By Quentin Peel
Angela Merkel wants to keep David Cameron on board in European Union negotiations, above all to ensure that he does not try to block efforts to find a lasting solution to the eurozone crisis. That is her absolute priority.
Although the two are miles apart in their vision of the EU’s future, the German chancellor rather likes the UK prime minister. She understands the threat he faces from eurosceptic Conservative backbenchers. But she is not impressed by his negotiating style, and not optimistic about reaching a compromise on Mr Cameron’s top priority: a freeze on EU spending for seven years.
“We are closer to his ideas than are many of the other European countries,” according to one German official after the two had dinner in Downing Street. “But he has manoeuvred himself into a corner. To put a figure on the freeze, and allow himself to be tied to that figure at such an early stage, is not usually regarded as the grand art of negotiating.“
The chancellor toyed with the idea of abandoning the budget-setting summit altogether if Cameron insisted he would veto anything other than an outright freeze. But that is not her style. It would not help matters to chuck any more vetos into the room, she said tartly before she travelled to London.
Germany’s compromise proposal would set a ceiling on the EU budget from 2014-20 at 1 per cent of gross domestic product, about €130bn below the European Commission proposal for a seven-year €1,033bn total. The UK proposal would slash the Commission figure by an estimated €200bn.
Merkel’s sympathy for Cameron’s domestic plight is not shared by many of her own parliamentarians, let alone her advisers.
Michael Stübgen, European affairs spokesman for the chancellor’s Christian Democratic Union in the Bundestag, says: “Whenever a question of European integration arises, the British say No. That is a real problem. We need to move ahead.
“I think it would be better if the UK remained in the EU. But in recent years, Cameron has developed a European style which cannot be sustained for long.”
“Most of us want a clear decision. The British must decide. About 80-90 per cent of British MPs want a referendum. I would really welcome a decision.”
He believes some sort of exit would be negotiable: “If they want the status of Norway-plus, or something like that, it is do-able.“
Ms Merkel has not reached such a dire conclusion. But patience is running out in the chancellery. Officials have been exploring the legality of reaching a political agreement at EU-26, ignoring the British, and then setting annual budgets by qualified majority voting. It might be a way round the UK veto, but it seems unlikely to get past the lawyers.
More likely is deadlock this time, with agreement postponed at least until the spring. That is what Downing Street expects, and Ms Merkel may be forced to agree.
“Britain can live without the November council coming to a conclusion,” one adviser says. “It is not vital to anyone. But we would like it to happen. It would be a very good signal (to the markets). And there is no reason to think things would be easier in six months’ time. It would be a missed opportunity.“