Posts Tagged ‘EU budget’

An EU budget for the fifties not the future

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Wednesday, October 31st, 2012

This was the reaction of Swedish EU affairs minister Birgitta Ohlsson to the publication yesterday of the Cypriot Presidency’s revised proposal for the next EU multi-annual financial framework (MFF) covering the period 2014-2020. This is because it proposed big cuts in research and cross-border infrastructure while largely protecting the CAP budget in line with the Commission’s proposal.

The Commission has proposed a trillion euro budget (actually €1,091,551 million for EU-28 including off budget items) for the seven-year period which, depending on how the comparison is made, is seen as representing a 5% real increase in the resources available to the EU. The European Parliament, never shy about spending other people’s money, considers this a minimum amount and would prefer a higher increase. In the other arm of the budget authority, the Council of Ministers, opinions are split. The net recipients, grouped in the ‘Friends of Cohesion’ group, support the Commission proposal. The net payers, which form the ‘Friends of Better Spending’ group, want to rein back the Commission proposal to a real freeze in resources or even more. But there are differences within this group over whether the cuts should fall on the CAP or cohesion budgets (both of which are roughly 40% of the total) or on the remaining headings which account for just 20%. Not surprisingly, both the Commission and the Parliament’s Budget Committee reacted caustically to the Presidency proposal yesterday.

The Cyprus Presidency proposal explicitly sets out the implications of how a reduction in €50 billion might be made, while recognising that in the negotiating endgame further cuts will be required. The following graphic shows how it proposes the cuts should be made (all changes relative to the Commission’s revised MFF proposal in July 2012). Further details on the makeup of these figures can be found in this post.

The protection of farm spending in the EU budget emerges clearly from these figures. While in the short-run the Irish authorities will be pleased with this outcome (even if they will not state this in public, we are negotiating after all), it is worth asking whether our longer-term interests would not be better served by a budget for Europe rather than a budget for farmers.