Open Europe Blog

MEPs on the “Policy Challenges Committee” have agreed on their proposals for the next multi-annual EU budget period, to run from 2014-2020. When it comes to EU budget negotiations, this is the big one – these talks will set the overall “envelope” for each annual budget within the period.

Crucially, every national government has a veto. With negotiations expected to last around 18 months, expect plenty of horse-trading among European capitals, in addition to the various demands of the European Commission and Parliament. The context, remember, is the UK, France, Germany and others’ call last year for “restraint” and the EU budget to rise no faster than inflation between 2014 and 2020.

So these looming negotiations are where reform-minded EU politicans and governments have the chance to dig in and get something done – hopefully achieving a far better and prudent deal for taxpayers in these times of austerity.

But, in what has happened too often now to come as a surprise, MEPs seem intent on pushing as many ‘hot buttons’ as they can. Their proposal includes:

– a 5% increase in funding. This doesn’t sound much like “restraint”.

– an end to all “rebates, exceptions and correction mechanisms”. Yes, that would mean the UK’s rebate, worth billions over a seven year period.

– a “system of real own resources”. Also known as a new direct EU tax.

no reform of the EU’s wasteful farm subsidy regime nor the practice of recycling “cohesion” money amongst some of the richest countries on the world (also known as the structural funds).

Good to see everyone’s starting on the same page then.

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