An austerity deal reached to increase the EU budget for 2012 by just two per cent should not significantly hit Malta.

Hours of negotiations with EU finance ministers over the weekend ended in a compromise deal, which will see next year’s budget grow by two per cent – merely covering inflation costs – instead of the expected four to five per cent.

In the light of the economic climate and the austerity measures being implemented across almost all member states, the European Parliament and the European Commission had to climb down from their proposals and accept a much lower increase.

EU Council sources told The Times Malta was not expected to suffer any significant cuts due to this deal.

“The main cuts have been made in programmes such as education and research where Malta does not receive a lot of funds. On the other hand, cohesion policy, which includes structural funds, should be kept almost at the same level as this year,” the sources said.

Latest available figures show Malta last year received €112 million from the EU’s coffers.