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28th Aug 2016

EU parliament sets pre-conditions for budget talks

Governments must cover the EU's old budget debts before a deal can be reached on the bloc's next seven year budget, MEPs decided on Wednesday (13 March).

Deputies in Strasbourg voted by a 509 to 161 margin to back a resolution setting out the parliament's negotiating stance on the "multi-annual financial framework" (MFF) expected to start in 2014.

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  • MEPs demand an emergency budget to cover unmade payments, worth around €2.9 billion, from 2012 (Photo: European Parliament)

EU leaders agreed a deal worth €960 billion in commitments and €908 billion in payments at February's budget summit, a 3 percent real terms cut.

However, the parliament insisted that it would not open negotiations until governments agreed to fund an emergency budget to cover unmade payments, worth around €2.9 billion, from 2012.

The resolution also calls on governments to agree a "political engagement" to guarantee funding for 2013 spending.

The EU assembly's other main demands were the creation of a flexibility mechanism allowing money to be shifted between years and budget headings. It also wants agreement to hold a mid-term review of the budget following next year's European elections.

Alain Lamassoure, who chairs the parliament's budget committee, said that the "extremely important" vote marked the start of a long battle with governments who had ignored "repeated warnings" from MEPs about funding shortfalls.

He slammed the horse-trading between governments as "political and budget cronyism at its worst," adding that "envelopes with figures were being handed out to member states. That simply cannot go on."

Assuming member states make good on the 2012 budget shortfall demands, talks between MEPs and ministers on the MFF are expected to start quickly.

For her part, Irish Europe minister Lucinda Creighton, who will attempt to broker a deal in the remaining three months of the Irish presidency, indicated that there were "grounds to meet some of the parliament's concerns."

However, she warned that the package agreed by government leaders was a "solid outcome… at the limit of what was possible."

In a swift riposte, Lamassoure insisted that MEPs would not be browbeaten by ministers.

"We're not going to drag this out but if we can't reach an agreement we'll wait until the European elections," he said.

The upcoming negotiations will also look at legislation, including reform of the Common Agricultural Policy, which is dependent on funding levels in the MFF.

Meanwhile, the parliament's President, Martin Schulz, a German centre-left MEP, told reporters that parliament "would not negotiate on money" but wanted to "improve the structure" of the budget.

He noted parliament would be a "serious partner" in talks expected to be "hard and tough."

He added that the EU should not go "in the direction of becoming a deficit union".

That said, by accepting the headline budget figures agreed by member states, the Parliament's position is widely seen as a setback to Schultz who had indicated that MEPs would demand additional funds for the budget.

MEPs also rejected Schultz' plan to hold a secret vote on the budget.

An amendment tabled by the conservative ECR group for an open ballot was backed by 553 MEPs, with only eight MEPs supporting a secret vote.

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