The European Parliament (EP) yesterday set the ball rolling for an acrimonious battle over the next EU budget which is expected to dominate the bloc’s agenda for the next 18 months.
Disagreements are expected to erupt between the net contributors on one side, which include the large member states, and the net beneficiaries on the other, including Malta. Differences are also expected to divide the two main institutions that both need to agree on the budget: the EU Council, where member states are represented, and the Parliament.
The EP and member states are expected to start negotiations in the second half of the year following publication of the Commission’s official proposal next month.
Yesterday, MEPs on the Policy Challenges Committee said freezing the EU’s long-term budget after 2013 was “not an option”. They issued a demand for a five per cent increase in the EU’s finances for the budget period of 2014-20, drawing their battle lines for a major clash with national governments.
The centre-right European People’s Party (EPP) holds that five per cent is “the absolute minimum” needed to fund the policy priorities that EU leaders have already agreed to, such as boosting innovation, competitiveness and growth.
The call for a significant increase in funding was backed by MEPs from the three other main political groups in the Parliament: the centre-left Socialists and Democrats; the Liberals and the Greens.
This position puts the European Parliament on course for a collision with member states. Five of the biggest contributors to the EU’s finances are already insisting that any increase in the next financial framework should be limited to the rate of inflation, which this year is expected to be 3.2 per cent. During last December’s summit, the leaders of France, Germany, the Netherlands and Finland signed a letter to this effect written by UK’s Prime Minister .
Mr Cameron wrote that spending in the EU should be in line with the efforts national governments were making at home to make savings and cut public deficits.
However, many beneficiary member states criticised the move. Malta was one of those who refused to sign this letter, even though it was offered to Prime Minister Lawrence Gonzi who during summits sits next to Mr Cameron.
Dr Gonzi has said it is too early to commit on the structure of the budget.
The government fears a budget freeze could jeopardise the possibility of continuing to receive millions of euro in cohesion funds over the next budgetary period. During the 2007-2013 period, Malta was allocated more than a billion euro from the EU.