Oh, OK. I mostly picked "foreign policy" as you'd used that in your original article, and I didn't recall them having one off the top of my head. I imagine there is some other part of central government that would be required for an effective federation, but which the EU does not currently implement.

As for the centralisation/devolution dichotomy, I think Bruce Schneier's article criticising the creation of the US DHS has a recommendation that sounds like the direction I currently think governments should be headed - centralise co-ordination as globally as possible; distribute responsibility and implementation as locally as possible.