Sunday

12th Jul 2020

Magazine

The EU debate on its own resources

  • Johan Van Overtveldt (ECR, Belgium) the president of BUDG committee (Photo: EP)

In May 2019, the European Commission proposed to increase the EU budget from 1.03 percent to 1.11 percent of all European economies combined.

This figure will be the basis of the debate on the so-called Multi-Annual Financial Framework (MFF), which is Brussels-bubble speak for the EU budget for the next seven years.

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 subscribe as a group

The last MFF started in 2014 and ends in 2020. The next one will start in 2021 and end in 2027.

The increase was then seen as high, but less so than expected.

Compared to this other federation, the United States, one percent is still a very low number, as the federal government in Washington has a budget of around 20 percent of the GDP of the country.

Until the First World War however, the US federal budget was not much higher than one percent too, with the postal service as the largest federal budgetary post.

In other words, the EU budget is still rather small. But this doesn't mean that the discussions on the next MFF will not be substantial.

Johan Van Overtveldt (ECR, Belgium), the president of the committee that coordinates the discussions on the MFF, or BUDG, obviously sees "reaching an agreement on the next MFF" as the committee's priority number one.

A second challenge, according to him, will be "the absorption of what comes out of the Brexit saga".

Brexit has two major consequences on the budget.

First of all, the UK's contribution to the EU disappears from the budget. This will need to be compensated, mainly by net-contributors (countries that pay more than they receive.)

A second consequence is that the European Commission wants to abolish all rebates when the UK, the mother of all rebates, leaves the Union.

Germany calculated that its contribution will double, while the contribution of the Netherlands would go up by 75 percent.

That is the reason why five net contributors – Germany, the Netherlands, Austria, Denmark and Sweden – have asked not to increase the EU's budget and stick to the one percent.

A third challenge, Van Overtveldt said, will be "the question of the own resources of the EU and whether or not there will be more EU fiscal revenues or not."

The fact that the European economy – and certainly the German economy – is doing less well than predicted, will make the discussions on increasing the EU budget even tougher.

So, for Van Overtveldt, it is clear that he will be happy if his committee succeeds "in reaching an MFF in which the member states can find themselves, one that will strengthen the credibility of the EU and the social-economic fabric."

The coordinators are: José Manuel Fernandes (EPP, Portugal), Eider Gardiazabal (S&D, Spain), Valérie Hayer (Renew, France), Rasmus Andresen (Greens/EFA, Germany), Joachim Kuhs (ID, Germany), Bogdan Rzonca (ECR, Poland), Younous Omarjee (GUE/GNL, France).

This article first appeared in EUobserver's latest magazine, Who's Who in European Parliament Committees, which you can now read in full online.
Commission breaks taboo on 'own resources'

The European Commission has proposed a list of potential methods to enable the EU to raise its 'own resources' in future, citing the need to end current wrangling over member state contributions to the Brussels budget.

Magazine

Six priorities for human rights

Belgian socialist MEP Marie Arena is chairing the European Parliament's sub-committee on human rights. Her biggest challenge? Finding ways to reach objectives that cover an enormous spectrum of issues - from climate to child protection.

Magazine

EU must manage climate and industry together

For Romanian centre-right MEP Adina-Ioana Valean, the previous chair of environment committee and current chair of industry, research and energy (ITRE), climate and industrial policy-making must go hand-in-hand to bring sustainability and prosperity to Europe.

Magazine

ENVI to deliver 'Green Deal' as main priority

The French liberal MEP Pascal Canfin, who is chairing the European Parliament's committee on environment, public health, and food safety, is adamant to deliver the Green Deal quickly - because "we cannot afford to waste time".

News in Brief

  1. Citizens' perception of judicial independence drops
  2. Irish finance minister voted in as eurogroup president
  3. Italy's League party opens office near old communist HQ
  4. 'Significant divergences' remain in Brexit talks
  5. Germany identifies 32,000 right-wing extremists
  6. WHO to hold probe of global Covid-19 response
  7. China accuses Australia of 'gross interference' on Hong Kong
  8. EU to let Croatia, Bulgaria take first step to join euro

Magazine

Welcome to the EU engine room

Welcome to the EU engine room: the European Parliament (EP's) 22 committees, which churn out hundreds of new laws and non-binding reports each year and which keep an eye on other European institutions.

Magazine

Which parties and countries chair the EP committees?

Although the European Parliament tries to keep a geopolitical balance within the committees, the breakdown of the actual chairs of the committees by political party and nationality is uneven - with a clear under-representation of central and eastern EU countries.

Stakeholders' Highlights

  1. UNESDANext generation Europe should be green and circular
  2. Nordic Council of MinistersNEW REPORT: Eight in ten people are concerned about climate change
  3. UNESDAHow reducing sugar and calories in soft drinks makes the healthier choice the easy choice
  4. Nordic Council of MinistersGreen energy to power Nordic start after Covid-19
  5. European Sustainable Energy WeekThis year’s EU Sustainable Energy Week (EUSEW) will be held digitally!
  6. Nordic Council of MinistersNordic states are fighting to protect gender equality during corona crisis

Latest News

  1. Michel lays out compromise budget plan for summit
  2. Border pre-screening centres part of new EU migration pact
  3. EU 'failed to protect bees and pollinators', report finds
  4. MEPs give green light to road transport sector reform
  5. If EU wants rule of law in China, it must help 'dissident' lawyers
  6. Five ideas to reshape 'Conference on Future of Europe'
  7. EU boosts pledges to relocate minors from Greece
  8. Hydrogen strategy criticised for relying on fossil fuel gas

Join EUobserver

Support quality EU news

Join us