"We cannot accept this deal" - MEPs unhappy as Council agrees €908B budget

(UPDATED: 9 FEB 2013 -13:29 CET)

At the end of a marathon European Council meeting on Friday, MEPs in the European Parliament are unhappy about the deal reached between member states on Europe's future budget, saying it does nothing to promote growth.

President Van Rompuy concluded the Council meeting saying that the final budget is balanced and growth-oriented. Compared to the previous Multiannual Financial Framework (MFF), he said, there is an overall increase of €34 billion (or nearly 40%) in the heading for Competitiveness for Growth and Jobs. There will also be a real, net increase, he said, for programmes like Erasmus and Horizon 2020 for innovation. Some €30 billion had been set aside for the “Connecting Europe” budget line, which focuses on developing transport, energy and ICT networks.

The Council was, however, putting the best possible spin on the impact for research and innovation – a spending area that, in the last few weeks, had attracted an unusually active lobbying campaign by universities and technology companies.

The final  figure agreed for Horizon 2020, the framework research and innovation programme to run from 2014 to 2020, was €70.96 billion, according to Michael Jennings, a spokesman for Máire Geoghegan-Quinn, EU Commissioner for Research, Innovation and Science. That compares to the Commission’s original €80 billion proposal for the seven-year period.

But the picture is more nuanced than that. Compared to the current seven-year plan, of €55 billion for comparable initiatives in Framework Programme 7, it could be called a net increase in funding – which, indeed, is exactly how the Council described it. But by yet another measure, annual budgets, it’s a very slight cut in funding. The spending in FP7 rose steeply in the course of the seven years – to nearly €11 billion in 2013; thus 2014 would start with slightly less than 2013.

The mixed picture was reflected in a Tweet from Jennings on Saturday morning, after the summit: “Could be better, but still big jump vs. FP7,”  referring to the current research and innovation programme, Framework Programme 7.

Parliament's independence

Now, however, the budget battle moves from the Council to the Parliament, where many members were vowing to block any budget cuts at all for research and innovation, which they see as important for economic growth. There is uncertainty, however, whether they will be able to muster enough votes – particularly once national governments start pressuring members to follow the party line and support the deal. Earlier this week, the European Parliament's leadership announced they intend to vote by secret ballot. A move that could possibly increase the chances of a revolt.

Thus, this could turn into a major test of the Parliament’s independence from national governments – and already, many prominent MEPs are casting the issue in those high-stakes terms.

Whatever the political outcome, however, there will be months more of uncertainty about the details of Horizon 2020 spending. Even if the Parliament doesn’t block the deal, the earliest the Council will come back to Horizon 2020 specifics will be late Spring – and it could be into the Autumn before all the dust settles. Inside the Commission, the expectation is that all the programmes comprising Horizon 2020 will share equally in the cut from the original proposal – and the internal planning has been operating for some months under that assumption.

‘We cannot accept this deal’

In a statement after the conclusion of the Council, leaders of the Parliament's four largest political groups emphasised that Parliament's ambition is to promote growth and investment in the EU, and that this agreement will not strengthen the competitiveness of the European economy but weaken it.

“The European Parliament cannot accept today's deal in the European Council as it is. We regret that Mr Van Rompuy did not talk and negotiate with us in the last months. The real negotiations will start now with the European Parliament,” said Joseph Daul on behalf of the EPP, Hannes Swoboda on behalf of the S&D, Guy Verhofstadton on behalf of ALDE, and Rebecca Harms and Daniel Cohn-Bendit on behalf of the Greens/EFA.