19th Mar 2018

New EU budget proposal cuts across red lines

  • Summit room - EU budget hawks have threatened vetoes in November (Photo: Valentina Pop)

The Cypriot presidency has proposed cutting €50 billion off EU spending plans for 2014 to 2020 - a number that could trigger national vetoes and strikes by EU staff.

The Cypriot paper, circulated late on Monday (29 October), said spending should be "at least" €50 billion less than the European Commission's figure of €1,033 billion over the next seven years.

Thank you for reading EUobserver!

Subscribe now for a 30 day free trial.

  1. €150 per year
  2. or €15 per month
  3. Cancel anytime

EUobserver is an independent, not-for-profit news organization that publishes daily news reports, analysis, and investigations from Brussels and the EU member states. We are an indispensable news source for anyone who wants to know what is going on in the EU.

We are mainly funded by advertising and subscription revenues. As advertising revenues are falling fast, we depend on subscription revenues to support our journalism.

For group, corporate or student subscriptions, please contact us. See also our full Terms of Use.

If you already have an account click here to login.

It added: "According to the assessment of the presidency this is a starting point for delegations in order to reflect on the effects of reductions. More sizeable reductions are needed in order to reach a compromise."

Breaking down the cuts, Cyprus said cohesion funding - designed to help poor regions in the east and south of Europe to catch up - should go down from €495 billion to €472 billion.

Spending on farm aid and rural development should go from €386 billion to €379 billion. Funds for foreign policy are to remain more or less the same at €18 billion. Spending on pre-accession aid and global development should go from €70 billion to €65 billion.

It noted that money for EU institutions will also "have to be revised downwards" from the commission's €63 billion, but it did not give a new number.

With the biggest cuts to come on cohesion, the Cypriot idea will annoy the 13 eastern and southern EU countries in the so-called "Friends of Cohesion" group.

But the overall €50 billion reduction is set to face even bigger opposition from some of the 10 states in the so-called "Friends of Better Spending" club.

A "centrist" sub-group in the "better spending" alliance - containing EU paymaster Germany as well as Denmark, Finland and France - had earlier called for cuts of at least €100 billion.

A more hawkish element - containing the Netherlands, Sweden and the UK - wants to go further by cutting €115 billion to €130 billion off the commission's proposal.

The UK and the Netherlands have threatened to veto an EU budget deal at an upcoming summit in November if they do not get their way.

Swedish sources are also saying "the content of the deal is more important than the timing ... We also have a very strong position."

The Cypriot paper touches on the thorny question of national rebates.

It includes, in brackets, a commission idea to take away the UK's permanent rebate, in favour of "lump sum" rebate payments for the 2014 to 2020 period.

But, given the UK's rejection of the plan last week, it adds another option: "[The existing correction mechanisms in the current system of own resources of the European Union will continue to apply]."

It says nothing about a Danish plea for a €150 million-a-year rebate for Copenhagen - the subject of another veto threat.

Top EU officials have already warned the November summit could last as long as four days.

For its part, the EU commission on Tuesday morning said: "This [Cypriot] negotiating box is not supported."

"There are many in this city who believe there can be a deal, but just as many who think it will be difficult," an EU source said.

Meanwhile, amid the talk of further slashing pensions and perks for EU officials, things could get messy in the EU capital.

EU trade unions also on Monday announced a strike on 8 November, with an added warning of further strike action on 16 November if their position is not taken into account.

Correction: the original story said Finland wants cuts beyond €100 billion. In fact, it is in the "centrist" group with France and Germany

UK threatens to veto EU budget

British conservative Prime Minister David Cameron has said he will block the upcoming EU seven-year budget cycle if it goes against UK interests.

Merkel in Paris for eurozone reform talks

Angela Merkel - who started her fourth term as Germany's chancellor earlier this week - is wasting no time on big issues like eurozone reforms. On Friday she is meeting Emmanuel Macron where the two will seek common ground.

VW dismisses complaints on Dieselgate fix

'I think customers who want to get information (...) are able to receive information if they want," VW management board member Hiltrud Werner told EUobserver. Consumer groups disagree.

Stakeholders' Highlights

  1. Counter BalanceConmtroversial Turkish Azerbaijani Gas Pipeline Gets Major EU Loan
  2. World VisionSyria’s Children ‘At Risk of Never Fully Recovering', New Study Finds
  3. Macedonian Human Rights MovementMeets with US Congress Member to Denounce Anti-Macedonian Name Negotiations
  4. Martens CentreEuropean Defence Union: Time to Aim High?
  5. UNESDAWatch UNESDA’s President Toast Its 60th Anniversary Year
  6. AJC Transatlantic InstituteAJC Condemns MEP Ana Gomes’s Anti-Semitic Remark, Calls for Disciplinary Action
  7. EPSUEU Commissioners Deny 9.8 Million Workers Legal Minimum Standards on Information Rights
  8. ACCAAppropriate Risk Management is Crucial for Effective Strategic Leadership
  9. EPSUWill the Circular Economy be an Economy With no Workers?
  10. European Jewish CongressThe 2018 European Medal of Tolerance Goes to Prince Albert II of Monaco
  11. FiscalNoteGlobal Policy Trends: What to Watch in 2018
  12. Human Rights and Democracy NetworkPromoting Human Rights and Democracy in the Next Eu Multiannual Financial Framework

Latest News

  1. EU states pledge solidarity with UK on alleged Russian attack
  2. 'Decisive step' in Brexit ahead of EU summit
  3. Moria refugee camp is no place for people
  4. No free EU wifi for UK cities without Brexit deal
  5. Selmayr case symptomatic, warns EU novel author
  6. Germany: Russia is 'partner' despite alleged UK attack
  7. Kiev wants EU sanctions on former German chancellor
  8. North Korea: time to put the 'E' in engagement

Stakeholders' Highlights

  1. Mission of China to the EUDigital Cooperation a Priority for China-EU Relations
  2. ECTACompetition must prevail in the quest for telecoms investment
  3. European Friends of ArmeniaTaking Stock of 30 Years of EU Policy on the Nagorno-Karabakh Conflict: How Can the EU Contribute to Peace?
  4. ILGA EuropeCongratulations Finland!
  5. EUobserverNow Hiring! Sales Associate With 2+ Years Experience
  6. EUobserverNow Hiring! Finance Officer With Accounting Degree or Experience
  7. UNICEFCyclone Season Looms Over 720,000 Rohingya Children in Myanmar & Bangladesh
  8. European Gaming & Betting AssociationEU Court: EU Commission Correct to Issue Guidelines for Online Gambling Services
  9. Mission of China to the EUChina Hopes for More Exchanges With Nordic, Baltic Countries
  10. Macedonian Human Rights MovementCondemns Facebook for Actively Promoting Anti-Macedonian Racism
  11. Nordic Council of MinistersGlobal Seed Vault: Gene Banks Gather to Celebrate 1 Million Seed Collections
  12. CECEIndustry Stakeholders Are Ready to Take the Lead in Digital Construction