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EU supervisory agencies - 'no Plan B'

Wednesday 8 December 2010 - by Andrew Hickley

The former head of the Committee of European Securities Regulators has voiced concerns that there may be "no plan B" for the funding of the EU's new supervisory authorities should the deadlock over the Union's budget continue.

Speaking to GFS News, Eddy Wymeersch argued that while a compromise in the budget will eventually be arrived at, the agencies could effectively be "closed for months and months".

With the Parliament and Council still not agreeing financial terms for 2011, the European Commission has confirmed that new supervisory authorities covering securities, banking and insurance and pensions will be forced to operate on the budgets of the three committees they are replacing.

"It is a problem, that is evident," Wymeersch said.

"These committees are funded partly by the member states and partly by the European Union, so for a couple of months they can continue to draw on the national funding, but after that it's a real problem".


The new agencies due to begin operations on 1 January include the European Banking Authority, European Securities and Markets Authority and European Insurance and Occupational Pensions Authority.

Forty per cent of their planned €40m total financing is set to come from Union funds, with 60 per cent derived from member state contributions. But with no new budget, the EU will be forced to operate under the 2010 budget, which had committed no new funds to these authorities.

Outsourcing the functions of the new authorities to national agencies could be a short-term"bridge in financing," he claimed.

However Wymeersch added that, should the budget not be resolved, there is no fall back mechanism in place.

"You can sit it out for a couple of months, but you cannot do that indefinitely," he said. "And if that is the case I don't know if there is a Plan B."


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