Monday

27th Feb 2017

Dogfight over EU budget could end in crisis, MEP says

EU institutions have two months to reach an agreement on next year's EU budget if the bloc is to avoid a new crisis, a senior MEP has warned.

Speaking to reporters of Tuesday (12 October), centre-right MEP Alain Lamassoure added that finding a mechanism to enable Brussels to raise its own funding could no longer be ignored.

Dear EUobserver reader

Subscribe now for unrestricted access to EUobserver.

Sign up for 30 days' free trial, no obligation. Full subscription only 15 € / month or 150 € / year.

  1. Unlimited access on desktop and mobile
  2. All premium articles, analysis, commentary and investigations
  3. EUobserver archives

EUobserver is the only independent news media covering EU affairs in Brussels and all 28 member states.

♡ We value your support.

If you already have an account click here to login.

The two issues have become increasingly linked after MEPs in the European Parliament's budgets committee last week proposed a package of amendments to the EU's draft 2011 budget, published by the commission earlier this year.

Among the new lines inserted by the euro deputies in the draft document was a demand for member states to open negotiations on new 'own resources', adding that this element is a "full part of the overall agreement on the 2011 budget."

With several member states directly opposed to the idea of a self-funding EU, the battle looks set to escalate next week when negotiators from the two sides meet.

"I am hopeful that that each institution will have the heart to reach a consensual agreement. If not we will be in crisis," said Mr Lamassoure, a former French minister for European affairs and current chair the European Parliament's budgets committee.

EU financing arguments have precipitated major European crises in the past, including the 1965 'empty chair' policy adopted by French President Charles de Gaulle in response to a commission proposal to raise its own resources to pay for the common agricultural policy.

This time round, Mr Lamassoure and other MEPs are seeking to frame the issue of own resources as way to reduce national contributions to the EU budget at a time of European austerity.

As both governments and national parliaments would have to approve any change is this direction, Mr Lamassoure says he is open to any revenue-raising ideas that could garner the support of this 'double unanimity'.

"If our citizens are furious against the banks which led us into the current crisis, and they find it acceptable to make them pay, either by a direct tax or one of profits - moi je dis bravo," he added.

Some form of financial tax is expected to be among the list of potential funding mechanisms proposed by the commission next Tuesday in its 'budget review' of the current spending period (2007-13).

The following day MEPs will discuss the issue during a plenary session in Strasbourg and vote on the budget committee's list of amendments to the draft 2011 budget. A 'conciliation' committee with representatives from parliament and member states will then have 21 days to agree on a joint text regarding the 2011 spending blueprint.

"We are not closed to the reflection on own resources but it is clear that we can't have additional income for the EU, it must replace existing sources," a French diplomat told this website. "The second issue is that we can't increase the fiscal pressure on our citizens," they added.

One thing is clear however, says Mr Lamassoure. "It must not be called a 'European tax'. Once you mix the words 'Europe' and 'tax' in the same sentence it becomes explosive."

Adding to the volatile nature of the upcoming talks are MEP demands to see the commission's €130 billion budget proposal increased in size, while member states have already indicated they want this figure for next year's EU spending to be reduced by €3.6 billion.

MEPs defend budget increase in time of austerity

MEPs have voted by a vast majority to increase next year's EU budget by 5.9 percent, a move they define as "responsible" despite government spending cuts in member states.

Column / Health Matters

The yin and yang of traditional Chinese medicine

Can traditional medicine help the modern European patient? Malta has signed an agreement with China that would increase the provision of traditional Chinese medicine to its citizens.

Column / Brexit Briefing

Searching for a voice and a standard bearer

As Britons come to terms with the reality of Brexit many Remainers are now listless, looking for someone to present a viable alternative to Theresa May's dominance

Opinion

The Lake Chad Basin crisis

With no end in sight to the "tragedy", humanitarian agencies must call for international political and security engagement, the UN's head of migration says.

Column / Brexit Briefing

Searching for a voice and a standard bearer

As Britons come to terms with the reality of Brexit many Remainers are now listless, looking for someone to present a viable alternative to Theresa May's dominance

News in Brief

  1. Spanish court jails former IMF chief Rato
  2. Macron proposes Nordic-style economic model for France
  3. Germany posts record high budget surplus
  4. Labour ousts Ukip in Brexit homeland
  5. Dutch lower house approves EU-Ukraine treaty
  6. WTO says Russian pork ban was illegal
  7. Belgian nuclear plant made 'significant progress' on safety
  8. Report: Commission gauging EU support for Poland sanctions

Stakeholders' Highlights

  1. EURORDISJoin Rare Disease Day and Help Advocate for More Research on Rare Diseases
  2. European Healthy Lifestyle AllianceStudents Who Are Considered Fit Get Better Grades in School
  3. QS World MBA TourMeet with Leading International Business Schools in Paris on March 4th
  4. Malta EU 2017Economic Governance: Agreement Reached on Structural Reform Support Programme for Member States
  5. Socialists & DemocratsWomen Have to Work Ten Years Longer to Match Lifetime Earnings of Men
  6. Counter BalanceTrans-Adriatic Pipeline Is a Major Risk for Banks, Warns New Analysis
  7. Martens CentreEU and US Migration Policies Compared: Join the Debate on February 28th
  8. Swedish EnterprisesTechnology and Data Flows - Shaping the Society of Tomorrow
  9. UNICEFNearly 1.4 Million Children at Risk of Death as Famine Looms Across Africa and Yemen
  10. Malta EU 2017End of Roaming Fees: Council Reaches Agreement on Wholesale Caps
  11. Nordic Council of MinistersNordic Innovation House Opens in New York to Help Startups Access US Market
  12. Centre Maurits CoppietersMinorities and Migrations