While the size and content of the next Multiannual Financial Framework (MFF) are causing tensions among the EU27, particularly over the future of the Cohesion Policy (see EUROPE 13874/1), the “financing” strand is no more consensual. Whether it is the level of national contributions, the pace of repayment of the common debt arising from the recovery plan, or the creation of new own resources, the various avenues for giving the EU more leeway appeared to have reached an impasse on Tuesday 26 May, during a ‘General Affairs’ Council.
In a joint statement published on the eve of the ministers’ meeting, 16 countries from the eastern and southern EU, including Italy, Spain and Poland, suggested a possible postponement of part of the repayment of the EU27’s common borrowing, the cost of which is estimated at €168 billion over the whole of the next budgetary cycle.
“Any postponement of the repayment of payments linked to the Next Generation EU could, on our side, run into constitutional obstacles”, Germany’s permanent representative to the EU, Thomas Ossowski, replied to them during the public debate on the MFF.
“Germany and Netherlands take a very dim view of this idea, because they believe it would amount to going back on the agreement on the basis of which they originally agreed to this common debt, in 2020. Moreover, it is hard to see why the debt would be easier to repay in future: it would merely postpone the problem, and therefore set a very bad precedent”, said a European diplomat.
The group of 16 countries also pushed for the abolition of the reductions which Germany, Sweden, Austria, Denmark and the Netherlands had until now benefited from on their contributions to the EU budget. The end of these rebates is “indispensable”, because “there is no political or economic justification for their reintroduction”, they judged in their joint text, while the so-called “frugal” countries are reluctant to increase their national bills.
“Maintaining this correction applied to our GNI-based contribution” in the ‘negotiating box’ that Cyprus Presidency will soon be proposing “is essential for us”, Dutch Foreign Affairs Minister Tom Berendsen warned for his part.
The outlook seems equally blocked as regards possible new own resources intended to finance a greater MFF, without excessively increasing Member States’ national contributions.
Agreeing new own resources is “an essential condition” for France looking to the adoption of the next long-term budget, French minister Benjamin Haddad told the EU27 table.
On this subject, “all the avenues currently on the table are, to say the least, meeting resistance around the table from the countries for the time being”, lamented a European diplomat on Tuesday. “We are firmly opposed to new common borrowing and do not see the need for new own resources. There is no such thing as free money”, Swedish Minister for European Affairs Jessica Rosencrantz had pointed out earlier. (Original version in French by Clément Solal)