Jean-Claude Juncker, president of the European Commission, speaks during a news conference at the Group of 20 (G-20) summit in Brisbane on November 15. Juncker’s plan for more funding proposes to effectively deduct contributions when the Commission assesses national budgets, part of the EU’s new powers to oversee public spending by member states.

Juncker last month revealed a €315bn investment scheme to ‘kickstart’ stalling economy; EU’s 28 leaders are meeting next week to endorse the plan; Brussels hoping for more funding

AFP, Reuters

Brussels

 The EU urged doubtful national leaders yesterday to back Jean-Claude Juncker’s new investment plan at a summit next week after the scheme struggled to garner enthusiasm from governments.

New European Commission head Juncker last month revealed a €315bn ($370mn) investment scheme to “kickstart” the EU’s stalling economy, declaring it a major plank of his five-year agenda.

The EU’s 28 leaders are meeting next week to endorse the plan, but Brussels is hoping for not only a greenlight but more funding as well.

“The commission expects that head of state and governments next week offer a strong and unequivocal sign of political endorsement,” Juncker’s spokesman Margaritis Schinas said at a news briefing.

The €315bn figure “is only an indicative target that we can overshoot with member states’ contributions”, he said.

The current estimate is based on €21bn in seed money provided by the Commission and the European Investment Bank, money readily available to Juncker, which will act as leverage for further growth.

But with no control on how the money will be spent, and confusion on how the contributions will be counted, member states have so far held back from adding their pledges.

“We shouldn’t expect a donor’s conference,” one diplomat from a major member state said in advance of next week’s summit.

To drum up more funding, Juncker’s plan proposes to effectively deduct contributions when the Commission assesses national budgets, part of the EU’s new powers to oversee public spending by member states.

Schinas said it would be “budget neutral” — meaning that it would not appear as an increase in spending for member states.

But with cash strapped European governments under pressure from their voters about spending by Brussels, diplomats and officials said they were still unclear whether that was really the case.

“If that’s not clear, no one is going to be interested,” one senior government official told AFP.

Spanish Finance Minister Luis De Guindos said earlier this week that Madrid was “open” to participate but needed “more details”.

Details would likely include more specifics on how the plan will allocate funds —  and to what projects.

Despite their doubts, on Tuesday the member states unveiled a list of 2,000 projects worth €1.3tn.

The projects range from an airport expansion in Germany’s Frankfurt, to a underwater fibre-optic link between the Canary Islands and Brazil.

Meanwile, Juncker has given Greeks a stark and unusual warning of major problems if they vote the “wrong” way and radicals win an early parliamentary election.

Jean-Claude Juncker, the president of the European Commission, stressed in remarks carried late on Thursday by Austrian broadcaster ORF that he was not trying to insert himself into the Greek political process.

In general, EU officials take pains to avoid accusations of interference and Juncker’s remarks went beyond the normal reticence.

As the government in Athens faces a possible election and defeat by an untried left-wing party that opposes the terms the EU has set on Greece’s financial bailout, Juncker said he was not averse to seeing “familiar faces” remaining in charge.

Prime Minister Antonis Samaras said on Thursday that Greece risked a “catastrophic” return to financial crisis if his government fell as a result of a parliamentary vote he has called for this month to elect a head of state.

Juncker, who was closely involved in managing the eurozone debt crisis when he was prime minister of Luxembourg, said he was sure Greek voters understood the risks of an election that polls show could bring to power the left-wing Syriza party.

“I assume that the Greeks — who don’t have an easy life, above all the many poor people - know very well what a wrong election result would mean for Greece and the euro zone,” he said.

“I won’t express my own opinion. I just wouldn’t like extremist forces to take the wheel.

“I would like Greece to be governed by people with an eye on and a heart for the many little people in Greece — and there are many — and also understand the necessity of European processes.”

He said he did not view market ructions in Greece of late as a sign that a new Greek crisis was breaking out.