Parliament defies EU leaders with vote against long-term budget

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MEPs massively voted yesterday (13 March) “to reject in its current form” the EU's long-term budget for 2014-2020, agreed by EU leaders in February after 26 hours of marathon talks. EURACTIV France reports from Strasbourg.




The promoters of a hard line vis-à-vis member states on the EU budget earned a significant victory in the European Parliament yesterday.

A resolution rejecting the EU's budget plan "in its current form" was backed by the leaders of all political factions, except for the European Conservatives and Reformist group of UK Prime Minister David Cameron.

Adopted by 506 votes to 161 (with 23 abstentions), the resolution puts Parliament President Martin Schulz, a Socialist, in a strong position to obtain concessions from EU leaders who are meeting in Brussels today for a summit dedicated to growth and jobs.

The vote illustrates the Parliament's determination to obtain substantial changes to the budget agreement clinched by EU leaders in February after 26 hours of marathon talks.

While the resolution accepts the overall spending ceiling negotiated by the European Council, MEPs are pressing for more flexibility between budget headings and annual planning periods.

“It is a great day for European democracy,” Parliament President Martin Schulz exclaimed after the vote.

“The Parliament wants to be taken as a serious partner,” Shulz stated, saying the summit deal was just a “draft” that doesn’t reflect MEPs demands.

The Council deal regarding specific policy areas (common agricultural policy, regional policy, etc.) have no value in the eyes of MEPs, the resolution says, reminding that these will be subject to separate negotiations in which Parliament and member states are on an equal footing.

"Herman Van Rompuy [European Council President] has called on Parliament to take its responsibility. Today, the responsibility of Parliament is to quietly say 'no'," said French deputy Alain Lamassoure (European People's Party), the Chairman of the Parliament's Budget Committee.

The Parliament's right to veto the EU's budget under the Lisbon Treaty allows it to have full-fledged negotiations with the Council where member states sit, added Catherine Trautmann, a French Socialist MEP.

National egos

But obtaining such a result has not been easy. Until the eve of the vote, political infighting related to pressure from national governments have been highly visible.

>> Read: National egos tame Parliament’s ire over EU budget

The fiercest discussions took place within the European People's Party group (EPP), which brings together a plethoric range of conservative and centrist parties from a dozen countries. Their governments, most of which negotiated the February summit deal, applied direct pressure to pass a more conciliatory resolution.

Polish, Spanish and German MEPs from the EPP group have tabled amendments late on Monday (11 March), for the word “reject” to be deleted from the resolution but were defeated.

No deficit allowed

The resolution highlights the growing problem of payment shortfalls, which jeopardizes EU programmes. Last year, the Erasmus student exchange programme, the Research Framework Programme and the Social Fund all ran out of money early in the year and had to be topped up later on.

Parliament insists that the issue of unpaid bills from 2012 must be settled before concluding the budget negotiations, as agreed in last year's budget talks. Parliament also wants a political commitment from member states that all bills falling due in 2013 are paid in 2013, so as to avoid "rolling over" a deficit into the new budget period for 2014-2020. The EU cannot legally run a deficit.

Flexibility, mid-term review, own resources

The resolution gives Parliament negotiators a strong mandate to ensure that the 2014-2020 budget is flexible enough to allow available funds to be used optimally.

Parliament also calls for a mid-term review of budget spending, so as to give the newly-elected Parliament and Commission an opportunity to influence the budgets that they will inherit from today's legislators.

Furthermore, the resolution makes the case for providing self-generating tax revenue for the EU.

The ball is now in the camp of the Irish Presidency, which will propose a roadmap for negotiations. Those could start in April and could be concluded by the summer.

If all goes according to plan, the Parliament and Council will have voted some 65 regulations by co-decision in the autumn,  representing the legal base of the next EU budget. If there is no agreement by the start of 2014, the budget ceilings from 2013, adjusted for inflation, will apply.

In Parliament, the European Conservatives and Reformist group (ECR), which voted against the resolution, encouraged national governments to "stand firm behind the figures agreed last month and only negotiate on some of the fine detail."

"We can accept that there should be some budgetary flexibility and a mid-term review of spending but EU tax-raising powers would only see European taxpayers forced to pay for every pet project the EU dreams up. This would be a bad outcome for the European economy," said the Conservatives leader Martin Callanan MEP.

After 26 hours of talks, EU leaders struck a deal on 8 February on the EU's long-term budget, but set themselves on a collision course with the European Parliament, which was preparing to fight off the decision to cut spending.

The EU budget for 2014-2020 is smaller than its predecessor. It goes down to 1% from 1.12% of EU gross national income. It is the first net reduction to the EU budget in history.

>>Read: EU leaders agree budget cuts, MEPs brace for strife and The EU’s 2014-2020 budget in figures

  • April: Irish Presidency, to start negotiations with member states on budget "flexibility" and other Parliament demands (overall ceiling agreed by EU leaders remains unchanged)
  • By end June: Negotiations expected to wrap up
  • Autumn: Parliament and Council to adopt some 65 regulations by co-decision in several policy areas, ranging from the Common Agricultural Policy, regional policy, research and others
  • 2014: New budget starts applying. If there is no agreement the budget ceilings from 2013 will apply, with adjustment for inflation.

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