Centre-left parties across Europe could shore up their slipping credibility by tackling the big issues on a broader stage

With Munich matched against Dortmund in the Champions League final at Wembley tonight, today is a day to remind us once again that Germans are uncommonly good at football. But they have always been pretty decent at centre-left politics too. No centre-left political party in Europe – and perhaps no centre-left party in the world – has been as important over the decades as Germany's Social Democratic party (SPD). Certainly no centre-left political party has a history to match that of the SPD, which gathered in Leipzig this week to mark the 150th anniversary of its foundation there in 1863 under the leadership of Ferdinand Lassalle.

But this week's gathering was not just of historical interest. Few parties have grappled more conscientiously or more often – and sometimes at greater cost – with the big questions that face democratic parties of the centre-left in dramatically changing times. That was true in the eras of the party's legends – Bernstein, Bebel, Ebert, Brandt and Schröder among them. And it is still true today in the era of Peer Steinbrück, the SPD's candidate to replace Angela Merkel – who was a guest in Leipzig this week (they do these things differently in Germany) – as chancellor in September's elections.

These are historically difficult times for the SPD. When Willy Brandt became postwar Germany's first social democratic chancellor in 1969, the SPD took 44% of the votes. When Gerhard Schröder became the first SPD chancellor since reunification, in 1998, the party won 41%. But in 2009, in Germany's most recent general election, the SPD polled a record low of 23%, its worst result of modern times. Today, with a general election only four months away, the polls look little better. Under Mr Steinbrück, the SPD has barely improved on its 2009 share. The latest Infratest dimap poll for ARD television yesterday has the SPD on just 27%.

In some respects this is an unfair verdict on the SPD's modern achievements. Germany's prosperity, export-led boom and continuing position as the dominant economy in the eurozone – the source of continuing security among German voters – owes at least as much to Mr Schröder's Agenda 2010 labour market reforms during his last term as chancellor a decade ago, as it does to Mrs Merkel's pragmatic but cautious handling of the global financial crisis since she ousted Mr Schröder in 2005.

Yet a significant segment of SPD voters have never forgiven Mr Schröder for his welfare-to-work cutbacks on long-term benefits to the unemployed. Mr Steinbrück is struggling to win these voters back. Today, the party remains divided between a more uncompromising left wing and a more pragmatic right – a bit like it was in Bernstein's time a century ago.

The SPD is not alone in that. France's socialist president François Hollande, who spoke in praise of Mr Schröder's reforms in Leipzig this week, has just notched his worst net approval ratings – minus 47 – since becoming president. Ed Miliband, also briefly in Leipzig before, maybe unnecessarily, putting the Woolwich murder first, boasts higher party ratings, but still trails David Cameron in the polls as preferred prime minister. Across Europe, most centre-left parties are losing credibility.

One reason these parties are in eclipse is that they promise security and fairness but struggle to deliver on the national level. If modern capitalism is to be made to act responsibly over issues such as tax havens, financial transactions and bank regulation, centre-left parties need to grasp that these issues are better gripped on a broader stage. It is surely at least worth considering whether Europe's centre-left parties would have more credibility if they could offer a Europe-wide programme. It would be a positive alternative to the pull-up-the-drawbridge message of parties such as Ukip in next year's European elections. Parties of the centre-left unite. You may not have a world to win. But a better election showing would surely be a start.

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German chancellor tops list of most powerful women for third year running, while Queen drops 14 places to 40th

The Queen and JK Rowling are once again the only two British women to feature in the Forbes Most Powerful Women list, which has been led by Angela Merkel for the third year running.

The German chancellor is ranked ahead of Brazil's president Dilma Rousseff, Melinda Gates, who co-chairs the Bill and Melinda Gates Foundation, Michelle Obama, and Hillary Clinton.

The Queen dropped from 26 to 40 on the 2013 list, while the Harry Potter author JK Rowling slipped from 78 to 93.

The list was heavy on top politicians, featuring nine heads of state who run nations with a combined GDP of $11.8tn. Merkel – who has been placed at the top of the Forbes ranking seven times – headed the list again, ahead of Rousseff, who came to power in Brazil in 2011. Hillary Clinton, who has featured in every Most Powerful Women list since the inaugural ranking in 2004, is in fifth place. Despite resigning as secretary of state earlier this year, Clinton remains one of the biggest political hitters on the international stage. The only former first lady to become a US senator, she is now hotly tipped to become the 2016 Democratic presidential candidate.

