Sassoli calls for ‘imagination’ to overcome budget negotiations deadlock

From left to right, Emmanuel Macron, President of France; Angela Merkel, German Federal Chancellor; Charles Michel, President of the European Council; David Sassoli, President of the European Parliament, speak on Thursday before the start of the European Council.

European Parliament President David Sassoli asked EU leaders on Thursday (15 October) to increase their financial contributions to the EU budget and called for “imagination” to make progress on the stalled negotiations.

“We are going to need some creativity”, he told reporters after meeting with EU leaders at the start of the European Council.

The Parliament has requested €39 billion to reinforce 15 priorities in the multi-annual financial framework, the EU’s long term budget totalling €1,074 trillion for 2021-2027.

A total of 22 billion will be new contributions from member states, while €17 billion will come from using unspent money in other EU programmes.

EU leaders, however, rejected the Parliament’s demand, as they recalled that EU coffers will add an unprecedented €750 billion recovery fund to overcome the coronavirus pandemic, as agreed in July after a five-day summit.

“It is not about calling into question the July agreement, but taking a small step which would move us closer to final approval of the package,” Sassoli told EU leaders.

Budget battle heats up as negotiators hit stalemate 

The European Parliament and the Council failed to make any progress on Wednesday (14 October) on the budget negotiations and accused each other of presenting misleading figures of the additional funds requested for the EU’s long-term budget.

Sassoli was confident that, by using “imagination and technical instruments” a solution could be found to narrow the differences.

Some EU leaders, notably Spanish prime minister Pedro Sánchez, took the floor to say that “there is no possibility” of reopening the July agreement, an EU diplomat told EURACTIV.

Spain defended back then an ambitious EU long-term budget. But as one of the countries more affected by the pandemic, the government fears that by discussing new spending ceilings, the approval of the recovery fund would be further delayed. 

The additional funds for the EU’s long-term budget are not the only bone of contention in the negotiations. Parliament and Council also disagree over how strict the Rule of Law conditionality attached to the EU funds should be. 

In spite of the stalemate in the budgetary talks, Sassoli said that “we are not behind schedule” in the negotiations.

The German presidency of the EU Council wanted to finalise the negotiations by late October or early November. In that way, the €672 billion Recovery and Resilience Facility, the main pillar of the stimulus, could be in place on 1 January, as planned.

In that case, recovery funds would start being transferred to member states in late spring 2021, once all capitals authorise the massive borrowing needed to finance the recovery fund.

On her way into the summit on Thursday, European Commission President Ursula von der Leyen recalled that “time is of the essence”.

“We still need to go through the ratification process in the member states, and only then the Commission can start raising the money on the market, and the European economy badly needs now this investment,” she said.

Von der Leyen quickly left the summit, after learning that a staff member had tested positive for the coronavirus.

[Edited by Zoran Radosavljevic]

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