Brussels, 29/10/2010 (Agence Europe) - The EU budget for 2011 was a gate-crasher at the meeting of the European Council. Under the leadership of the United Kingdom, 11 countries (UK, France, Germany, Netherlands, Sweden, Czech Republic, Denmark, Austria, Finland, Slovenia and Estonia) wrote to the president of the Council on Friday 29 October stating that they would not agree to make any further concessions to the European Parliament in negotiations underway on next year's budget. In spending terms, they do not wish to go beyond the position expressed by Council in August this year.
As soon as he arrived in Brussels on Thursday, British Prime Minister David Cameron threatened to make his agreement to a change in the Lisbon Treaty - which would allow a mechanism to be set up to assist states in difficulty - subject to a limited rise in the European budget.
Cameron said the rise of nearly 6% in the 2011 budget, as requested by the EP and Commission, was “unacceptable”, especially at a time when difficult decisions are being taken at national level to control public spending.
The EU's 2010 budget provided for payment appropriations up to around €123 billion. The European Commission suggested a rise of 5.8% in payment appropriations for 2011, a rise that the European Parliament reviewed upward to 6.2%. EU member states, however, have for now only accepted a rise of 2.91% (position adopted in August).
Initially a supporter of freezing the budget, the British Conservative leader, who is himself undergoing pressure for having announced severe cuts in national public spending, has rallied another 11 countries to give their commitment not to exceed a rise of 2.91%. Their letter states it is clear they cannot accept any more than that.
The Council and the European Parliament have now entered difficult concertation to seek to reach an agreement on the 2011 budget. The EP is ready to accept a moderate rise in funding, but only on condition that the Council agree to discuss new sources of funding for the budget and review, in 2012, the current multiannual financial framework.
The question was the focus of a heated debate at the beginning of the European Council. Jerzy Buzek, European Parliament President, is reported to have accused David Cameron of being “anti-European”.
To this, Cameron replied that the cuts he himself has made in the budget of the British police do not make him “anti-police”. Chancellor Angela Merkel then took the issue up, saying that her own cuts in the German budget did not make her “anti-German”.
The eleven states signing the declaration form a blocking minority. “There are still another 20 days for conciliation”, Buzek said, seeking to calm things down. He asserted that David Cameron's proposals had not received a “clear majority”. Martin Schulz, the leader of the Socialist Group at the European Parliament, said with irony that “Cameron only has to renounce the British rebate - that would already mean a possible reduction in the European budget”. According to Schulz, the increases voted by MEPs are only a consequence of decisions taken by the states themselves, for example, the decision to create a new European diplomatic service - in the hope of having “more Europe for less money”.
In a separate declaration, the Belgian Presidency nonetheless states that the 11-country declaration will have no impact on the Council position, which represents 27 states in procedures underway with Parliament. Belgium promises to continue to do its utmost to reach an agreement in the next few days.
Under pressure from David Cameron, the final declaration of the summit contains the following wording: “It is essential that the European Union budget and the forthcoming multiannual financial framework reflect the consolidation efforts being made by member states to bring deficit and debt onto a more sustainable path”. The European Council, moreover, said it would “discuss at its next meeting how to ensure spending at the European level can make an appropriate contribution to this work”.
This trial of strength over the 2011 budget can but heighten difficulties in negotiations to open in 2011 regarding the next multiannual financial framework. Although Cameron has been able to count on support from Paris and Berlin on the 2011 budget, Germany and France refuse to support the drastic reduction that he is calling for in funds devoted to the common agricultural policy (CAP).
Polish Prime Minister Donald Tusk said it would be difficult to challenge the position expressed by the British prime minister whereby, in essence, the EU budget should take account of the budgetary consolidation effort being made by member states. He nonetheless warned that, during Poland's rotating presidency (second half of 2011), Poland would categorically ensure that the debate on the future EU financial framework delivers a result that is in line with European objectives. He feels this result should ensure that the effort to make budgetary savings does not mean cutting back key EU objectives such as cohesion or investment.
During a press conference, Angela Merkel said the 2.9% rise that she is defending is a “fair offer. One should not agree to more”. (L.C./A.By./H.B./transl.jl)