Tough talks on next year’s EU budget collapsed yesterday when the European Parliament refused to sit at the negotiating table with governments refusing to pay this year’s bills.
At the centre of the row was €9 billion worth of unpaid 2012 bills covering a range of worthwhile causes – Europe Erasmus student exchange programme, research funds, humanitarian aid and cash for rural development.
The dispute between have and have-not states also bodes badly for the fate of a key summit days away on the bloc’s even more hotly contested longer term budget for 2014-2020.
“If they can’t agree to pay the bills, what can they agree to?” said lawmaker Hannes Swoboda, who heads the parliament’s socialist group.
The one exception was an agreement to dish out €670 million set aside to compensate Italian earthquake victims.
In a statement issued three hours before EU budget ministers were to go into talks on the 2013 budget, the parliament refused to attend on grounds that EU nations were depriving Europe’s needy of key funds and failing to honour commitments.
“These funds are needed for the EU to respect its legal obligations, that is to pay for bills incurred for goods, works and services delivered,” said the parliament’s president Martin Schulz.
The EU executive, the European Commission, will now have to draw up a new 2013 budget proposal and seek an agreement on it by the year’s end.
Yesterday’s quarrel sets the scene for next week’s November 22-23 summit, likely to turn into an ugly showdown presenting a bitterly divided Europe, torn between older wealthier states and poorer members on its southern and eastern fringe.
Yesterday, battle-lines took shape as Britain’s premier David Cameron, self-styled leader of the toughest-talking cost-cutters in the EU camp, flew to the Netherlands and Italy to rustle up support from leaders Mark Rutte and Mario Monti before the summit.
In Brussels meanwhile, 15 heads of state and government from the opposite camp flew in to set a pre-summit agenda of what is termed the ‘Friends of Cohesion’ group. The EU’s Cohesion funds, the second biggest item on the bloc’s budget after the Common Agricultural Policy, aim to help Europe’s poorer nations catch up with others.
Members of the Friends of Cohesion are net recipients of the EU’s near trillion-euro budget. Chaired by Poland and Portugal, the group includes Bulgaria, Czech Republic, Estonia, Greece, Hungary, Latvia, Lithuania, Malta, Romania, Slovakia, Slovenia – and most recently, Spain.