'No middle way' warns gloomy Delors

A GLOOMY Jacques Delors spoke yesterday of the dangers of a 'smouldering crisis' in European politics. Arguing that there was 'no middle way between survival and decline', he warned that if the 12 EC member states could not forge ahead together, some would then want to move ahead at their own pace.

The warning came as Britain produced new proposals to provide the basis for a fresh referendum in Denmark on the Maastricht treaty.

'As a militant European, I hope the construction of Europe will continue with those that are prepared to share ambitions and maintain a balance of rights and duties . . . enabling the EC to play its historic role,' said Mr Delors. 'I believe that if some don't want to do this, others will and then another solution will then have to be found to pursue this end.'

The EC, he said, had spent years emerging from 'Euro-sclerosis', and if it did not seize the moment it risked sinking back to that state or 'existing in a form that will ensure its marginalisation in the history of the next 10 to 20 years'.

He made much of the economic improvement that must take place if Europe is to advance materially and as a concept in the minds of its citizens. He argued strenuously for his controversial budget proposals: a one-third increase in spending spread over seven rather than five years, with substantially bigger funds for regional spending and the new cohesion fund for the EC's four poorest members.

The British presidency compromise would greatly weaken this package, but Mr Delors argued that it was regional and cohesion spending that made the benefits of EC membership a reality for 70 million people.

Whereas there was most support for a growth plan to finance capital spending and infrastructure projects, he said, the 12 were as far apart as ever on future financing arrangements.

Targeting Germany and Britain, the EC's main paymasters, who are reluctant to write bigger cheques, Mr Delors asked: 'How can one accept mediocre commitments from countries with short- term budget difficulties?' Then, narrowing the sights to Germany, he pointed out that high German interest rates had hit everyone, saying: 'German unification is paid for not just by Germany but by others as well.'

His mood mirrored the sense of inertia that all EC governments so fervently hope the Edinburgh summit will dispel. 'History over the last 35 years has shown that the worst crisis is a smouldering crisis that drags on and on,' Mr Delors warned.

Tonight, John Major will dine with Francois Mitterrand - the last of his bilateral contacts before he has to chair the most difficult international gathering of his career. The French President went on record this week as saying that if Britain and Denmark failed to ratify the Maastricht treaty, it would be possible to press ahead as 10. In an interview with AFP last night, however, Mr Major insisted that the treaty could not go ahead unless all 12 countries ratify it, because 'Europe advances as 12, or Europe cannot advance'.

No one is really trying any longer to put a brave face on events since the Danish referendum in June. Certain British officials this week even went so far as to say that 'the old idea of steadily increasing integration is bust'. It was unfair, they suggested, to blame it all on Denmark, noting a 'genuine reactionary distaste' for making concessions to the Danes.

New British proposals for the Danish problem would try to square the country's demands for legally binding opt-outs with the requirement that no new ratification procedure take place. The British idea of a 'decision' caused problems to some EC states, and may be renamed. But the wording of the 'decision' has also been changed, suggesting that it may have lost some of its legal force. Danish critics have already said that the British plan did not go far enough, and that their central objections were to the treaty itself.

Mr Delors admitted yesterday that the Maastricht treaty was ambitious, but not overly so. The problems stemmed from three things, he said: constructing Europe too far from the people, a declining economy, and the fact that the treaty was a compromise on different views of the aims, structure and administration of union.

Progress on subsidiarity - decision-making at the appropriate level - should remedy the first, he said. The Commission has fed its own ideas into a presidency text, which will probably be approved in some form in Edinburgh, for applying a 'subsidiarity test' to all Community legislation.