LONDON Feb 29 Czech Prime Minister Petr Necas said on Wednesday the European Union's new fiscal compact was not much of an improvement on the old stability pact but did not rule out the Czech Republic joining it one day.
At a European Union summit last month, the Czechs and the British were the only two states in the 27-member bloc to shun a deal to strengthen fiscal responsibility in the euro zone, drawn up in response to the region's debt crisis.
Necas repeated on Wednesday that the Czech Republic would not sign the new fiscal compact, which is due to be signed by other EU leaders at a Brussels summit on Friday.
Speaking at the London School of Economics, he said the next step after a fiscal union in the euro zone would be a tax union - something the Czechs have consistently opposed.
Nevertheless, he said the Czech 'no' to the fiscal compact "does not mean a final or irrevocable no".
"As part of the negotiations regarding the fiscal compact, the Czech Republic achieved the change of Article 15 of the compact which makes it possible for the Czech Republic to join the fiscal compact in the future if it chooses so," he said.
"If you look at the accession treaty we are still bound ... by the rule on adopting the euro ... should a country outside the euro zone choose to adopt the euro it automatically has to sign several agreements and one of them is the fiscal compact," he said.
The Czech Republic does not use the euro and has not set a date for its adoption.
Necas said he advocated a system in which a breach of budgetary discipline in the euro zone, either by breaking deficit rules or an increase in indebtedness, would trigger automatic sanctions.
"The so-called fiscal compact does not actually answer these problems. There are no debt criteria included in the compact - just the deficit criteria," he said.
"There is no system of automatic sanctions that would be triggered. The decision is left up to the European Commission and at times such decisions are very politically motivated," he said, speaking at times in English and at other times through an interpreter.
"So I think in this regard the fiscal compact does not really represent any significant improvement in comparison with, for instance, the stability pact," he said.
Necas brushed aside a question about whether his visit to Britain just before the EU summit was an attempt by the two countries that have refused to join the fiscal compact to form a "gang of two".
He said his visit now was coincidental and had been long planned.
Necas is due to hold talks with British Prime Minister David Cameron in London on Thursday and the two leaders will then travel together to Brussels for the EU summit.
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