European & International News

European Council Agrees on New Budget

[Brussels, 15 February 2013] Last week the European Council agreed on the new EU budget for 2014-2020, set at €960bn which is 1% of EU Gross National Income (GNI), down from 1.12% as set in the 2007-2013 budget. The new budget is the first net reduction in the Union’s history.

Although the conclusions from the European Council meeting outline the new budget’s aim to “reflect the consolidation efforts being made by Member States to bring deficit and debt onto a more sustainable path,”, with spending “mobilised to support growth, employment, competitiveness and convergence, in line with the Europe 2020 Strategy”, it has been met with strong resistance from the leaders of the four largest political groups in the European Parliament. In a press release to coincide with the Council’s budget announcement, the leaders of the European Political Party (EPP), the Socialists and Democrats (S&D), the Alliance of Liberals and Democrats for Europe (ALDE), and the Greens/European Free Alliance (Greens/EFA) denounced the budgets potential to lead to a structural deficit at the European Union level. “Large gaps between payments and commitments will only store up trouble for the future and not solve existing problems… We must maintain support for future-oriented policies, strengthening European competitiveness and research.”

This sets the ground for difficult negotiations between European Council President Herman Van Rompuy and the European Parliament. MEPs have moved to have a secret ballot on the budget and therefore increase the chances of it being rejected. In a warning on rejecting the proposed budget Van Rompuy said, “One has to think twice before rejecting this European budget. Because for the people, for the enterprises, for employment, for youth, for youth employment, for prosperity, the stakes are really high.”

Read more about the budget announcement here.

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