European Union finance ministers pressed for long-term financing of a proposed 315 billion-euro ($355 billion) investment plan, saying investors need to be convinced the bloc is serious about spurring growth.
Pushing back against demands from the European Parliament for more oversight of the program, ministers from Germany, Italy, the U.K. and Poland said it was important to create a stable outlook for funding.
The investment plan, EU Commission President Jean-Claude Juncker’s flagship economic proposal, aims to spur private-sector projects by offering loans, guarantees and other financing aid. The outline adds 5 billion euros from the European Investment Bank to 16 billion euros in European Union guarantees, and aims for a 15-to-one leverage.
“I think we do need to stick with the position the Council and Commission have come to, with an upfront contribution and all within the EU budget ceiling,” UK Chancellor George Osborne said. “The U.K. is always very keen on annual budget negotiations, but I think in this case as has been noted by a couple of the speakers before me, it would completely undermine the ability of the guarantee to attract investor confidence.”
EU parliamentarian Udo Bullman said on Monday that the fund can’t be set up as a blank check that allows unlimited leeway. European Commission Vice President Jyrki Katainen told nations on Tuesday that they need to reach agreement with the parliament this month for the plan to stay on schedule.
The parliament’s concerns should be heeded so the negotiations can conclude promptly, Dutch Finance Minister Jeroen Dijsselbloem said.
“We must accept that they have influence,” Dijsselbloem said. “We can’t say it is EIB business, stay out of it.”
EIB President Werner Hoyer said his bank, which will manage the investment fund and choose its projects, needs to move forward without political interference.
“It is not about using the EU budget for unnecessary risk, as I hear sometimes in parliament, it is about using public money more efficiently,” Hoyer said.
On the subject of state-aid rules, Katainen said the European Commission continues to look for a solution on how the fund’s EU guarantees will be affected by EU rules that aim to prevent unfair government assistance.
Italian Finance Minister Pier Carlo Padoan said solving this issue will be needed for the fund to avoid “blacklisting” certain types of projects and limiting its effectiveness.