MEPs clash with member states over 2011 budget

MEPs says national governments’ attempts to cut EU budget puts growth at risk.

Members of the European Parliament have accused national governments of seeking cuts to the European Union’s budget that would undermine attempts to spur economic growth.

Ambassadors from the member states have agreed a draft budget for 2011 of €126.58 billion, €3.6bn less than the draft budget presented by the European Commission in April. The reductions agreed by the ambassadors would affect most areas of EU spending, but the biggest cuts would be to programmes intended to boost growth and competitiveness. The Council of Ministers wants to cut the allocation for growth by almost €2bn and save €1.075bn on cohesion spending compared to the Commission’s proposal. A further €821 million would be cut from spending on support to farmers and the fisheries sector.

Sidonia Jedrzejewska, a Polish centre-right MEP who is preparing the Parliament’s position on the 2011 budget, told her colleagues on the budgets committee: “I take these cuts not only as a provocation but as an offence.” She pointed out that the budget lines concerned were supposed to pay for the Europe 2020 strategy, which aims to boost competitiveness and stimulate growth. Je¸drzejewska called plans to cut the budget for youth training programmes, which the Parliament has made a priority, “a slap in the face”.

The strength of the MEPs’ reaction to the Council’s position indicates that the negotiations on the 2011 budget, the first to be agreed under the new rules of the Lisbon treaty, will be extremely tough. Seven member states – Austria, the Czech Republic, Denmark, Finland, the Netherlands, Sweden and the UK – opposed the Council position last week, arguing that there should have been even deeper cuts to the Commission’s proposal.

The UK, Austria, Sweden, Denmark and the Czech Republic are calling for the 2011 budget to be frozen at this year’s level. Finland and the Netherlands want further cuts but say the 2011 budget should concentrate more on the priorities of the Europe 2020 programme, such as innovation and research, rather than structural funds.

The seven countries argue that it would be unfair to their taxpayers, who are facing austerity packages at home, if the EU budget remained untouched. “In these economic times everyone has to save. A budget increase is not the right signal at this time,” said an EU diplomat.

Click Here: New Zealand rugby store

A diplomat from one of the seven member states pointed out that the Council’s position would still mean that the EU’s budget would increase by 2.8% next year compared to 2010’s budget of €122.95bn. The Commission had proposed a budget of €130.14bn, an increase of 5.9%.

The Council is proposing to cut €162m from the €8.3bn allocated for administrative spending across all EU institutions. The Commission would be hit hardest, with €79.6m less next year than it had asked for. The budgets for the Council and the Parliament have been protected from cuts by an agreement that each institution refrains from interfering in the other’s budget. Je¸drzejewska said the lower amounts proposed by the Council would mean recruitment across the EU institutions would be put on hold next year. “More or less, it’s a freeze on administrative expenditure,” she said.

The Council version of the budget as agreed by the ambassadors is now the subject of consultation with the national parliaments, which have until 12 August to raise objections. Once formalised, the budget will be submitted to the Parliament for approval.