Deal on €960m EU budget in the balance

Agreement on the EU’s seven-year €960bn budget is in the balance after an extraordinary summit in Brussels last night attended by the Taoiseach and Tánaiste.

With the timetable slipping for the Irish presidency to get agreement on the budget, the European Commission called the meeting, which, according to Eamon Gilmore, agreed to “unlock negotiations”.

Today, the European Parliament’s budget committee, which 12 days ago pulled out of talks with the Irish presidency, will discuss the outcome. Any real breakthrough is unlikely to happen until next week when Mr Gilmore, representing the member states, will sit down with the parliament’s negotiators.

The budget, known as the multi-annual framework, is the biggest and arguably the most important item the Irish presidency is expected to see through during its six-month stint at the helm of the EU that ends in July.

Without agreement, EU spending for 2014 would become complicated, with annual budgets based on spending this year, according to the parliament. However, according to the Irish presidency, there would be no legal basis for any budget and money would dry up.

This would affect funds including research, rural development, and spending on areas aimed at creating jobs and growth. It could also affect payments for agriculture, which account for about 70% of the EU funds that come to Ireland.

Enda Kenny, representing the EU countries; Mr Gilmore; parliament president Martin Schulz; commission president José Manuel Barroso; and the parliament’s chief negotiator Alain Lamassoure met to try to make some progress.

Mr Gilmore said afterwards that they had “agreed to unlock negotiations”, which suggests they reached political agreement to proceed with talks. A special meeting with the parliament is set for next Monday while finance ministers will talk about it next Tuesday.

However, the parliament accused Ireland and the member states of not having sufficient proposals on the table two weeks ago. “We didn’t want more state of play meetings — we needed a commitment to be prepared to compromise and make progress,” said a parliament source.

The process is comp-licated by the fact talks on this year’s budget have yet to be finalised. Being the end of the old budget term, the final bills for many projects are being submitted by countries now, leaving a shortfall of between €11bn and €16bn to pay EU commitments made to the states. Unspent money each year can be returned to member states and they also renegotiate the detail of each year’s budget annually.

The parliament is demanding that as well as starting the next six-year budget term in 2014 with a clean sheet and no unpaid bills, the seven-year budget is made more flexible so money unspent in one fund or for one year can be carried over or transferred to another fund.

It also wants the EU to be able to raise its own funds rather than having to depend so much on contributions from member states.


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