Deal on the EU budget made by some countries, not by Europe!

EU leaders met in Brussels on February 7-8 to find an agreement on the next Multiannual Financial Framework. Finally a deal was made but one wonders for whom.

The EU budget 2014-2020 agreed last week (see Council conclusions) is smaller than the one for the period 2007-2013: in the Union’s history this is the first time that such a net reduction has been made. The budget amounts to about 960 billion € for 28 member states (including Croatia), which represents 1% of EU Gross National Income (in the current period it was 1,12%).

During the negotiations among member states, the lowest-common denominator approach prevailed. The decision on the EU budget is a clear and tangible sign that national interests are more important than the objectives of the EU. Europe is still agonizing over the economic crisis, a sharp divide between the North and the South of Europe and between the new member states and the old ones is increasing, the economic and social situation is deteriorating more or less everywhere in Europe. The EU budget should have served to contribute to face the current and future challenges: growing inequality, persisting poverty within Europe and beyond, the highest levels of unemployment, food insecurity, resource constraints, unsustainable growth, global competition, aging of the population, technological change and the transition towards a low-carbon economy.

As a response, EU leaders have chosen to cut the EU budget as a form of saving, in line with fiscal consolidation and austerity policies adopted by the majority of member states.

But what are the main victims of the cuts?

  • the heading “Competitiveness for growth and jobs”: research, innovation, transports and infrastructure, energy
  • development aid and policy
  • the heading “security and citizenship”
  • the heading “Administration”.

With these cuts, is Europe going to meet its ambitions in the global arena?

In this sad scenario, at least cohesion policy has had a slight increase (325 billion €) compared with the November proposal (320 billion €): however a cut of 11 billion € has been made to the Commission’s proposal (336 billion€).

A Youth Employment Initiative receives 6 billon €, half from the European Social Fund, and half from a dedicated Youth Employment Budget.

Before the Summit ended, the leaders of the four largest political groups in the European Parliament stated in a press release that “the European Parliament cannot accept today’s deal in the European Council as it is”. However, it remains unclear if MEPs will chose to veto the budget as agreed by EU Leaders by secret vote, which lowers the chance that it could be passed (source: Euractiv).