Clinton was one place behind the woman already in the White House, First Lady Michelle Obama, who climbed three places to reach fourth.

Apart from Clinton, there are 14 on the 2013 list who appeared on the inaugural list a decade ago: the head of the IMF, Christine Lagarde (7), Sonia Gandhi (9), Indra Nooyi, the chief executive of PepsiCo (10), chatshow host Oprah Winfrey (13), UN administrator Helen Clark (21), ABC chief Anne Sweeney (24), Sony Pictures co-chair Amy Pascall (36), the Queen (40), Fidelity president Abigail Johnson (60), Ho Ching, chief executive of Singapore state investment firm Temasek (64), news anchor Diane Sawyer (73), JK Rowling (93) and Fox news anchor Great Van Susteren (97).

The list features 24 corporate chief executives in control of $893bn in revenues, 16 of them founders of their own companies, including two of the three new billionaires to the list, Tory Burch and Spanx's Sara Blakely. The 14 billionaires featured in the list are valued at more than $82bn, according to Forbes.

Among the world's most powerful women are Africa's first female head of state, Liberia's Ellen Johnson Sirleaf, the first woman chief executive of at IBM, Ginni Rometty, and the first president of an Ivy League and of the Rockefeller Foundation, Judith Rodin.

Providing both light entertainment and philanthropy, Angelina Jolie (37), Shakira (52), Gisele Bundchen (95) and Beyoncé (17) were all recognised for their charity work.

There was a strong showing for women in Asia. Park Geun-hye, the South Korean president, comes in at 11, while Burma's pro-democracy leader, Aung San Suu Kyi, was at 29. After showing her mettle in the Australian parliament - where she gave the leader of the opposition a dusting-down and accused him of sexism – Australian PM Julia Gillard featured just behind in 28th position, with Thai prime minister Yingluck Shinawatra at 31. Asian entrepreneurs Zhang Xin (50), Sun Yafang (77) and Solina Chau (80) all made the list, as did Kiran Mazumdar-Shaw, India's first biotech entrepreneur.

Facebook's Sheryl Sandberg (6), Rometty (12) and HP's Meg Whitman (15) all represent women working in technology, while in the world of fashion, Miuccia Prada, Zara founder Rosalia Mera and Diane von Furstenberg all made an appearance.

Moira Forbes, president and publisher of ForbesWoman, said: "This year's Power Women exert influence in very different ways, and to very different ends, and all with very different impacts on the global community.

"Whether leading multibillion-dollar companies, governing countries, shaping the cultural fabric of our lives or spearheading humanitarian initiatives, collectively these women are changing the planet in profoundly powerful and dynamic ways."

The top 10

1. Angela Merkel, German chancellor

2. Dilma Rousseff, president of Brazil

3. Melinda Gates, co-chair, Bill & Melinda Gates Foundation

4. Michelle Obama, US First Lady

5. Hillary Clinton, former US secretary of state

6. Sheryl Sandberg, COO, Facebook

7. Christine Lagarde, managing director, IMF

8. Janet Napolitano, US homeland security secretary

9. Sonia Gandhi, president, Indian National Congress party

10. Indra Nooyi, CEO, PepsiCo

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Tax avoidance, François Hollande and the French economy will all come under the spotlight this week in Brussels

Tax dodgers will get an earful this week in Brussels. With public outrage soaring over the perceived failure to pay their dues by the likes of Amazon, Eric Schmidt's Google and other squillion-dollar transnationals, European leaders will feel bound to berate and deplore, bemoan and declare. And that will pretty much be that.

An EU summit on Wednesday in Brussels will declare combatting tax evasion and VAT fraud to be the next big common European endeavour. David Cameron will claim credit for the offensive and seek to salvage his dwindling authority – at home and in Europe – by promising to put tax dodgers at the top of the G20 agenda.

There is certain to be enough hot air to propel the 30 leaders ballooning over Brussels. But a draft of what the summit will decide, obtained by the Guardian, shows that they will decide very little. The eight-page document drafted on Friday speaks of "reflecting" on this, "accelerating" that, "responding" to this. And returning in December to have another try at policy-making which has been stuck for years because of resistance from banking secrecy havens such as Austria and Luxembourg.

