Ms Catherine Day:

I thank members for some very interesting questions. First, on the discussion of the draft budget and the reason member states in the euro area have agreed that the Commission will look at their draft budgets, it is to make sure that at a stage when the member state in question can still change and the Commission still can have an influence, the budget is on track. This is because in all the different processes, there are pathways to arriving, hopefully, to the steady state. It is important that before budgets are decided, governments know whether, in the Commission's opinion, they are on-track or off-track, in order that it does not happen too late when all the negotiations are done and a decision must be taken. Consequently, we do not judge the quality of the policy at the stage when we consider the draft budget. We look more at whether it is well constructed or meets the essential criteria. We then look at the choices that are made in the May moment to which I refer. I honestly think it is for every member state to figure out what works best for it. I mentioned Ireland being obliged to move forward to October with the adoption of the draft budget. This was because Ireland and a few other countries had a different cycle from most of the other member states but that is a one-off change and now it will happen every October. Countries are so different and organise themselves so differently that the Commission has this single moment when we must look at all the budgets because we must also compare them. However, the question of how parliaments and governments organise themselves to get there is not really our business. That they be at the point of rendezvous with the right material is where we bow out.

The question about the big and small member states is really valid. I am absolutely categoric in stating that if the Commission does not apply the rules equally to all member states, we are not doing our job and there is no hope that any system like this will work. It is very important that the big member states submit themselves to the same discipline as everyone else and that they follow the approach. This has not always been the case, and if one goes back to 2003 or 2004 one will see that France and Germany basically agreed to ignore the Stability and Growth Pact and the seeds of some of the problems we have seen since were sown at that point. What is different now is that the enormity of the crisis has made member states realise that being in a common currency requires a different governance system and that all member states must be part of it. Consequently, I do not envisage any member states challenging the system or challenging the role it has asked the Commission to play. While challenging the interpretation of the facts, the recommendations, etc., is a different matter, no member state now is stating it does not wish to be part of this or will not implement it. Legally, the member states have committed themselves to consequences. We hope we do not get into this territory but if a member state was to ignore systematically both the recommendations of the Commission and the decisions of the Council, as I stated, there now are fines and sanctions as part of the system. We hope they are the kind of deterrent that must exist on paper in order that the system has teeth, but that in member states' own interests, they would realise the need to take action long before getting to that situation. The Commission is not only legally permitted to so do but sees this issue in exactly the same way as does the Deputy - that is, how can one have rules that only apply to some member states, as they must be applied to all. While I do not wish to draw a direct comparison now, my explanation a moment ago about Germany and the in-depth review is a clear illustration of the rules applying to everyone. Moreover, the trigger points in the system now are so transparent that everyone can hold the Commission to account as well. However, the political determination to be even-handed across the member states is very strong.

On the question of democratic legitimacy, there always is room for improvement. However, it is very important that through members of this committee, we make clear to people that the Commission does not decide anything. The Commission makes proposals and has a very strong power of persuasion. It has a very good analytical capacity but everything we recommend goes to Ministers to be decided. Consequently, it is democratically decided by Ministers who were elected by each member state. Sometimes it is convenient to give the impression that it is the nasty Commission that takes all the tough decisions, but really, as members are aware, the decisions are taken by Ministers and, in deciding the framework legislation, with the Parliament. It can always be improved, and that is the reason the Commission is making a big effort to staff up its representations to be good links between the different capitals and the decision-making machinery in Brussels. It also is the reason Commissioners are stepping up their visits to national parliaments. It also is the reason the Commission would like to have more input from national parliaments.

Perhaps I will jump to the question about what can be done on the scrutiny of European Union legislation. What we have seen, after an initial enthusiasm from national parliaments about getting all of the Commission proposals in draft, is that most national parliaments are swamped. My main piece of advice is that, somehow or other, each national parliament must find a way to choose the priorities on which it will concentrate. Members are aware that all European legislation starts with a Commission proposal. Moreover, a lot of European policy proposals also start in the Commission. We publish our work programme each year and publish what we call roadmaps, which are a first analysis of problems on which we are working, thereby giving an indication that there may be proposals coming down the track. It is a question of organising with the secretariats what are the next things on which members will focus that really matter in the national context and then developing on that, rather than trying to cover everything. The European Union is involved in so many things and there is so much going on at the same time that it is not possible. However, I think it is very important to be selective.