Friday

3rd Jul 2020

EU commission proposes six percent budget cut

  • EU officials are facing a race against time to agree the 2014-2020 budget (Photo: European Council)

EU spending will be slashed by 6 percent next year, according to the 2014 budget tabled on Wednesday (26 June) by the European Commission.

The bloc's structural and cohesion funds, which go to the poorest regions in the 27 member states, are set to be the main casualty, with reductions of 13.5 percent to €47.6 billion.

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Meanwhile, spending on the environmental side of the common agricultural policy is to be cut by 4.7 per cent.

Budget commissioner Janusz Lewandowski indicated the proposal had been tabled to meet treaty rules requiring the EU executive to table a budget by 1 July, but is open to revision.

"We will adjust our proposal later on in the light of the final outcome on the 2014-2020 Multi-annual Financial Framework [MFF]," he said.

As things stand, the EU institutions face a race against time to sign off on the long-term budget before the summer break.

Next week's plenary session in Strasbourg is the last before the summer recess.

Although talks between the parliament's lead negotiator, Alain Lamassoure, and the Irish presidency raised hopes that a deal had been struck last week, a series of MEPs later said said that the latest compromise offer was below their expectations.

In return for accepting a budget worth €960 billion, well below the €1 trillion initially proposed by the commission, MEPs have been insisting on mechanisms to allow funds to be rolled over between years and different budget headings.

They have demanded a full review of the budget in 2016 in the next legislature, hoping that EU economies will be in a position to increase spending.

They also want to set up a working group to assess the future of EU "own resources," such as an EU-levied tax.

On Wednesday, the parliament's Socialist group joined the Liberal and Green groups in stating that it would not sign off on the deal tabled last week by the Irish presidency.

The move leaves the centre-right EPP, the parliament's largest group, and the right-wing ECR as the only groups yet to declare their position.

A super majority of more than half the total number of MEPs is required to pass the MFF.

Hannes Swoboda, the Austrian leader of the Socialist group, described the latest offer as "not good enough."

"Although the Irish presidency did not always play fair with us and did not move far enough in the direction of the European Parliament's demands, we are ready for a compromise," he added.

Diplomats said EU leaders would hope to make progress on the MFF at tomorrow's EU summit in Brussels.

"There will be a lot of disorder if we can't get an MFF deal," said a UK contact.

A German source said that Berlin would do "everything it can to get a deal this week," adding that "there needs to be a deal now."

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