Europe's key institutions should have emergency powers to override economic and financial policies at a national level in times of crisis, Jean-Claude Trichet, former head of the European Central Bank, said on Wednesday.
The former central banker said Europe needed a new decision-making process given the extent of the crisis, because the current practice of imposing fines on those countries which break the rules and fail to meet EU targets has proved ineffective.
In these exceptional circumstances, the European authorities, Commission, Council and - this is essential - Parliament could decide directly on measures immediately executed in the country concerned, Trichet said, according to the text of a speech given at Rotterdam's Erasmus University.
In his speech, Trichet stressed the need for his proposed supra-national decision-making to have a strong democratic anchoring, with the European Parliament playing a crucial role - and having the final say on matters.
One has to be sure that the activation of the federation by exception is subject to a fully democratic decision-making process, and that democratic accountability is undisputable, Trichet said.
For such decisions to be effective, the European Parliament would have to approve by a majority vote the measures proposed by the Commission and already approved by the Council, he added: and only those members of parliament from the euro zone would be eligible to vote.
In these exceptional circumstances, where the stability and the prosperity of the euro area as a whole would be at stake, the national parliament should have the possibility of explaining why it could not implement the recommendations proposed, Trichet said.
But even after discussions between the national and European parliaments, the final decision should rest with the latter, Trichet said.