Germany's CSU to fight European election on eurosceptic platform

ANDECHS, Germany (Reuters) - Germany's Bavarian conservatives, sister party of Chancellor Angela Merkel's Christian Democrats (CDU), on Saturday agreed a manifesto for the European elections aimed at trying to hold on to voters tempted by more eurosceptic parties.

Policies outlined by the CSU include a proposal to secure Germany a veto on the European Central Bank's council, to drastically reduce the European Commission in size and to grant indebted euro zone states the right to go bankrupt.

Merkel does not back these moves so they are highly unlikely to become government policy, but the manifesto highlights fears among German conservatives they will lose voters to the anti-euro AfD, polling a little above 5 percent, in the May 22 vote.

"Europe must be turned on its head," states the programme passed on Saturday in Bavaria, describing the EU as a "project of the political elites".

The CSU, which shares power with Merkel's CDU and the centre-left Social Democrats, traditionally takes a more sceptical approach towards the EU than the CDU. It favours referendums on some EU policies and curbs on immigration from EU members Bulgaria and Romania.

The CSU, like the CDU, is part of the EPP conservative grouping in the European parliament.

Polls show that conservative parties, currently the biggest grouping in the European parliament, could lose out in the elections. A wave of eurosceptic sentiment around Europe, including in Britain, France, Austria and the Netherlands, could erode their support.

The AfD was formed about a year ago by academics, journalists and business people when the euro crisis was raging, and called for an end to the currency.

It scored 4.7 percent in Germany's federal election last year, just short of the threshold needed to enter the Bundestag, the lower house, but has since gained slightly in popularity.

(Reporting by Irene Preisinger; Writing by Madeline Chambers; Editing by Andrew Roche)