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Smaller EU Budget for 2014-2020 Passed by European Council

February 8, 2013

Representatives from all 27 member states of the European Union who have been ensconced in budget talks at a summit of the European Council in Brussels for the past two days (February 7-8), reached an agreement this afternoon. Negotiations for passing a budget for the EU for 2014-2020 took place all through the night, winding up at 4:00 this morning and recommencing a few hours later. The budget was handed to an anxiously awaiting press whose up-to-the-minute reporting was aided by tweets from those in the talks, including one from European Council President Herman Van Rompuy who tweeted “Deal done! #euco [European Council] has agreed on #MFF [Multiannual Financial Framework] for the rest of the decade. Worth waiting for.”

Not everyone is as excited about the outcome of the summit, however. Before official negotiations began, the European Parliament, who must agree to the budget before it can be passed, warned it would not support a plan that created an “austerity budget.” In a press release representing the four largest groups within the European Parliament, Joseph Daul affirmed, “The European Parliament cannot accept today’s deal in the European Council as it is. We regret that Mr. Van Rompuy did not talk and negotiate with us in the last months.”

Despite the real possibility of significant change to the budget, the conclusion to this week’s summit marks a victory for the representatives of several northern states who sought deep cuts in European spending. For many, it was seen as a “last chance” meeting before many heads of state must face elections in 2013. Among these leaders is British Prime Minister David Cameron, who has made EU spending an important condition in his recent pronouncements on the future of the UK in the EU. He characterized today’s agreement as a victory “the British public can be proud [of].” The UK is one of five countries whose contributions to the EU budget have traditionally made up half of all money given (along with Germany, France, the Netherlands, and Spain).

In his official remarks on the budget talks, Van Rompuy stated the budget was, at its foundation, “a budget for the future.” As it is to encompass the remainder of the decade, it must be focused on sustainable growth, he stated, highlighting the increase in funds allocated to investments in education, research, and job growth. He also pointed to the problem of youth unemployment as he spoke of the €6 billion put aside for a new youth employment initiative. The final number agreed upon in the talks was €960 billion as a commitment ceiling with €908 billion in payments from EU member states.

Though a consensus was reached within the European Council today, there promises to be contentious negotiations on the horizon as the proposal passes to the European Parliament for consideration.

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