12/11/2013
The multi-annual EU budget for 2014-2020 was supposed to have been finalised
in February but the deal was made conditional on settling the 2013 budget.
Then, the final agreement on the 2014 budget was dragged in, which has now
been agreed, with â¬135.5 billion on the table, the first tranche to be drawn from the current multiannual framework. Even then, it was opposed by Denmark, Great Britain, the Netherlands and Sweden.
The interesting thing about
this budget, though, is the unreality of it all. You do not have to be a Brussels insider to know that the settlement cannot hold. Kept down to meet the needs of domestic politicians such as David Cameron, it does not meet the EU's pressing financial commitments.
Thus, this is not so much a settlement as a crisis deferred. Only in April, Booker
was writing of the â¬217 billion in deferred payments, known as
reste à liquider (RAL), which haven't gone away. The Commission since has been
tinkering at the margins in an effort to make ends meet, but there is only so much that can be done before this emerges as a make-or-break drama.
As it stands, the
BBC goes along with the pretence that a spending reduction has been put in place. Thus we get UK Conservative leader in Europe, Richard Ashworth MEP, welcoming what he claims is an effective freeze of the EU budget, with the headline spend is still set to fall by six percent.
But from Green MEP Helga Truepel, we get to hear that this is "a bad deal that will continue the perpetual cycle of EU under-budgeting". She warns that: "⦠the outcome is not only devoid of ambition, it will also lead to a situation again next year where the EU is facing budget shortfalls compared with programmed spending".
So far, the Commission has been able to keep the lid on things by going back for additional sums in amendment budgets, but this can't last. By the end of this current multiannual period in 2020, the shortfall will have become so huge that there will no longer be a possibility of deferring it.
This alone says that the situation is unsustainable, pointing to the need for a new treaty to come into force before the end of 2020. The "colleagues" will have a new treaty by then because they must â not least because the EU must be able to generate a new income stream, independent of the grip of the Member States â most likely some form of specific EU tax.
In the meantime, this "placeholder" budget has to be approved by MEPs at the plenary session in Strasbourg next week, whence the budget issue will be put to bed for a short time. It is, however, set to erupt. We have not heard the last of this.
COMMENT THREAD
