Resisting EU budget cuts

EU Parliament BUDG DEVE committee meeting: “How can the EU deliver better aid? Unlocking innovation and optimizing European resources: innovative methods and strategic alliances to leverage European added value. (EU Parliament photographic library).

EU Parliament BUDG DEVE committee meeting: “How can the EU deliver better aid? Unlocking innovation and optimizing European resources: innovative methods and strategic alliances to leverage European added value. (EU Parliament photographic library).

The Irish Presidency, with its self-congratulating and artificially sweetened style, announced once more ‘a major breakthrough’ in the EU budget negotiations with the European Parliament, without the slightest reference to the other side’s position. This obvious neglect of basic reporting rules which goes as far as sidestepping of democratic principles, has become standard in Irish Presidency’s press releases, regarding the trilateral negotiations between the legislators, the Commission and the Council over the EU spending ceilings during the next seven years. It’s not the first time the Irish Presidency bullies the Parliament on this issue.

The budget at stake

At stake is the Multiannual Financial Framework 2014-2020 of EU spending. There is more to it however. The 2012 budgetary exercise of the European Union has left unpaid bills. The same is predicted to happen this year too. The Parliament estimates that the 2012-2013 deficits in those two EU budgets will be at €11.2 billion. The Commission has accepted to cover only the €7.5bn. This is bad news for many small and medium enterprises, public entities and local authorities all over the EU. They have undertaken to realise EU projects. They have spent their own money and even borrowed to finish those projects. Unfortunately the Union is now incapable of honouring its obligations and settle the accounts.

Now as for the main cause of disagreement between the Parliament on the one side and the Commission and the Council on the other, it’s the overall EU spending ceiling for the next seven years. This backstop has been set at €960bn, after an agreement in the February 2013 EU Summit of the 27 leaders. Of course this agreement has to be ratified by the Parliament. The approval of the Parliament is not only mandatory but constitutes the main statutory function of the EU’s legislative body. It goes without saying that the Parliament can overrule the agreement/proposal of the EU leaders.

Actually the Parliament has rejected this proposal on 13 February. All the four major political parties in a rare unanimity issued then a very strongly worded statement. The Parliamentarians want this new multiannual financial framework to be more flexible and open to revision. They also insist on a real system of own resources for the EU. On both accounts there is no sign of agreement. On top of that the President of the Parliament Martin Schulz said that he will never put his signature under this €960bn MFF 2014-2020 agreement of the EU leaders. He clarified that his denial is based on the fact that this budget limit leaves sizeable deficits which have to be covered with borrowed money. The EU Treaty however explicitly forbids borrowing to cover budgetary deficits. On top of it, the MFF 2014-2020 is the first one in the EU history to be lower than the previous one.

Irish stubbornness

Yet the Irish Presidency during the past few weeks has been insisting that an agreement with the Parliament is imminent, is near, is close, is around the corner, and all that. Of course all that exists only in the minds of the Irish government ministers, who conduct those negotiations. Understandably all Council Presidencies want to present good results in their six month term. The Irish though are overdoing it.
According to the latest Irish Presidency Press release, ” The Tánaiste (Deputy Irish Prime Minister) and Minister for Foreign Affairs and Trade, Eamon Gilmore TD and Minister of State for European Affairs, Lucinda Creighton TD led the Irish Presidency delegation, representing EU Member States, in the this evening’s talks with the European Parliament and European Commission. Speaking after tonight’s EU budget talks in Strasbourg, the Tánaiste Eamon Gilmore TD said: “We made very good progress tonight. I believe we are nearing a deal. The positive momentum we generated in previous meetings has been accelerated. The shape of the final deal is now in view, though some intensive negotiations remain.”

The above Press release was issued late yesterday night at 22:45 GMT. The pressing is obvious. Avoiding however to report the other side’s opinion reaches the limits of immodesty. Thank God the Irish accepts that “some intensive negotiations remain”. The Parliament hadn’t issued anything on this matter until the moment those lines were typed.

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