Tuesday

31st Mar 2020

Unpaid bills main hurdle in EU budget talks

  • The new budget proposal forsees a 0.7 percent increase on spending in 2014 to cover for part of the unpaid bills. (Photo: guysie)

Britain and the Netherlands no longer have a problem with the extra money they have to pay, but EU budget talks are still stuck due to disagreements on how to tackle a huge backlog of unpaid bills.

"For the first time in weeks I start to see the light at the end of the tunnel. We are not there yet, but I am cautiously optimistic," an EU source involved in the EU budget talks told this website after a meeting on Tuesday (2 December) between national diplomats, members of the European Parliament, and European Commission staff.

Read and decide

Join EUobserver today

Support quality EU news

Get instant access to all articles — and 20 years of archives. 14-day free trial.

... or join as a group

The acrimonious talks - a yearly phenomenon - revolve around a final amendment to the current budget for 2014 and adopting next year's budget. If no agreement is found by mid-next week, the EU budget will have to be rolled over on a monthly basis, which would pose problems for some EU-funded programmes, notably aid for farmers.

A group of Baltic farmers protested in front of the parliament on Wednesday, demanding more subsidies to offset a Russian import ban on EU fruit and vegetables and expressing concern over a possible budget blockade.

The 'cautious optimism' about a last-minute deal stems from one issue having been cleared up: the British and Dutch "corrections" to the EU budget, based on adjustments to the gross national income (GNI).

The Dutch government has agreed to pay its share by the end of December, while the UK will pay in July and September 2015, after its rebate is calculated in May.

Some countries have already paid their adjustments, to the tune of €3.3 billion in total, with the commission already redistributing €300 million to member states like Denmark, who are set to be compensated for having paid too much over the years.

"The corrections issue is now a constructive force in the debate," one EU official said.

But the more contentious issue for next year's budget is a huge backlog of unpaid bills from the so-called cohesion programme, which distributes billions to poorer EU member states for infrastructure projects.

Under its latest proposal tabled last week, the EU commission is asking member states to approve at least €4bn for these unpaid bills, so that the €28 billion backlog is stabilised and does not balloon further.

The European Parliament, for its part, wants to narrow the gap between what the EU 'commits' to pay next year and what it actually pays.

The new draft budget announced last week by the EU executive foresees €145.2 billion in commitments and €141.3 billion in payments, lower than the commission’s original proposal, but still a 0.7 percent increase on spending in 2014 to cover for part of the unpaid bills.

To the UK and "a large number of other countries", this is still unacceptable, as they want to limit spending at €140 billion, while the European Parliament is demanding at least €4 billion "over-the-ceiling" emergency spending for the unpaid bills.

Talks are set to resume over the next days with the aim of reaching an agreement by mid-next week.

Already doubts over Belgium's new 'anti-corona government'

Belgium's King Philippe has given interim prime minister Sophie Wilmès the task of forming a government, after seven opposition parties agreed to support it. The agreement came after a political drama - and there are doubts if it will hold.

News in Brief

  1. EU Commission: no 'indefinite' emergency measures
  2. Denmark plans 'gradual' return to normal after Easter
  3. Globally over 780,000 cases of coronavirus, 37,000 deaths
  4. EU states losing 3% of GDP a month, IMF says
  5. Fruit pickers need to cross borders too, EU says
  6. Former Slovak minister to become EU envoy on Kosovo-Serbia
  7. Hungary's Orban wins rule-by-decree vote in parliament
  8. Bars and restaurants remain open in Sweden

Five new post-Brexit MEPs to watch

Five MEPs to keep an eye on from the 27 new members who are joining the European Parliament this week, following the UK's departure from the EU.

Stakeholders' Highlights

  1. UNESDAMaking Europe’s Economy Circular – the time is now
  2. Nordic Council of MinistersScottish parliament seeks closer collaboration with the Nordic Council
  3. UNESDAFrom Linear to Circular – check out UNESDA's new blog
  4. Nordic Council of Ministers40 years of experience have proven its point: Sustainable financing actually works
  5. Nordic Council of MinistersNordic and Baltic ministers paving the way for 5G in the region
  6. Nordic Council of MinistersEarmarked paternity leave – an effective way to change norms

Join EUobserver

Support quality EU news

Join us