Juncker’s first move

When European Commission president-designate Jean-Claude Juncker takes over the office later this year, his task will be to prove that the European Union and its institutions are relevant for dealing with globalisation and global demographic, technological and environmental change. In our recent Bruegel policy brief, The great transformation: memo to the incoming EU Presidents, we discuss the central challenges that he as well as the Presidents of the European Council and the Parliament face. We argue that the three Presidents jointly have to work on developing a proper growth strategy and driving a reflection process on treaty change. The reform of the institutions is of central importance to deal with the challenges – and is a primary obligation of the new European Commission president and the topic of this blog post.   

One early move that Juncker should make is to do away with the current European Commission college structure of one portfolio for each of the 28 member states. This would demonstrate that he is prepared to make changes, and would be a signal to those that are disenchanted with the EU that he recognises their basic concerns, primarily the need for growth and jobs.

An effective Commission would have only a dozen policy areas in which it would take action. While the number of commissioners cannot easily be reduced, it should be acknowledged that not every commissioner can have a full portfolio without leading to inconsistency of policy and excessive activism. A solution would be for every commissioner to have the full rights of a commissioner with a full vote in the college. However, not every commissioner would be responsible for a distinct portfolio. An alternative constellation would consist of several clusters of competences for which several commissioners would be jointly responsible.

A first step should be the appointment of a senior vice president without portfolio responsible for the European growth strategy. The senior vice president would oversee all the relevant Commission activities to ensure that policies are implemented to their maximum effectiveness to promote growth. There would be a particular focus on single market and industry, the digital agenda, science and research, education and skills, and regional policy. The senior vice president would have a small staff, consisting essentially of the part of the General Secretariat currently in charge of the Europe2020 strategy.

Meanwhile, the enterprise and single market portfolios should be merged into a single market and industry portfolio to emphasise that European industrial policy should be about framework conditions and deepening the single market while reducing national regulatory fragmentation. Industrial policy based on subsidies and support for national champions is not the right approach for more growth and jobs in Europe.

The rigorous enforcement of competition rules is central for economic performance. Attempts to make competition policy subject to narrow industrial policy interests are unwarranted, as are claims that it prevents the emergence of European champions. Many sectors remain dominated by national operators in the different national markets, and substantial regulatory barriers still prevent companies, in particular in the services sector, offering their products in other EU countries. The single market agenda is therefore more relevant than ever. However, acknowledging the inherently complex nature of competition policy, a high-level committee of five independent experts should be appointed to review once a year the actions of the European Commission, and give independent advice on the direction of competition policy. Their reports should be public but should not be binding.

The economic and financial affairs commissioner must play a central role in the growth strategy, including by shaping the EU-wide fiscal stance, but she will have to operate independently of the many requests from within the Commission and focus on her mandate and the need to keep fiscal policy credible. In many countries, debt levels are already very high and fiscal consolidation is therefore important.

These moves will help to create a better foundation for a coherent strategy to address Europe’s big challenges. These are threefold: boosting feeble economic growth in the face of emerging-economy competition, streamlining the EU’s institutional set-up and proving that it is capable of dealing with pressing external matters, and, ultimately, facing up to the need for treaty change in order to clarify the relationship between the euro area and the EU, and move beyond the factional politics of ‘More Europe’ versus ‘Less Europe’ to ‘Better Europe,’ with the right competences allocated to European level while others remain at, or are even repatriated to, national level.

The appointment of Jean-Claude Juncker has been a difficult process, and the signals he sends early in his mandate will be important to heal rifts and set the tone. Changes to improve the functioning of the top-heavy Commission college, and to focus it on the right priorities, will be central.