The Brief – The hidden story behind the EU’s new budget

The Brief is EURACTIV's evening newsletter.

Budgets are hardly inspiring stuff for the general public, but they also tell interesting stories about shifting priorities and power struggles, which are usually not made explicit. As EU leaders hold a special summit on EU finances, EURACTIV reveals the hidden story behind the EU budget.

During a briefing on the EU’s proposed budget for 2021-2027 at the European Commission earlier this week, veteran Brussels journalist Jean Quatremer asked the awkward question: what’s the narrative behind the new budget?

For years, EU spending has been geared towards big political projects, Quatremer remarked: the single market in the 1980s under Jacques Delors, preparations for the adoption of the euro in the 1990s, and the ‘big bang’ enlargement to Eastern EU countries at the start of the new century.

So what’s the political storyline behind the EU’s new budget, he asked?

The response, from a “senior EU official”, was this: Money will now be spent on the European Green Deal, with 25% of all EU funding allocated to climate-friendly policies, up from 20% in the current budget. And a new Just Transition Fund worth €7.5 billion is being created to address social issues caused by the transition to a green economy.

The other big new priority is the “geopolitical” Europe that French President Emmanuel Macron has been calling for. As a result, more spending is being allocated to defence and security, border controls and the creation of a new Commission directorate dealing with defence industries and space.

To be sure, many things won’t change. Existing priorities such as agriculture and regional policy will remain the two biggest pillars of the  EU budget, even though their funding is being gradually reduced. From around 40% in the current budget, agriculture takes the biggest hit, with funding slashed to around 30%.

As Britain leaves the European Union, the official line is this: the EU continues to finance traditional policies – mainly farming and cohesion – while funding new priorities in order to meet future challenges.

But the shift in EU finances also tells a different story. Just look at the new priority areas: clean energy, border controls, artificial intelligence, research & innovation, aerospace & defence.

All these are pet topics in Paris and Berlin but not in Warsaw or Budapest, whose leaders couldn’t care less about the environment and are happy buying US military equipment.

To be honest, the change in focus is not unwarranted. Poland and Hungary have benefitted hugely from the EU’s largesse in the past two decades, and have, to say the least, not shown much gratitude in return.

So in answer to Quatremer’s question, here’s my take on the EU’s new narrative:

After years spent bankrolling the EU’s eastern enlargement, the new budget marks a shift back to the “old Europe” dominated by France and Germany.

Brexit has shown that disenfranchised middle-class voters in Western countries will bite back when given the opportunity, so maybe it is indeed time to refocus the EU project on “old Europe”.

The Roundup

The budget summit is upon us. Follow all the latest developments on our LiveBlog.

Ahead of the summit, the European Parliament is mounting pressure on the member states to agree on an ambitious budget for the bloc, demanding a bigger say in decision-making in the aftermath of Brexit and threatening to reject the bloc’s key financial instrument.

The European Commission will present this autumn a strategy on an integrated EU payments market, to facilitate the use of national payment services across Europe and reduce the dependency from international card operators such as Visa or Mastercard.

The new EU food policy, the Farm to Fork Strategy (F2F), will feature legislative actions and have specific targets for the reduction of risk and use of pesticides, Health Commissioner Stella Kyriakides confirmed in front of the parliamentary committee on the Environment (ENVI) on Tuesday.

The European Green Deal “will definitely create tensions” inside the EU, and risks pushing “two or three countries” to leave the Union altogether, former Romanian President Traian Basescu warns in an interview.

With this year’s Salon International de l’Agriculture taking place in Paris soon, the image of the agricultural sector is at the heart of farmers’ concerns, as they are struggling to recruit and complaining about so-called agribashing – a trend of disparaging farmers and their work.

Check out all the latest news in our weekly wraps from the world of Digital, Global Europe, and Agriculture.

Look out for…

EU27 leaders continue debating the budget at a special summit.

Views are the author’s

[Edited by Benjamin Fox/Zoran Radosavljevic]

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