In order to attain the objectives set out in the treaties, the EU institutions impose obligations on Member States on the basis of the competences that have been conferred on the EU. In areas where no such obligations are imposed, either because the EU does not have any power or because its institutions have decided not to use it, the Member States remain free to act and take decisions. In such a case, they might do this on their own or, if they so wish, in cooperation with other states that may also be EU members. Such a ‘closer’ cooperation is legally possible. It allows those Member States that want to cooperate together to progress on some issues or to develop some policies, whereas other EU Member States do not participate.

A number of Member States do practise closer cooperation in economic, industrial, military, cultural or other fields outside the EU institutional framework. The EU treaties do not forbid this so long as EU law is respected.

Under this option, a number of willing EU Member States, probably on the basis of the present composition of the euro area, would decide to go ahead and develop more intense cooperation in some areas, using all existing legal possibilities to do that. This would neither make it necessary to modify the current EU treaties nor to conclude a new international legal instrument. It could be publicly announced by a Political Declaration of the heads of state or government of the willing EU Member States.

It would depend on the political will of those states to decide to which matters their enhanced cooperation would apply. Decisions would have to be adopted in accordance with the rules of the treaties and within the EU institutional framework; on this basis, they could be adopted and implemented by the participating Member States only. Some cooperation could also possibly be developed outside the EU institutional framework, on the condition of fully respecting the EU treaties and EU law, as well as the rights of the non-participating Member States.

An assessment of the present situation shows that the European Union does not function well and that it is unable to solve its current fundamental problems.

Its political institutions suffer from weaknesses and deficiencies: this is the case for the Council, the Commission, the European Parliament (EP), as well as for the High Representative of the Union for Foreign Affairs and Security Policy (HR) and the European External Action Service (EEAS).

If the assessment of the present situation in Chapter 2 is correct, it means that while Member States will in the future still be in need of the EU, the EU will not be able to help sufficiently, given its present institutional procedures and rules. The logical answer to this dilemma in theory looks obvious: in order to respond to those needs, it would be necessary to modify the present institutions, their procedures and decision-making processes, as well as to try and conceive a more legitimate democratic control. In order to be adequate and to answer effectively the serious present problems and deficiencies, the amendments to the treaties need to be sufficiently bold. In other words, they should take the shape of a substantive revision of the institutional provisions of the current treaties.

Such a revision would be based on the recognition that with twenty-seven heterogeneous members, and the prospect of welcoming Croatia in 2013 (1 July 2013 was chosen during the European Council session of 23–24 June 2011) and possibly Iceland later, the EU has become an entirely new entity. One may add that some or all of the other western Balkan countries might also join the EU, poss-ibly in the 2020s (Albania, Bosnia-Herzegovina, the Former Yugoslav Republic of Macedonia (FYROM), Kosovo, Montenegro, Serbia). Some are also referring to Georgia, Moldova and even Ukraine, while Turkey is actually negotiating accession now. Such an entity of thirty to thirty-five members could not work properly on the basis of the present system, whose architecture and procedures remain those that were originally conceived for six Member States that had a comparable degree of economic development and the same political desire to integrate. In order to meet this challenge adequately, one should be much more innovative and creative than were the 2003/2004 European Convention and the 2007 IGC on the Lisbon Treaty.

The European Union (EU) is currently and simultaneously facing three huge challenges, which are making the present period the most serious crisis the EU has ever known.

First, there is an immediate and urgent problem, which already affects the stability of the EU and might even affect its survival if it is not solved rapidly: the acute crisis of the euro area. The imbalances in the EU's economic and monetary union (EMU), as it is conceived in the EU treaties, are serious. They will be difficult to correct as long as those Member States who have the euro as their currency remain the masters of their own budgetary and economic policies, as is allowed by the treaties. The process of giving huge loans to countries in need (Greece, Ireland and Portugal) might soon reach both its economic and political limits. Many economists think that no solution will be found without ‘significantly increasing the degree of political union’ according to Paul de Grauwe, or what a Nobel prize-winner for economics (2001), Paul Krugman, calls ‘a revised Europeanism’ and another Nobel prize-winner for economics (2008), Michael Spence, calls an inevitable ‘greater centralization and political unification’. Such a great leap forward would not only raise economic problems, but also political, institutional and legal ones.

(NB: responses were also received from all participating governments)

Social partner organisations:

1. European Centre for Enterprises with Public Participation and of Enterprises of General Economic Interest (CEEP)

2. European Trade Union Confederation (ETUC)

3. European Association of Craft, Small and Medium-Sized Enterprises (UEAPME)

4. Union des Industries de la Communauté Européenne (UNICE)

Non-governmental organisations:

1. The European Older People’s Platform (AGE)

2. ATD Fourth World

3. Combined European Bureau for Social Development (CEBSD)

4. European Anti-Poverty Network (EAPN)

5. European Disability Forum (EDF)

6. Eurochild

7. European Federation of National Organisations Working with the Homeless (FEANTSA)

8. Fédération Européenne des Restraités et Personnes Agées (FERPA)

9. The Platform of European Social NGOs (European Social Platform)

Organisations representing other policy actors:

1. Council of European Municipalities and Regions (CEMR)

2. European Association of Public Sector Pension Institutions (EAPSPI)

3. Network of Major European Cities (Eurocities)

4. European Network of Specialised Equality Bodies (EQUINET)