consider the process for the appointment of the President of the European Commission for the future, respecting the European Treaties.”  

Any of this significant? It’s the basis for a conversation but can mean anything and nothing at the moment. It falls way short of compensating for the defeat inflicted on Cameron. As we argue, it all depends on what happens next.

There were also this on the role of national parliaments:

"In line with the principles of subsidiarity and proportionality, the Union must concentrate its action on areas where it makes a real difference. It should refrain from taking action when member states can better achieve the same objectives. The credibility of the Union depends on its ability to ensure adequate follow-up on decisions and commitments. This requires strong and credible institutions, but will also benefit from closer involvement of national parliaments."

Again, hardly earth-shattering. So what happens next?

Well, in the short-term, there are three things to watch:

1. Will there but further nods to Cameron over the next few days and weeks? There’s already talk of Merkel, Hollande and Cameron doing something jointly. 
2. Who will become the European Council President? This is in many ways the person who will broker the agreement between EU leaders that will decide whether the UK will stay in the EU. This will be decided at an EU summit on 17th June. 
3. The other portfolios in the European Commission and who will become the UK’s candidate. Surely, Cameron must now respond by sending a big hitter to secure a top job?

What do Wayne Rooney, Rambo and Don Quixote have in common?

The script is written and the scene is set: Cameron will go down fighting in his bid to prevent Jean-Claude Juncker from becoming the Commission President with only Viktor Orban for company. While this has earned him some relatively positive headlines in the British press, the German press has not wasted an opportunity to stick the boot in.

According to Bild, “Cameron is becoming more and more the Wayne Rooney of EU politics: he lines up, he loses, he goes home.” The paper adds that:

"Great Britain and Hungary - this is not the strongest alliance in the EU. This could be a foretaste of what could happen if the Brits decide leave the EU in the 2017 referendum announced by Cameron. Instead of taking part in the largest and most economically significant association of states in the world, the Brits will be locked outside. The relevance and influence of Great Britain will fall dramatically."  

Die Welt describes Cameron as “the loneliest man in Europe”, and earlier this week likened him to "Rambo" - running in head first all guns blazing. FAZ’s London correspondent Jochen Buchsteiner describes the Cameron as the “Don Quixote” of EU politics, noting that “a majority of Brits see him as a hero – even when he comes back home beaten.”

Of those three, we suspect Rambo is the most favourable comparison, even if it was not meant as such. At least, Rambo is usually the only guy left standing once the credits start to roll. 

Lord Owen: Legislate to ensure Luxembourg Compromise is put into law

Following reports the the UK government has taken legal advice into the effectiveness of the Luxembourg Compromise - an agreement by which EU states can block EU decisions that threaten a vital national interest. Former Foreign Secretary Lord Owen has written to the Attorney General Dominic Grieve to request the legal advice and argue that as the appointment of Jean-Claude Juncker as Commission President would “increase the power of the European parliament without the prior agreement of the UK parliament” the UK should legislate to ensure that if the same process was used again the UK parliament would “have to agree the appointment.. and in the meantime the Luxembourg Compromise would be automatically invoked in the UK.”


The Following letter from Lord Owen and article explaining why he believes the UK should invoke the Luxembourg Compromise are published by Open Europe.

LORD OWEN BELIEVES THE PRIME MINISTER IN BRUSSELS SHOULD INVOKE THE LUXEMBOURG COMPROMISE.

David Cameron is reputed to be considering using the Luxembourg Compromise in the European Council meeting this week. He is not only fully entitled to do so, but the circumstances mirror the situation whereby an arrangement was reached by European Community Member States in January 1966 allowed for a decision requiring majority voting in the Council of Ministers to be postponed until unanimous agreement had been reached. That became known as the Luxembourg Compromise and despite many claims that the Compromise disappeared during the course of 1980s it was reaffirmed in the most explicit way by the then socialist Prime Minister of France, Pierre Béregovoy, to the French National Assembly in the context of a crucial debate on the Maastricht Treaty on 12 May 1992. An English translation of what he said was as follows: “France has never given up and will not give up the right in a serious crisis to protect its fundamental interests. When the application of the majority rule would challenge interests judged vital for one of the states, the mutual commitment remains to continue to seek agreement among themselves.”

The French record in the Assembly le Nationale reads as follows:

La France n’a jamais renoncé et ne renonccra pas au droit de protéger en case de crise grave ses interets fondamentaux. Demeure done l’engagement mutual des Etats de continuer a chercher un accord entre eux tous quand l’unanimite n’aura pas pu etre recueilie et que l’application de la regle majoritaire mettrait en cause les interets jugés vitaux par l’un d’entre eux.

