Fight continues over €4bn shortfall in 2013 budget

1,800 changes proposed to 2014 budget plan.

The European Parliament is drafting its version of the European Union’s budget for next year just as the fight over a €4 billion shortfall in the current annual budget is intensifying.

More than 1,800 changes to the European Commission’s proposal for the 2014 budget have been proposed by European Parliament committees. The Parliament’s budgets committee will consider these amendments line by line next week (2-3 October) and adopt a consolidated version the week after. A vote of the full Parliament has been scheduled during the 21-24 October plenary session in Strasbourg.

At the same plenary, MEPs are scheduled to approve the Union’s long-term budget for 2014-20, on which they struck a preliminary deal with the Council of Ministers and the European Commission in June. The vote on the multi-annual financial framework was initially supposed to take place at the September plenary, but was postponed by the Parliament’s leadership in protest at new cuts of just over €1bn that were introduced by the member states. This reduced the money available for payments in 2014 from the €135.87 billion proposed by the Commission to €134.81bn.

Bridging the gap

The gap between the two versions is bridgeable, officials suggest, and some weeks remain to achieve a final agreement – the deadline is 13 November. But MEPs are also angered by the Council’s cuts to ‘front-loaded’ funding for youth employment and innovation. And the real fight is over a €4 billion shortfall in the current annual budget. The Commission and MEPs are blaming member states for making insufficient appropriations in last year’s budget negotiations.

The college of European commissioners yesterday (25 September) renewed its request for an additional €3.9bn in member states’ contributions to the Union’s current annual budget. This is a second instalment of top-up funding requested earlier this year; a first instalment of €7.3bn was agreed in May.

Janusz Lewandowski, the European commissioner for the budget, is scheduled to brief member states’ diplomats and MEPs in separate sessions today (26 September) on the Commission’s request. The member states had split their additional contributions into two parts because they doubted the accuracy of the Commission’s projection.

Lewandowski has in the meantime put forward additional demands based on more up-to-date figures: an updated, lower forecast of ‘own resources’ – EU revenue from value-added tax and customs – means that the member states’ contribution based on their economic output will have to rise by €3bn to make up for shortfall in revenue.

Together with the earlier top-up requests, this amounts to some €3bn in extra funds that Germany will have to contribute and around €2bn for France.

Negotiators from the Parliament, the Council and the Commission are now exploring whether it would be possible to break the logjam with a package deal covering the extra funds for 2013, the annual budget for 2014 and the long-term budget.

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