Archive for: February 2013

Demands for Cut to EU Budget

Leaders of the EU met in the latest two day summit to discuss the next seven years of the EU budget and spendings.  The summit ended however with no settlement between the 27 members.

For the tax year starting April 2010-2011 the British Treasury paid in more than £8 billion to the EU budget.  It is one among 12 other states that pay in more to the EU budget than they get back in the form of funding.

The UK’s David Cameron said to reporters- ‘”When we were last here in November, the numbers were much too high: they need to come down, and if they don’t come down then there won’t be a deal.” He added, ‘“Frankly, the EU should not be immune from the sorts of pressures that we’ve had to reduce spending.”

If the EU doesn’t reach an agreement by 2013 the budget would have to be agreed upon next year, which would put long term projects in jeopardy.  Concern has been expressed that further delays would hinder the opportunity for economic recovery, and the fact that a settlement is taking a prolonged period of time isn’t sending a good message to the rest of the members. A Downing Street spokesperson said it was “in our interest to do a deal” and insisted Mr Cameron was trying to reach agreement. Before formal talks began, Mr Cameron met European council president Herman.  Mr Cameron also had some conversations with other heads of government that are in the same position as he is, this includes: Angela Merkel (Germany), Fredrik Reinfeldt (Sweden), and Mark Rutte (Denmark).

In order to duplicate the cuts being made by national governments across Europe, the UK, Germany and other northern European nations want to lower the EU spending increases. France and Italy target investing as an important part of the EU, as investing is likely to create more jobs, and is better for the future.

With having the proposal for a real terms freeze rejected by MPs in October last year, David Cameron combated pressure to convey a real terms cut in EU spending.  The opposition were joined by many of Cameron’s Tories in defeating this – dealing a blow to Cameron’s policy on Europe.