Also in his speech he went on to say that any formalisation of the Compromise would “denature” the mutual commitment to seek agreement and render it less effective as a safeguard. Neither the European Commission nor the Court of Justice have ever accepted the Luxembourg Compromise but nor has the European Council ever renounced the existence of the Compromise and their potential use of it.

Neither of these positions are in any way surprising. There is and has been throughout the existence of the European Community, and now the European Union, a fundamental tension between supranational decisions and those taken by the nation states. The invocation of the Luxembourg Compromise saved the European Community in 1966. The Council conclusions stated that if one member state considered that “a very important national interest” was at stake then the Council would endeavour to reach within a reasonable period solutions that could be adopted unanimously. It is often referred to as a vital national interest. But that was not the wording that was used. The French view when very important issues were involved was that “discussions must be continued”, but this was not accepted by the other member states and that difference of opinion was noted and has remained ever since, perhaps because all such disputes have eventually been resolved.

President Hollande, in the light of what happened in France in the recent European Elections, would be playing with fire if he was not to support David Cameron’s right to invoke the Luxembourg Compromise. First and foremost, because it is by any standard “a very important national interest” for the UK. Firstly, because in Article 17 of the Treaty on European Union, it is very clear that members of the Commission “shall neither seek nor take instructions from any government or other institution”. That includes the European Parliament. It is essential that in both substance and in form the President of the Commission is seen to be able to serve the interests of the peoples of Europe, the European Commission and the Europe Council of Heads of Government.

The wording of the Treaty in relation to the choice of the President of the Commission it is claimed by some lacks clarity. The drafter of the words Lord Kerr, who was then Head of the Secretariat established by Giscard d’Estaing to draw up a new Constitution, has rebutted that argument. The procedure for choosing the President, in the words of Professor Alan Dashwood, a Europe-wide acknowledged authority on these matters, and some others, “separates the right of initiative from the right of final decision”, a separation of functions which they rightly claim is characteristic of the Treaty system. The European Council is, therefore, very clearly charged with identifying the individual they consider best suited to be President of the Commission and they are charged with taking “into account the elections to the European Parliament”. The individual heads of government are, therefore, left free to determine what taking into account exactly means. It is pretty clear that David Cameron believes that he should give the greatest weight not to the choice of the largest parliamentary grouping – in this case the one that is chosen as their candidate, Mr Juncker – but also the extraordinarily high vote in many member states for candidates who want substantial changes in or are even doubtful of continuing as members of the European Union. In that choice of priorities there is little doubt that he is supported by the British people and by the majority of Members of Parliament.

But there are other powerful constitutional arguments as well that should, and probably are, guiding the Prime Minister. No British Government is entitled to increase the powers of the European Parliament under Section 6 of the European Assembly Elections Act 1978 until there has been prior approval by an Act of Parliament. Agreeing in the European Council to endorse the choice of the European Parliament could certainly be subject to challenge in Parliament as going beyond the power of the Prime Minister in relation to the Act. He has already made a very substantial change in the British position over the future of the European Union. Ever since the collapse of the Eurozone the coalition government with the support of the official Labour opposition, have made it clear that the UK will not block such steps in the federalisation of the Eurozone that its members wish to take in order to preserve the Eurozone. In order to carry support for that position, which is a constructive one, which is also judged to be in the British national interest, it is imperative that there is no further move towards federalisation of the EU itself affecting non Eurozone members and in particular the UK.

There cannot be any doubt whatever that if Mr Juncker were chosen by majority vote in the present political climate it would be seen as a significant victory for those who believe that a federal union is the ultimate destination of the EU. That view is a legitimate one but is not one that I have ever shared while remaining a committed European. I believed in the validity of the federalist warning by the Labour Leader, Hugh Gaitskell, in a TV broadcast in 1962 and it has been amply justified by the trend of events over the last 52 years. There are today, we know, not just from opinion polls but from votes actually cast in the most recent European Parliamentary Elections, many people who are worried by the federalist direction in the European Union as a whole. If we ignore that sentiment then it will feed on itself. There have been many fine Europeans who have advocated federalism from day one, but the fact is there is nothing in the Treaties, and hopefully there will never be anything in the Treaties, that determines a federalist destiny. The EU is an evolving institution and there are many indications that its citizens want some of the decisions that have been taken in Brussels to be returned to the nation states. There is a widespread feeling that the European Commission has become too federalist and that the true democratic interpretation of the European Elections is that all the institutions, and I include the European Court of Justice, must pay greater regard to this reality in its interpretation of the Treaties. It is in this situation that the existence and invocation of the Luxembourg Compromise is fully justified and were it to be rejected then the British Prime Minister would be bound to take further actions following precedents first established by President de Gaulle, but which have also been followed through by other Presidents and Prime Ministers.

