Merkel under fire for siding with Cameron on EU budget

Steinbrueck, who will challenge Merkel for the chancellery in general elections on 22 September, accused her of being a "last-minute chancellor", whose decision-delaying tactic is costing both the German taxpayer and other EU countries more than it should.

He said the €960bn deal on the EU's 2014-2020 budget was the result of a "strange alliance between Merkel and Cameron who wants to leave the EU."

"We need partners who see their future in Europe and do not rely on those who want to leave," Steinbrueck said, in reference to Cameron's announcement he wants to renegotiate the terms of Britain's membership and hold a referendum on the results in 2017.

For her part, Merkel and her allies defended the decision not to isolate Britain - whose uncompromising stance on budget cuts helped derail a first attempt for a deal back in November.

"Very few thought this deal was possible because the positions were very far away from each other. In November we didn't go for a deal without Britain and now we achieved one for all 27 members because Herman Van Rompuy led the negotiations in a very smart way and because leaders showed willingness to compromise," Merkel said.

In her view, Germany "achieved all its goals": capping the EU budget at one percent of EU's gross national income or €960bn, "a reasonable ceiling."

Merkel defended the fact that this would be the first ever austerity budget for the EU, saying it is more acceptable in the current economic climate.

"Nobody would understand when all need to tighten the belt in Europe, but not Europe itself," Merkel said.

The German chancellor urged the European Parliament to approve the deal and pointed to two concessions she made in order to meet their demands for more money.

Firstly, Germany reluctantly agreed to more "flexibility" on unspent money, which normally flows back to member states each year.

Secondly, there would be a revision clause after the EU elections next year, with the possibility to "adapt the budgetary framework, because seven years is a long time."

"Without agreement with the European Parliament, there would be no budget at all. So let's look at common things, not at what divides us," Merkel said.

Juergen Trittin, the Green leader tipped as finance minister in a coalition with the Social Democrats if they win the elections in September, pointed to Merkel's hypocrisy in demanding budget cuts and austerity measures when her government did the exact opposite when faced with the fallout of the financial crisis in 2008.

"Why do you force on Europe something you don't practice at home? In 2008, Germany made massive investments against the crisis and its debt went up from 63 to 85 percent of GDP. Don't pretend it wasn't you doing it," Trittin said.

He also said it was "irresponsible" to cut EU subsidies for solar and wind energy while keeping up payments to big agribusinesses that have lobbied the German government intensively.

"You were as cowardly as Cameron, who gives in to his own eurosceptic party and an irresponsible opposition. Instead of fighting for Europe, you gave in," he told Merkel.

Michael Roth, a Social Democrat, summed up the opposition's charges: "Cameron still enjoys his rebate, Merkel defends the agribusiness lobby, while countries are in crisis, with 5.7 million youngsters out of a job. Shame on you for this result."