By Jan Strupczewski and Francesco Guarascio
BRUSSELS (Reuters) - The European Commission proposed on Wednesday ideas for deeper euro zone integration in an effort to help unite the broader European Union, as eurosceptic sentiment grows across the EU and Britain prepares to leave the EU in 2019.
The Commission, the EU's executive arm, presented a package of proposals aimed at giving the 19 countries sharing the euro better protection against future financial crises.
But plans to tighten cooperation among the 19 euro countries have sparked concern among the eight non-euro countries that they will become second-class members of the EU, with less say - and less funds - in the future.
To alleviate those fears, the Commission proposals stressed that all their proposals were open to all EU members, even though that clashes with the thinking of some euro zone leaders, such as French President Emmanuel Macron.
Macron has called for creating a euro zone budget of several hundred billion euros, a euro zone finance minister and a euro zone parliament.
But instead, the Commission proposed creating cash incentives for countries that embark on structural reforms. It also proposed helping financially the economies of non-euro countries, all of which - except Denmark - are obligated to adopt the single currency at some point.
The Commission also backed the idea of setting up what it calls a euro zone "stabilisation function", because the monetary policy of the European Central Bank cannot deal with economic crises that hit only one or a few countries in the euro zone.
That proposal calls for a pool of money to protect investment in the event of shocks to a few euro zone countries. The Commission did not say how big the fund should be.
Instead of a euro zone finance minister, the Commission called for naming a pan-European Minister of Economy and Finance, who would also be a senior member of the European Commission and chair meetings of euro zone finance ministers.
The job might be created when the next European Commission starts work in November 2019, the Commission said.
Under the current arrangement, the chair of the euro zone finance ministers, the closest thing the bloc now has to a single finance minister, often testifies before the parliament's economic committee, but it has no power over him or her.
Euro zone finance ministers have little enthusiasm for allowing the Commission, which is only an observer at their monthly meetings, to chair the talks.
Other euro zone integration ideas, floated by Germany, include transforming the euro zone's government-owned and run bailout fund into a European Monetary Fund.
The Commission backed that idea, but said the EMF should become an EU institution, which would be overseen by the European Parliament -- an idea officials have said would not fly with governments. The EMF would also provide a 60 billion-euro backstop for the bank-funded Single Resolution Fund.
The Commission did not address the proposal of Germany and backed by Slovakia and the Netherlands to create a sovereign insolvency mechanism that would put pressure on governments to conduct prudent fiscal policy.
(Reporting By Jan Strupczewski; Editing by Hugh Lawson, Larry King)