The real game-changing moves in the effort to clamp down on corporate tax dodging are coming from the Obama administration. "The US pressure is immense," said an EU diplomat. "It's a real steamroller going on at a global level."

The Europeans are playing catch-up. But they won't catch up this week. Instead, the real heavy lifting, leading to another, more important summit next month, is an almighty tussle over how to emerge from four years of financial and currency crisis. More the political than the financial fallout. How, when, and in what form should economic and fiscal policy-making be pooled in the eurozone in order to put political flesh on the very brittle bones of the currency union, a fragility cruelly exposed by the turmoil of the past three years?

This is crystallising into a straightforward Gallic-Teutonic contest, with a weak President François Hollande in Paris issuing challenges to a strong Chancellor Angela Merkel in Berlin who blithely ignores the French entreaties.

A detailed survey of eight EU countries last week from Pew, the US pollsters, underlined the yawning gap between France and Germany and Berlin's isolation on the euro crisis. Number-crunching the sophisticated data, the pollsters concluded that the Germans were living on a different continent from the rest of the EU, such were the divergent views.

Guido Westerwelle, the German foreign minister, is alarmed at the implications of this for Germany's image and place in Europe and the world. But Merkel seems quite unfazed, happy to be the whipping girl for everyone else's frustrations provided the policies work – the aim being to get Europe fit, competitive and efficient for the global contest that could leave it lagging at the back.

As long as the eurozone's hospital ward keeps taking the medicine and the pills are working, the patients can whinge all they like about the German doctor. This is the impression that Merkel gives.

Hollande, in what appeared an attempt to show that he is not asleep at the wheel, last Thursday set out his vision for the eurozone, for the first time in any detail. Predictably, it clashed utterly with Berlin's. It was very French, almost identical to proposals previously tabled by his predecessor, Nicolas Sarkozy, and previously rejected by Merkel. Hollande said he wanted a eurozone government within two years, with its own budget, tax base, and eventually pooled debt issuance or eurobonds. The idea is that Hollande and other national eurozone leaders would meet once a month to decide policy, supported by a new eurozone secretariat.

But after three years of crisis management, it is absolutely clear that the Germans will not accept liability for anything they do not control. That means eurobonds or German taxpayers' money being used to finance other governments automatically will not happen for a very long time. Nor will the Germans countenance a common eurozone fund that would be used to prop up other countries' stricken banks.

"It's a good relationship, but very difficult," said Peter Altmaier, the German environment minister. "There are things that the French don't understand about Germany and that Germans don't understand about France."

In public, the Germans are wary of lecturing the French about how to put their own house in order. The Dutch are less shy. The prime minister, Mark Rutte, responded to Hollande's blueprint by telling him to forget about Europe and to tackle France.

As France wrestles with recession, soaring unemployment, missed debt and budget targets, and structural stagnation, Merkel also is keen to see Hollande get to grips with a domestic agenda.

The European commission has agreed to give Hollande an extra two years to meet the euro rules on the budget deficit target of 3% of GDP. But Berlin is leaning strongly on the commission to force structural economic reforms on France in return for the concession. "France is the really big concern," said Norbert Barthle, of Merkel's Christian Democrats. "We're prepared to give them two years but right now [commissioner] Olli Rehn has to connect this to strict conditions. Binding. Otherwise the German government will not support it."

There is a long history of Franco-German friction at the heart of the EU. But things have rarely been so imbalanced as they are now. As the summits come and go, it will be September at the earliest, when Merkel hopes to win a third term, before serious accommodation can begin to be reached on both sides of the Rhine.

"Hollande's and Merkel's ideas on European economics are so far apart," said Munich's Süddeutsche Zeitung on Saturday. "The economic dynamics are working in Merkel's favour. So Merkel is playing a waiting game. If she's re-elected, he will have to move."

Five things to watch out for

• Monday sees the first in a series of votes on the same sex marriage bill, with rebellious Tory MPs threatening to derail its passage with an amendment to extend civil partnerships to heterosexual couples.

• Major Tim Peake will be announced on Monday as the UK's first 'official' astronaut in 20 years. He will join the crew on the International Space Station in 2015.

• On Wednesday the IMF will be in London to deliver its annual verdict on the health of the UK economy.

• The Hay Festival of arts and literature begins on Thursday in Herefordshire.

• In the first all-German Champions League final, Bayern Munich face Borussia Dortmund at Wembley stadium on Saturday night.

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