The European Union may amend plans to hand the European Central Bank oversight powers so that lawmakers have a stronger role in removing the vice chairman of its bank supervisor board.
Under proposals made by Ireland, which holds the rotating presidency of the EU, the ECB would have to respond to calls from governments or the European Parliament for the vice chairman to be removed, according to a document obtained by Bloomberg News. The ECB could answer questions from the Parliament verbally or in writing, under the proposals.
Ireland drafted the changes in response to German concerns that the ECB’s bank supervision arm would lack democratic scrutiny and wouldn’t be fully separate from the central bank’s setting of monetary policy.
Irish officials in Dublin told reporters they expect the single supervisor negotiations to conclude next week, after making technical changes. Germany believes that the current legal basis of the single supervisory mechanism is sound, said one official, representing the Irish EU presidency.
The supervision legislation may also include a “declaration” that they would “consider constructively” any proposals for treaty change related to the ECB’s new role, the document said. The Irish official said Germany would like to lay the groundwork for further efforts to reinforce separation between the ECB’s bank oversight and monetary policy roles.
Under a draft deal on the legislation brokered last month, the vice chairman of the ECB’s bank supervision committee would be drawn from the six members of its Executive Board. The amendments proposed by Ireland include that governments and the parliament could vote to remove the vice chairman of the oversight committee once he or she had already been fired from the Executive Board.
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