The Europa Midday Express, (Reference: MEX/11/0609 Date: 09/06/2011) the daily EU propaganda summary, has the following paragraph included today. Unusually, for items likely to be offensive to British sensibilities, it is not in French but in English, therefore I quote it here, word for word:
State aid: Commission approves further extension of Hungarian mortgage support scheme for households affected by financial downturn
The European Commission has authorised, under EU state aid rules, a six-month prolongation until 31.12.2011 of a Hungarian mortgage support scheme to help households affected by the financial and economic downturn. The Commission found that the extended measures, initially approved on 13.07.2009 (see IP/09/1123), and extended on 24.11.2009 (see MEX/09/1124) and 12.12.2010 (see MEX 10/1208), were aimed at well-defined objectives of common interest and well designed to deliver these objectives and to limit distortions of competition. The Commission has therefore concluded that they provide aid of a social character to individuals, affected by a temporary income shock and at risk of losing their home, on a non-discriminatory basis and as such are compatible with Article 107(2)(a) of the Treaty on the Functioning of the European Union.
I trust the above gives a nice warm and charitable feeling to all those struggling to make ends meet in the UK, especially those who have recently opted to convert to interest only mortgages. Given the credit warning to the UK , of yesterday, threatening the country’s triple A credit standing, can you imagine that the higher interest rates that would then surely follow will happily be met as a quid pro quo from Hungary or others in the EU as “aid of a social character to individuals, affected by a temporary income shock and at risk of losing their home, on a non-discriminatory basis and as such are compatible with Article 107(2)(a) of the Treaty on the Functioning of the European Union”.
Below I quote Article 107 (2)(a) which demands non-discrimination, so UK underwater mortgage holders seem to have just been handed a lifeline! I don’t think!
(ex Article 87 TEC)
1. Save as otherwise provided in the Treaties, any aid granted by a Member State or through State resources in any form whatsoever which distorts or threatens to distort competition by favouring certain undertakings or the production of certain goods shall, in so far as it affects trade between Member States, be incompatible with the internal market.
2. The following shall be compatible with the internal market:
(a) aid having a social character, granted to individual consumers, provided that such aid is granted without discrimination related to the origin of the products concerned;
(b) aid to make good the damage caused by natural disasters or exceptional occurrences;
(c) aid granted to the economy of certain areas of the Federal Republic of Germany affected by the division of Germany, in so far as such aid is required in order to compensate for the economic disadvantages caused by that division. Five years after the entry into force of the Treaty of Lisbon, the Council, acting on a proposal from the Commission, may adopt a decision repealing this point.