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BackIt is about a week ago that the EU Financial Framework 2014-2020 negotiations in the European Council failed. EU Budget Commissioner Janusz Lewandowski has now outlined the current state of debate at a discussion event, and he did not mince his words with regard to Austria: from the point of view of the Commission a rebate on Austria’s contributions was by no means justified.
According to Lewandowski the proposed cut by Council President van Rompuy by € 80 billion means an actual reduction compared to the current EU Financial Framework by € 20 billion. The reduction of the real EU budget volume becomes even clearer if one compares the figures in proportion to the Gross National Income (GNI): in the current EU Budget Framework about 1.12 percent of GNI will be allocated to EU projects, however, according to the Rompuy proposal this will only amount to 1.01 percent of GNI from 2014. Concerning the myth, that the EU Budget was very large, Lewandowski pointed out that the national budgets had a volume that was fifty times as high the EU Budget. Apart from that, the volume of the EU Financial Framework between 2000 and 2010 had increased by 37 percent; however, the volume of the national budgets by 62 %.
The austerity policy in the Council would destroy the Commission targets for growth, competition and employment, criticised Lewandowski. The EU Budget Commissioner also pointed out that from his point of view the agricultural sector was not a priority.
On the revenue side Janusz Lewandowski let it be known that the Financial Transaction Tax was still on course as a source of income. Two thirds of the revenue should flow into the EU Budget. However, due to the fact that many Member States were against a Financial Transaction Tax, it should only boost the budgets of those 11 countries that decided in favour of the tax within the scope of the so-called “enhanced cooperation”.
According to Lewandowski the situation regarding the demands for rebates on EU membership contributions is the most difficult issue. Great Britain wanted to keep her rebate in full. Other countries such as Austria, Finland or Denmark also want their rebates to continue. However, he was in no doubt that in particular in respect of Austria, a rebate was no longer justified; this was also clearly demonstrated by the Commission’s calculations. If Austria would receive a rebate, other countries would follow suit and also demand similar preferential treatment.
Finally, Lewandowski pointed out that the EU Budget would be an important driving force for investments. In Hungary, for example, up to 92 percent of investments were financed by EU funds; in Poland the figure stood at 52 percent. Investments mean growth and growth was important to repay debts emphasised EU Budget Commissioner Lewandowski at the end of his speech.
We have to wait until next year to find out whether Lewandowski’s appeal to the Heads of State and Governments will be met with an open ear. Even though no new date has been set, a new round of negotiations in the European Council on the EU Financial Framework 2014-2020, will probably not take place before February.
The austerity policy in the Council would destroy the Commission targets for growth, competition and employment, criticised Lewandowski. The EU Budget Commissioner also pointed out that from his point of view the agricultural sector was not a priority.
On the revenue side Janusz Lewandowski let it be known that the Financial Transaction Tax was still on course as a source of income. Two thirds of the revenue should flow into the EU Budget. However, due to the fact that many Member States were against a Financial Transaction Tax, it should only boost the budgets of those 11 countries that decided in favour of the tax within the scope of the so-called “enhanced cooperation”.
According to Lewandowski the situation regarding the demands for rebates on EU membership contributions is the most difficult issue. Great Britain wanted to keep her rebate in full. Other countries such as Austria, Finland or Denmark also want their rebates to continue. However, he was in no doubt that in particular in respect of Austria, a rebate was no longer justified; this was also clearly demonstrated by the Commission’s calculations. If Austria would receive a rebate, other countries would follow suit and also demand similar preferential treatment.
Finally, Lewandowski pointed out that the EU Budget would be an important driving force for investments. In Hungary, for example, up to 92 percent of investments were financed by EU funds; in Poland the figure stood at 52 percent. Investments mean growth and growth was important to repay debts emphasised EU Budget Commissioner Lewandowski at the end of his speech.
We have to wait until next year to find out whether Lewandowski’s appeal to the Heads of State and Governments will be met with an open ear. Even though no new date has been set, a new round of negotiations in the European Council on the EU Financial Framework 2014-2020, will probably not take place before February.