The debate in Luxembourg on Tuesday 18 October on the mid-term review of the multiannual financial framework (MFF) of the EU for 2014-2020 confirmed that many member states oppose the idea of establishing a new reserve for managing crises in the EU. The General Affairs Council showed itself to be divided over financing modalities in key domains (security, migration, growth and jobs).
After the Council debate, the Slovak Presidency of the Council of the EU said it was going to unveil to ambassadors on COREPER in the very near future a compromise document on proposals to revise the MFF. The Slovak Presidency added that the Council had to be cautious with the budget and see how priorities are to be financed, including using redeployment of appropriations.
A group of countries keen on budget discipline. The European Commission has proposed releasing €6.4 billion in 2018 to 2020 to finance priorities (migration, security and growth) (see EUROPE 11629, 11628), (see EUROPE 11624). Net contributors to the EU budget (Germany, Austria, the Netherlands and the Scandinavian nations) along with the Czech Republic and Belgium (the latter talked about budget neutrality) said on Tuesday that the MFF caps decided in 2013 should be respected rather than raised. Spain also warned against a rise in expenditure and uncertainty. Budget Commissioner Kristalina Georgieva answered by reassuring them that they wer enot going to touch the MFF caps and were even going to leave a comfortable margin within the caps.
Several net contributors (Germany, the Scandinavian nations and the Netherlands) along with Belgium asked for the priorities to be financed by making greater redeployment of appropriations. Some countries, namely Germany, Austria, Denmark and Sweden, advised making savings and, if necessary, revising the priorities for financing.
Hands off traditional policies! Several net beneficiaries of the EU budget, such as Spain, Portugal, Poland, Romania and Hungary, said that the financing of the new priorities should not affect the policies that were the priority in 2013 – in other words, the common agricultural policy (mentioned by Spain, Ireland, Poland and Romania) and cohesion policy (Spain, Poland, Romania and Hungary).
Several counties supported increased expenditure in a number of domains (transport for Ireland, and Erasmus+, SMEs and Horizon 2020 for Italy).
No suspension of the Structural Funds. Portugal highlighted the importance of cohesion policy, saying it was unfair to suspend some of the Structural Funds as part of the proceedings for excess deficit. Spain also discussed the negative consequences of such a suspension.
Poland draws line in the sand. Poland pointed out that its red line is to ensure that special instruments are not included in the current MFF caps. Latvia and Hungary backed Poland’s approach.
A number of countries, such as Croatia, Romania and Slovenia, said late payment of bills must be avoided.
Tight timeline. Spain said it was important not to rush to finalise a compromise in December on the MFF, saying that this was rather a tight timeline, but Georgieva said it would be prudent to act quite swiftly.
New crisis reserve. Few countries backed the idea of setting up a new reserve for managing refugee-type crises within the EU. Only Italy, Latvia and Romania were open to creating such a crisis reserve, the other countries greatly criticising the idea. Georgieva said she was sure the EU needed a little reserve buffer for the years to come, with a healthy and very cautious management of payments. The reserve would not be used if it were not needed, she reassured the quite large number of countries that doubted the tool’s value-added.
Overall, the commissioner was quite positive about pursuit of the negotiations, saying there had been more agreements than disagreements around the table, at least compared with her initial expectations. (Original version in French by Lionel Changeur)