Mr Rajoy has become the latest European politician to calling for countries to, in effect, abandon their sovereignty in a last ditch attempt to save the beleaguered currency
Mr Rajoy said a new central authority was the answer to the European debt crisis and would go a long way in alleviating Spain’s woes as it would send a clear signal to investors that the single currency is an irreversible project.
Speaking at an event in Sitges, in the north-eastern province of Catalonia, he said: “The European Union needs to reinforce its architecture. This entails moving towards more integration, transferring more sovereignty, especially in the fiscal field.
“And this means a compromise to create a new European fiscal authority which would guide the fiscal policy in the euro zone, harmonise the fiscal policy of member states and enable a centralised control of (public) finances.”
He also said the authority would be in charge of managing European debts and should be constituted by countries of the eurozone meeting strict conditions.