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9th Aug 2020

MEPs and ministers agree 2014 budget breakthrough

  • The budget deal means the commission can cover remaining bills for 2013 (Photo: europarl.europa.eu)

The long-running dispute on EU spending has moved a step closer to compromise after ministers and MEPs agreed an EU budget for 2014.

Under a deal clinched in the small hours of Tuesday morning (12 November), the 2014 budget now amounts to €142.6 billion in commitments and €135.5 billion in payments.

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The compromise is nearly €500 million more than the figure proposed by ministers, but €400 million less than the figure demanded by MEPs last month.

It represents a 9.4 percent drop in spending compared with the 2013 budget.

While all budget headings, apart from EU administration, face real term cuts compared with 2013 spending, EU cohesion funding, which includes structural funds to the bloc's poorest regions, faces the deepest cuts. Cohesion spending will fall by around €7 billion to €64 billion.

The deal also includes an agreement from governments to provide additional funds to cover the European Commission's outstanding bills for 2013.

An extra €3.9 billion will pay claims arising from Cohesion Policy.

Member states will also cough up more money to allow the EU's solidarity fund to pay out €400.5 million in compensation to regions in Austria, the Czech Republic, Germany and Romania, which were affected by violent floods last spring.

However, €150 million of these funds will be financed from next year's 2014 budget.

Speaking on Tuesday, EU budget commissioner Janusz Lewandowski said the agreement would provide "much needed investment opportunities  to Europe's businesses, scientists, towns, regions and students at a time when investing is much needed."

He added that the deal marked a "crucial step" towards sealing agreement on the bloc's next seven year budget.

MEPs have delayed their final vote on the the EU's 2014-2020 multi-annual financial framework (MFF), until governments provide the money needed for the commission to avoid a cash-flow crisis.

The agreement now requires the final approval of MEPs at next week's plenary session in Strasbourg.

Failure to adopt the budget before the end of the year would see the EU operate on the basis of the 2013 budget adjusted for inflation.

For his part, Lithuanian deputy finance minister, Algimantas Rimkunas, who brokered Tuesday's talks on behalf of EU governments, commented that 2013 and 2014 spending deal "does not put more burden" on the EU's cash-strapped governments, but "ensures that money is spent on the most important priorities such as youth employment and supporting small and medium-sized enterprises."

"We have also managed to agree that there will be sufficient margins so that the EU is able to respond to unforeseen situations requiring additional expenditures," he added.

But Alain Lamassoure, the chairman of the European Parliament's budgets committee, was less enthusiastic, describing the deal as being merely "decent" enough.

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