EU summit to hammer out austerity budget and tough cuts
7 Feb, 2013 09:29
EU leaders are to make another attempt to agree on a harshly reduced budget at the summit in Brussels. However, the EU parliament says it is ready to reject a deal that cuts spending on employment and growth.
The two day meeting in Brussels starting on Thursday is expected to be heated, as some member states consider the EU budget to be too high at a time of austerity. It remains a major division as last November the 27 states failed to reach a compromise at a similar summit.The budget for the years 2014-2020 totals about €1 trillion ($1.35 trillion), and while the UK and several other wealthy northern member states are calling for bigger cuts, poorer eastern and southern countries want to ensure continued EU financial support.On Tuesday UK Prime Minister’s spokesman said that David Cameron will not accept a deal on the EU budget in Brussels unless it freezes or cuts European spending.The Czech Republic is also set to veto the EU’s budget proposal, Prime Minister Petr Necas said upon his arrival for the summit, the Czeck media reports Thursday."I'm coming to Brussels for talks on the multi-year financial framework with a strong and unequivocal mandate from the Czech government. We find this proposal unacceptable, and we are ready to use a veto," Necas said, as reported by the CTK news agency.The EU Commission had originally wanted a budget ceiling of €1.025 trillion ($1.4 trillion) for 2014-2020, a 5% increase. In November that was revised down to €973 billion at the expense of administrative costs, and later further to €943 billion. But according to a EU spokesman, more severe cuts would leave the Commission unable to do its job, just as it is being called on to do more and more as the EU integrates more deeply in response to the financial crisis.On Wednesday the European Council President Herman Van Rompuy, who chairs the summit in Brussels, said that "for the first time ever – there will be a real terms cut compared to the current budget."However, parliamentary leaders, meeting in Strasbourg on Wednesday, emphasized they would reject any plan that undermines the role of the EU.The European budget comprises barely 1% of the combined GDP and the idea that taxpayers money is swallowed up by an all-consuming Brussels bureaucracy is a myth, argued presidents of the four largest groups in the European Parliament in an open letter published on the Huffington Post on Monday. “We should first and foremost define what is necessary to be done in the interest of all our citizens, instead of constantly advocating deeper cuts to please a largely populist domestic press. 94% of the financial contributions the member states transfer to 'Brussels' is returned through the various common policies or spent for development aid, and administrative costs make up only 6%,” say Joseph Daul of the European People's Party, Hannes Swoboda of the Progressive Alliance of Socialists and Democrats, Guy Verhofstadt, president of the Alliance of Liberals and Democrats and Rebecca Harms and Daniel Cohn-Bendit of the Greens/EFA.According to a senior EU official, though Van Rompuy is proposing an overall cut, some items within his proposed budget will grow, including an effort to combat youth unemployment. Speaking to AP on condition of anonymity he added that spending on programs meant to ensure future prosperity, such as research and development, education and innovation, will also grow in real terms.Robert Oulds, chair of the Bruges Group think tank, shared his view on the issue with RT.