Brussels, 30/10/2012 (Agence Europe) - Sweden, Germany and the United Kingdom have been disappointed on reading the first compromise brought forward by the Cypriot Presidency of the Council of the EU on the 2014-2020 financial framework (see other article). They are calling for greater reductions (of up to €200 billion on the initial proposal, not the less than €50 billion in the Cypriot paper). At the other end of the scale, however, a Polish diplomat, whose country benefits most from Community funding, expressed the view that Cyprus had over-pruned the proposed budget.
Italy, which in 2013 will become the largest net contributor (net balance 0.38%), says this compromise is not acceptable as it stands. It is not calling for significant reductions in the maximum spending proposed by the European Commission, but rather for allocation criteria to be redefined, particularly with regard to agriculture and cohesion so that its net contribution to expenditure (around €5 billion, or 0.38% of its GDP) is made more acceptable both financially and politically. In agriculture, Italy is unhappy with the proportionate, rather than linear, phased reduction of direct aid to those regions which receive aid higher than the Community average, and also the way in which this reduction is calculated, based, as it is, on the sole criterion of agricultural area. Italy would like other criteria, such as agricultural efficiency, to be taken into account. Italy has still to calculate the impact on its regions of a reduction in spending on cohesion of some €18 billion across the EU. It would like to see changes to the way the EU is funded, with the introduction of new VAT-derived own resources or, possibly, use being made of some of the income generated by the financial transactions tax. Indeed, it is even considering demanding a rebate for itself if other delegations remain intransigent on bringing changes to the current rebate system.
In the European Parliament, voices, including those of Rainer Böge (EPP, Germany) and the Greens, have been raised in protest against a compromise which they deem does not go far enough (EUROPE will return to this). (FG/LC/transl.fl)