If you force 26 EU countries to choose between Berlin and London. 26 will choose Berlin.

The knife in the battle over the next Commission President has just been twisted a little deeper into David Cameron's side.

Both Swedish PM Fredrik Reinfeldt and Dutch PM Mark Rutte today announced that they will not seek to block Jean-Claude Juncker for the top post.

Both countries have huge reservations, (Sweden and Hungary were the only two countries to oppose the idea of Spitzenkandidaten from the get-go), but they apparently don't want to be standing on the wrong side of the fence from Germany.

Speaking in the Dutch Parliament today, Rutte said:

I’m set on [Juncker. He is] in a position to implement important Dutch wishes.

A slight departure, then, from remarks Rutte made previously, that the Spitzenkandidaten process is “not my preference,” and that he wants to initiate a fundamental debate on it “possibly during the Dutch presidency” over the European Council in 2016.

Importantly, Rutte also remarked:

Under no circumstances, will I make agreements over adapting the fiscal rules, or making them more flexible, in order to make the nomination of a candidate possible.

Meanwhile, Reinfeldt told the Swedish Parliament:

If Jean Claude Juncker musters a qualified majority amongst heads of state and governments, and also has the support of the European Parliament, well then, the rules set out in the Lisbon Treaty have been followed and Sweden will also join this majority. 

Though Reinfeldt doesn't actually state how he would act in an outright vote, it probably means he will not vote against Juncker. 

So that only leaves the Hungarian Prime Minister, Viktor Orban, on 'Team Cameron'. Orban said "there is no way" he would vote for Juncker, even before the European Parliamentary election.

Absent changes, Cameron is now a long way off a blocking minority to Juncker in the Council. With Italy trading support for Juncker in exchange for more "flexible" EU fiscal policy, and the Netherlands and Sweden dropping out too, Cameron will lose the vote on Friday. This is the grim reality, even though most EU heads of state are far from convinced about Juncker, and of the Spitzekandidaten process itself.

The top line is that if you pit London against Berlin, and ask other EU member states to choose between them, they won't choose London.

So the trick is to avoid that choice - which in this case was rather difficult. For reasons we've explained numerous times, the likely consequence of repeatedly forcing this choice is that the UK will leave the EU. That most certainly isn't in Berlin's interest either - or Stockholm's, or the Hague's, or Copenhagen's, or Warsaw's...

Is this really the best EU leaders can come up with?

The continuing furore over whether Jean-Claude Juncker will this week be crowned European Commission President has diverted attention away from the important issue of what he, or whoever else eventually gets the job, will be expected to do.

Like most others, we have seen a copy of a draft statement from EU leaders, expected to be announced at the conclusion of this week’s summit, setting out a “strategic agenda” for the EU for the next five years.

Safe to say, it is a very mixed bag. The preamble starts off with some reassuring words about subsidiarity:

“In line with the principles of subsidiarity and proportionality, the Union should only act when together we can achieve more than individual countries on their own. It should show self-restraint in exercising its competences when member states can better achieve the same objectives.”

There is another passage that – presumably as a consequence of the Euro elections results – warns against making promises the EU cannot keep:

“The credibility of the Union depends on its ability to ensure that its institutions follow up on decisions and live up to commitments.”

However, some of the subsequent action points seem to interpret both these points very liberally. For example, EU leaders look set to pledge to “further reduce early school drop outs” and “improve educational outcomes.”

Clearly, the futures of young people in Europe is of huge importance, but surely this is a matter for national governments - what will the 'EU', in the narrow sense, do in terms of policy to help school drop outs?

Similarly, the document talks of making “our social protection systems fit for the future”, an area of public policy explicitly reserved for national governments. What happened to the Dutch mantra “Europe where necessary, national where possible”? The next five years risk starting off with the same hollow commitments and lack of focus – responsibilities should be clearly divided and it should be clear where member states and/or the EU will take the lead.

Meanwhile, as Bruno Waterfield notes, there is limited reference to the reforms David Cameron has been arguing for. On national parliaments, the language is pretty vague:

“A greater place should be given to national parliaments, including by strengthening their means of participating in the debate and making their voice heard in the decision-making process.”

There are some more positive elements for Cameron, such as a commitment to “complete negotiations on international trade agreements, including TTIP, by 2015” and tackling “at all levels” the abuse of labour mobility.

One important inclusion is that the document follows the lead set out by UK Chancellor George Osborne and German Finance Minister Wolfgang Schaueble in the FT recently, by calling for:

"The integrity of the single market and openness towards non-euro EU countries should be preserved."

