The Multiannual Financial Framework (MFF) 2021-2027 is one of the priority issues, which are currently negotiated in Brussels. However, two different approaches are increasingly emerging during this process: whilst many Member States would like a budget from 2021, which is a slim as possible, a significant majority of MEPs holds a completely different opinion.

 

Volume of the MFF

On 14 November 2018, the Interim Report of Parliament came to the plenary vote  resulted in a large majority of 429 MEPs being in favour of the Report. In it, Parliament comes to the right conclusion that - contrary to the Commission’s statements - the proposed 1.11 % of Gross National Income (GNI) does not represent a slight expansion of funding, but a reduction of the current MFF. Due to the fact that the European Union shall retain its current commitments and that new responsibilities have been planned in addition, above all in respect of Foreign/Security and Migration policy, Parliament intends to negotiate to increase funding both with Council and Commission. In concrete terms, Parliament demands a MFF of Euro 1,321 billion, which is equivalent to 1.3 % of GNI.

 

The Parliament lists no fewer than 23 topics, which - compared to the Commission’s proposal in May 2018 - shall be expanded: by contrast, the two largest spending blocks of the current budget, namely the Common Agricultural Policy as well as the Cohesion Policy, shall not be reduced. Apart from that, it is the intention to triple the funds for Erasmus+ and to double the resources for combating Youth unemployment in ESF+. Parliament also demands the additional allocation of resources of Euro 4.8 billion to a new fund for a fair energy turnaround as a reaction to social, socio-economic and environmental effects on workers and areas, which were negatively affected by the phasing out of coal. In addition, Euro 5.9 billion shall be made available to combat child poverty.

 

Rule of law

Parliament approves of the proposal of the Commission to cut Member States’ MFF funds if they do not fulfil the principle of the rule of law. However, it points out at the same time, that, if funds are cut where applicable, it must be ensured that citizens do not suffer if their government disregards the values of the EU.

 

Own resources

With regard to the revenue side of the MFF, Parliament retains its clear attitude in favour of strong resources of the EU. Hence, the declaration by Parliament that it wants to treat expenditure and revenue as an overall package in the course of the forthcoming negotiations and that it rules out agreement if the Council does not make any concessions with regard to expanding own resources, is particularly interesting. In doing so, Parliament wants to put pressure on the Council, as it does not require Parliament’s approval regarding the revenue side. In contrast to many Member States, Parliament welcomes the proposal of the Commission to expand the EU’s own resources, for example in form of direct funding from the emission trading system or a levy on single-use plastic.

 

Workers and consumers are those groups, who, due to their tax payments do significantly contribute to funding the MFF: consequently, the much quoted “European added value” must also reach them. From the point of view of the Chamber of Labour, the MFF ultimately serves the purpose to create a more social Europe. Therefore, a strong European Social Fund is of key importance. Hence, the AK demands an increase to 10 % of the EU budget. Due to the strong decline of farm enterprises, cuts to budget resources with regard to agricultural direct payments and a reallocation towards the funds of the European Agricultural Fund for Rural Development (EAFRD) and the expansion of social infrastructure, are appropriate.

 

 

Further information:

 AK Position Paper: EU Multiannual Financial Framework 2021-2027: A budget that unites Europe

AK EUROPA: EU needs a Multiannual Financial Framework that unites Europe

European Parliament: Interim report on the Multiannual Financial Framework 2021-2027

A&W Blog: The new EU Budget: a budget for the future?