Monday, April 11, 2005

We have become more powerful XII

"And for all of those that say, if you look at the last thirty years, we have lost power to Brussels, actually it isn't true. In the last, certainly in the last eight years, as we, the Labour government, have been more involved in Europe, so we have become more powerful and more prosperous, better able, literally to implement a patriotic case for the European Union."

Jack Straw
Foreign Secretary

BBC Today Programme, 9 February 2005

According to reports from Reuters and Associated Press, the EU commission has told the British government formally to notify it within the next 24 hours of its plan to provide £6.5 million in emergency funding to help prevent the immediate lay-off of 6,000 workers at car maker MG Rover.

Reuters said commission spokesman Jonathan Todd told reporters today that it appeared the British government's support to MG Rover would be state aid and therefore had to be notified to the EU executive for approval before being paid out.

Speaking on behalf of the competition commissioner, Neelie "Board Lady" Kroes, Todd said that the commission expected to be notified about the plan "shortly", and "certainly within 24 hours."

"We only heard about this proposal on the radio at the weekend and this money must be vetted by the Commission under state aid rules," he told reporters, adding: "All state aids require clearance from the Commission, once they have been vetted to ensure they do not distort fair competition in a particular industrial sector."

Elaborating on this, he went on to say: "We do not allow operational aid, but the UK Government can issue a rescue aid package on condition that it last no longer than six months, by which time it must be repaid. Alternatively, if the company survives, it can be converted into restructuring aid, which is also acceptable to us."

"Finally, in the event that the company goes into liquidation within six months then of course the issue of competition in the market place no longer arises."

Todd said it was too soon to judge whether the aid from the British government was in line with EU rules on state aid but the commission would be able to give a signal soon after receiving the necessary information.

One shudders to think what Todd might have said if we had not become more powerful.

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