The Guardian, EU rich and poor split over budget increase
EU president Romano Prodi is having a tough time convincing some member states that the union needs a spending boost of $270bn to fund its enlargement. It seems the 'rich countries' resent financing the union whose 10 new members are the 'poor countries.' The Guardian article previews a long battle to come on this issue.
The necons don't need an alleged plot to thwart EU cohesion - member states are well on their way towards dividing themselves if the drama behind this debate isn't exaggerated. And with financial problems in their own countries, plus the debate over identities, I wonder how such an expanded patchwork of nations will come together under an EU umbrella.
It seems though that the 'rich nations' need to take financial responsibility if they also want to take the helm, which they've indicated through their trilateral meetings. That's the price.
EU rich and poor split over budget increase
Ian Black in Brussels
Wednesday February 11, 2004
Europe's richest nations last night reacted with fury to proposals that would increase Brussels' budget to €143bn, a 25% increase on current spending.
In the first round of what will be a bitter battle, Germany and the UK rounded on plans for the hike, presented by the European commission.
EC president Romano Prodi insisted the increase was vital to finance the union's historic enlargement. He said the money was needed to boost economic competitiveness, create jobs, tackle immigration and finance the union's historic enlargement.
But the chancellor Gordon Brown and finance ministers from other leading nations, including Germany and Sweden, said the EU's budget could not soar when individual countries were trying to tighten their belts.
The argument flared after Mr Prodi defended the proposed increase to €143bn by 2013, an increase of €20bn.
According to one calculation, total spending could reach a trillion euros by the end of the next seven-year budget period. "The gap between ambitious high-level political commitments and the failure to implement must not be allowed to widen further," Mr Prodi warned.
The EU executive insisted any smaller rise would mean cuts in key areas and that the higher ceiling is needed to finance the accession of 10 new and mostly poor countries in May as well as Romania and Bulgaria two years later.
The plan was welcomed by Pat Cox, the Irish president of the European parliament. "We cannot run an ambitious Europe of tomorrow on an empty fuel tank," he said
The commission ignored warnings from the "gang of six" net contributors - Germany, Britain, France, Austria, Sweden and the Netherlands -who are demanding that the budgets be capped to 1% of EU national income. Mr Prodi retorted in Strasbourg last night: "That puts numbers before the political project. It is like building a house by starting with the roof."
Yesterday's exchanges were the first shots in what promises to be a marathon struggle pitting rich against poor members, old against new and minimalists against integrationists
The showdown is not likely before next year - during the UK presidency of the EU.
Very interesting article.
We now have three issues related to EU budget:
- The richest countries say that it is unfair to ask for more money when most countries are tightening their belt;
- There is a kind of schizophrenic tendency(see Ira's entry) to want a bigger Europe while giving it less money;
- The political divisions have an impact in the sense in which, France and Germany want to use their financial clout to pressure others.
It's a tense and difficult situation, but one of the fascinating aspects of EU history is that it has been a long sequence of very tense moments that have not prevented its development. That does not mean, though, that it cannot seriously fail at some point.