13 Mar 2013   |   News

MEPs register strong protest over EU budget

The European Parliament delivered a protest vote against the austerity budget agreed by national governments for 2014 – 2020. Now further negotiations – including on the €80B Horizon 2020 R&D programme – must be finessed by the Irish Presidency

By 506 to 161, Members of the European Parliament (MEPs) meeting in Strasbourg voted through a resolution calling for greater flexibility and efficiency within the EU budget, with several MEPs speaking out against the austerity budget proposed last month by EU leaders. The vote sets the stage for more budget negotiations between the Parliament and the European Council – a somewhat unpredictable process that could take weeks or even months.

“The Parliament wants to be taken as a serious partner. We want to come to a compromise and improve the MFF [Multiannual Financial Framework]," said Martin Schultz, President of the European Parliament, of the seven-year budget approved by the Council in February. The Council gave the nod to total spending of €908 billion, including €70.96 billion for Horizon 2020.

But that is more than €9 billion short of the Commission’s proposal of €80 billion for Horizon 2020, and a far cry from the ambitions of some MEPs, who had called for €100 billion to be invested in science, research and innovation - as a driver of economic growth. 

Research and innovation spending is a small fraction of the total budget. But having been billed as a source of economic stimulus and a job-creator by the European Commission, it drew some political attention during the debate on Wednesday (13 March).

Innovation, Infrastructure, Competitiveness

"We want a modern EU budget that is oriented towards growth and employment. We need sufficient spending in areas such as research, youth unemployment, infrastructure and climate change policies, to achieve the EU 2020 strategy…” said Göran Färm, vice-president of the socialist S&D group.

Guy Verhofstadt, leader of the Liberal ALDE group, concurred saying, “The European Council preserved the existing structure of the MFF, with only 13 per cent for research, innovation, infrastructure and competitiveness.“ In lieu of any explicit stance on the budget as it currently stands, holding out for a “modern budget” is perhaps the only source form of attack for those anxious about Horizon 2020, as the final negotiations get underway.

The Council’s proposal was a €70.96 billion budget for Horizon 2020, a cut from the €80 billion originally proposed by the Commission – but on paper at least, an increase from €55 billion allocated to  Framework Programme 7, running from 2007 – 2013.

But one of the main issues in the debate was not about future spending but the European Parliament’s role in the whole budget process as highlighted by the 2012 budget shortfall of €16 billion. Flexing the EP’s muscle, Schultz said, “Parliament will not even start negotiations until all unpaid payment claims for 2012 are covered.” This represents the gap between the pay-out commitments made by member states, of around €148 billion, and the actual funds disbursed of between €132 billion and €133billion. Last year, several important EU programmes, such as Erasmus, the Framework Programme 7 and the Social Fund ran out of funds early in the year.

The need for flexibility

In addition to being more growth-oriented, the Parliament made it clear that it wants to see increased flexibility between years and budgetary lines. This will entail carrying-over of under-utilised funds to other budget line and years, in effect allowing money to be re-directed to where it is most needed at any point in time.

MEPs also called for a review process, in which there would be a strategic analysis and reconsideration of how money should be spent, in response to changing circumstances. This will allow the new Parliament and new Commission that come into office in 2014 to put their stamp on how the EU budget is deployed.

Joseph Daul, MEP and chairman of the EPP group reiterated his support for flexibility by pointing out that the Parliament’s decisions, “lay the groundwork for our future”. Daul concluded the debate by saying, "The ball is now in the European Council's court if it, like us, wants to reach an agreement before the summer.”

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