How exactly this will be done is unclear but the formal acceptance of the euro vs. non-euro split as an issue is at least a start.

That said, there is also an extended list of foreign policy commitments, such as "promoting stability", strengthening a common defence policy, etc, which could have been copied and pasted from any such document from the last 15 years.

All in all then, this is not an inspiring first draft. Much work needs to be done to improve it.

Is Bild having second thoughts about Juncker?

If Angela Merkel had privately hoped to quietly ditch Jean-Claude Juncker after the European election, it all started to go wrong when Axel Springer, the media group that owns Bild, Germany's and Europe's biggest selling paper, added its substantial weight to the pro-Juncker/pro-spitzenkandidaten campaign. This severely restricted Merkel's room for manoeuvre.

While Bild's editorial line has not changed explicitly, today's coverage of the issue is notably less enthusiastic. The paper's Brussels correspondent Dirk Hoeren asks "Will the Juncker deal be a dirty one?", with his piece claiming that France and Italy have made their support for Juncker conditional on a relaxation of EU budgetary rules (unlike Cameron who has taken a principled stance).

In a separate op-ed entitled “Merkel’s dilemma”, Bild’s deputy editor in chief Béla Anda argues:

“that the Southern Europeans will make their vote for Juncker dependent on an agreement on their debt policies shows the shabby extent the haggling over the EU’s chief post has reached.”

“If Merkel supports the election of a euro-softener to the post of Commission President, she will have backed the wrong horse.”

“Jean-Claude Juncker should be warned and be made aware that he must not be a chief at the mercy of Southern Europe.”

If you believe in tight observance of budget rules, as most Germans do, the last thing you want is to have a Commission President, appointed on a 'pan-European democratic mandate', who supports relaxing German-inspired rules on budgetary stability and the introduction of eurobonds.

While Juncker might need French and Italian support, ultimately he is the EPP candidate and Merkel is likely to bring her influence to bear. But imagine if 'centre-left' parties with a more avowedly Socialist spitzenkandidat were to win in future. How would Germany respond then, particularly the 'centre-right'? Would it be a case of yes to pan-European democracy, but only if the 'right' candidate wins? It seems like some people are starting to wake up to this prospect.

Is the UK gearing up for a defeat on Spitzenkandidaten?

Our views on the Spitzenkandidaten should, by now, be clear. And just for the record, this goes back to our opposition to the Lisbon Treaty, which was the wrong Treaty at the wrong time, answering the wrong questions. So, again, forget Cameron; it's about principle, precedent and best democratic practice.

However, several stories and reports – including one in Le Monde this morning and Bruno Waterfield's piece in the Telegraph – suggest that Angela Merkel has instructed Herman Van Rompuy to nominate Jean-Claude Juncker as the new European Commission President at the next summit of EU leaders. This means that the issue could be put to a vote as early as 26th June. Remember this is decided by Qualified Majority Voting (QMV) meaning the UK doesn’t have a veto. At the moment, it’s unclear whether there’s a blocking minority to stop Junker.

This means that there’s a real risk of David Cameron being outvoted on a matter he has absolutely gone to war over.

Whatever the rights and wrongs of Cameron’s tactics, such an outcome will go down like a lead balloon domestically. Many will say “You want to negotiate sweeping reform in Europe and yet you can’t even stop a super-federalist from becoming Commission President.” It’ll also fuel mistrust between London and Berlin. It would be a tragedy if the two capitals were to fall out over a former Luxembourgish PM and an ambiguity within in a misdirected Treaty before substantial EU reform even makes it onto the agenda. Who are the winners? Well, Juncker for a start. The German SPD who have used this to corner Merkel at home. The minority cult of transnational democracy within the EU - where the European Parliament is the ultimate source of democratic decision making (many clever and sincere people support this concept, but it is a minority cult nonetheless).

Is the UK quietly preparing for defeat? Well, this is still very much an open race. The UK will probably vote against Juncker no matter what. However, it could now also be looking for deals. As we noted several weeks ago, anything short of the internal market portfolio in the next European Commission, and possibly some wider commitment to European reform, will likely fall short of what many in the UK will demand.

There’s a second question. The UK is doing everything to stop the principle of ‘Spitzenkandidaten’. This could mean ending up with someone London wouldn't normally have accepted, like Michel Barnier or someone similar.

If the UK manages to block Juncker, for example by moving him to European Council President instead and then getting Barnier instead, it still won’t look good despite the huge expansion of political capital. For Cameron, the next European Council between 26-27 June is shaping up to be the most important such gathering since the 2011 Council when he vetoed the Fiscal Treaty – if not more significant.

We told you it would be messy…