Less could be more

German diplomats are not normally known for their cheerfulness. But their colleagues have commented on a profound sense of optimism since the first round of discussions on the declaration marking the 50th anniversary of the Treaty of Rome and the fate of the EU constitution.

The optimism is fuelled by widespread backing from EU leaders for the general thrust of the declaration and support for using the text as a stepping stone to re-launching negotiations on the constitution.

Diplomats say that although the discussions with Berlin have focused mainly on the 50th anniversary declaration they have also addressed the constitution to sound out governments’ views on the current text, which was rejected by French and Dutch citizens in 2005.

The meeting on 26 January of the 20-strong ‘Friends of the constitution’ group (the 18 member states that have ratified the constitution plus Ireland and Sweden) in Madrid showed that the majority of governments wanted to preserve the existing text intact or even go further by adding to it.

One possibility favoured by a large number of member states is to add a social protocol to whatever replaces the original text of the constitution to highlight the EU’s commitment to social values, workers’ rights and welfare protection.

Günter Gloser, Germany’s state secretary for EU affairs, said last week, referring to the drafting of the Berlin declaration: "We must give stronger expression to Europe’s social dimension." German Chancellor Angela Merkel mentioned the idea of a social protocol last year. Diplomats say that even the most economically liberal governments such as the UK realise that there has to be a signal that the concerns expressed by those who voted ‘No’ to the constitution in France and the Netherlands have been taken on board. But they say that the wording of such a protocol would be extremely difficult because the UK and east European member states will fight any move which might give the EU new competences over social policy. One option being proposed is making the protocol optional.

Diplomats are describing the majority position as the "constitution plus/minus" ie, keeping most of the institutional changes but downgrading some controversial aspects, especially Part III, which contains detailed provisions on policies and decision-making. This section was heavily criticised by the French left for anchoring a free market vision of the EU, although it mostly restates the existing articles from previous treaties. Part III could be recast to contain only the amendments introduced by the constitution while it would be politically easier to argue it would not be appropriate to put such a technical document to a referendum. This is the logic of the argument for a mini-treaty originally proposed by Nicolas Sarkozy, the French centre-right’s presidential candidate. But he now appears to accept a higher level of ambition for keeping parts of the constitution. His EU affairs adviser, centre-right MEP Alain Lamassoure, last week said that Sarkozy no longer talked about a mini-treaty, preferring the term "ordinary treaty", meaning one which could be ratified the traditional way by the French parliament.

Another cause for increased optimism is the growing conviction that any new text should avoid the need for a further round of referenda. There was a positive response to the new Dutch coalition’s decision last week to ask the Council of State to decide whether to hold a second vote on a new treaty. The new Czech coalition has also pledged not to hold a referendum, but Ségolène Royal, the French Socialist presidential candidate, has said that she would call one on a new text.

Despite the current Polish government’s reputation for Euroscepticism, there is also a degree of confidence that the coalition led by the Justice and Law Party would not fight to maintain Poland’s voting rights under the Nice treaty provided it got its way on a reference to Europe’s Christian heritage.

But it is the UK which is seen as the biggest possible obstacle to a deal on reviving the constitution. Senior UK diplomats say that Downing Street sees no urgent need for a new treaty, stressing that the EU can take action in important areas such as energy policy and climate change without any new transfer of powers or extending qualified majority voting. Even the unavoidable issue of the size of the Commission, British officials hint, could be dealt with through the accession treaty for Croatia - if, as many expect, it were to join the Union in 2009. London’s desire to avoid any treaty that would require a referendum, which would be difficult to win given the EU’s bad public image in the UK, is being interpreted as a rejection of practically all of the constitution’s changes. Some officials have even implied that the UK no longer supports an EU foreign minister or an EU diplomatic service because it would mean the Union taking on features of a national government.

The pessimism is made even worse by the fact that Prime Minister Tony Blair, who retains some credibility as a pro-European, will soon be replaced by Finance Minister Gordon Brown, who has a reputation for fundamental distrust of the EU, a penchant for playing the Eurosceptic card to the British media and a distaste for the navel-gazing of the debate about institutional reforms.

Amid German optimism about chances for a deal, there is an undertow that Berlin will not get a wide-ranging endorsement to retain nearly all of the constitution at the June summit with the prospect of a short, snappy intergovernmental conference (ICG) during the Portuguese presidency. Instead, some diplomats believe there could be a lengthy IGC lasting even until the French presidency in the second half of 2008. A drawn-out negotiation could help prospects of a deal as it would make it easier for Brown to link institutional negotiations to budget reform and cuts in farm spending. This would play to one of his foreign policy priorities - trade and aid for developing countries - as it would cut farm subsidies and facilitate a new world trade liberalisation deal. While it would not be possible to agree the post-2013 budget in detail already in 2008 or 2009, it would be conceivable to agree a few key principles, such as the introduction of national co-financing of farm payments, as Sarkozy’s aide Lamassoure has suggested, together with a pledge to phase out the UK’s rebate.

While some diplomats are arguing that linking institutional issues to the budget debate risks overburdening already difficult negotiations, others point out that the more bargaining chips you have on the table, the better the chances of getting a deal.

German diplomats are not normally known for their cheerfulness. But their colleagues have commented on a profound sense of optimism since the first round of discussions on the declaration marking the 50th anniversary of the Treaty of Rome and the fate of the EU constitution.