Liberals suggest scrapping some EU institutions

Possible savings can be made by "fundamentally restructuring certain parts of the EU administration, such as the Committee of Regions ... [and] abolishing the European Economic and Social Committee (EESC) and others," says the document.

The group also calls for the European Parliament's shuttling between Brussels and Strasbourg to come to an end through the creation of just one fixed seat, together with spending cuts for EU programmes whose aims have already been achieved or whose goals are "dubious", such as support for tobacco production.

In response, EESC officials stressed that their institution's budget is "tiny", representing just 2.56 percent of the EU's overall administrative budget, and brings important added-value to the union's work.

Europe's post-2013 financial framework has already proved contentious, with the battle set to increase this year.

Leaders from Britain, France, Germany, Finland and the Netherlands sent an open letter to European Commission President Jose Manuel Barroso last December, calling for any rise in the size of the post-2013 multi-annual framework to remain below inflation.

Parliament's Liberals on the other hand want a redirecting of current funding, away from areas such as agriculture and towards the EU's 2020 strategy for growth and jobs.

At the same time, more recently joined EU member states are calling for their EU farm payments to be brought into line with older members. Latvian farmers currently receive €98 per hectare in direct payments, while Greek farmers receive €580.

An unofficial Latvian position paper on CAP reform, seen by EUobserver, calls for the creation of new upper and lower limits, under which per hectare payments would vary between €200 and €300, depending on farming costs and per capita GDP in a specific country.

Latvian centre-right MP Imants Liegis, in Brussels on Tuesday to speak to EU agriculture commissioner Dacian Ciolos, said Europe's poorest regions must be protected.

"Even if the CAP budget were decreased, we would hope that Latvian farmers would still receive increased payments," he said. "Solidarity should also prevail in Europe's cohesion policy payments."

The European Commission is due to come forward with formal proposals on the EU's next long-term budget and farm policy before the summer.