Reality vs The Virtual World of Euro-Bureaucracy

It's hard to avoid the suspicion that the two events are linked. One day, Günter Verheugen, the Commission Vice-President, attacks the cost of Euro-bureaucracy. The next, photographs appear of the Commissioner strolling hand in hand with a female aide while on a visit to Lithuania. Mr Verheugen denies any impropriety and, in the absence of any evidence to the contrary, it would be churlish not to believe him. It just seems odd that photographs taken two months previously should suddenly appear in the press at the very moment that the Commissioner is making himself awkward.

A Commissioner can get away with many things. He can be idle, incompetent or drunk. He can be a former Stalinist, or have been convicted of political corruption. But he cannot give voice to the belief, held almost universally outside Brussels, that the EU is overly meddlesome. All manner of sin and blasphemy shall be forgiven unto men: but the blasphemy against the Holy Ghost shall not be forgiven unto men.

Nor was Mr Verheugen simply mouthing off. He offered figures to back his claim, and very scary figures they were. According to the Commissioner's findings, EU standardisation now costs businesses EUR600 billion a year. A billion here, a billion there - after a while it starts to add up to real money. EUR600 billion is a larger sum that the total spending of 20 out of the 25 member states. It dwarfs the EU's EUR110 billion budget. In fact, on the Commission's own statistics, it is nearly four times as much as the EUR180 billion savings supposedly generated by the single market.

Think about that for a moment. Here is the Commissioner for Enterprise and Industry - the man in charge of the whole thing, as it were - admitting that, from a business point of view, the EU has been a failure: that the benefits of cross-border trade are massively outweighed by the disbenefits of administrative and compliance costs.

Of course, Mr Verheugen's analysis will come as no surprise to those who work in commerce and industry. A handful of multinationals love Euro-regulation, seeing it as a way to squeeze their smaller competitors out of the market. But most firms find complying with Brussels rules an increasingly difficult struggle.

The Commission itself, however, inhabits a different world: a virtual world of deregulation and competitiveness and "slashing red tape". In any speech about business, a Eurocrat will kick off by telling his audience about something called "the Lisbon agenda", which will give the EU "the most dynamic enterprise economy in the world by the year 2020".

On one level, he genuinely believes it. Or, to be precise, he is so removed from the outside world that it does not occur to him to assess the real impact of his policies. I have lost count of how many times I have had variants of the following conversation:

HANNAN: "This latest proposal of yours [maximum working hours, or equal rights for temporary workers, or REACH] will destroy jobs in my constituency.

EUROCRAT: "Nonsense: we've just passed a resolution that says that the fight against unemployment is one of our top three priorities."

HANNAN: "Yes, but in the real world, your policy is making it harder for firms to take on staff."

EUROCRAT: "Didn't you hear what I just said? One of our top three priorities..."

Mr Verheugen's crime was to intrude a dose of reality into the virtual world, to crash through the careful suspension of disbelief that sustains so much European integration. What he said was true, and everyone knows it. That is why he won't be pardoned.