MEPs Reject Budget Freeze

The European Parliament has refused Wednesday to a very large majority the European budget freeze in coming years claimed by Great Britain with the support of France and Germany, and requested a 5% increase for the period 2014-2020. 468 against 134 elected and 54 abstentions voted against the budget freeze in its level of 2013 for the period 2014-2020.

They also voted for the abolition of the British rebate and all types of discounts given to member states, notably Denmark enjoyed.

But they rejected an amendment calling for the abolition of one of two seats of Parliament – Strasbourg or Brussels – to save money. Part of elected officials campaigning to remove the one in Strasbourg.

The leaders of Britain, French, German, Dutch and Finnish had requested in December a freeze on the EU budget in 2013 to 2020. The British Prime Minister David Cameron and Mark Rutte Dutch go further and require the expenditure limitation to 0.8% of EU GDP, against 0.9% currently. European Commissioner for Budget, Januz Lewandowski, welcomed Parliament’s contribution, but predicted “difficult negotiations” with governments on the next multi-annual budget of the European Union, starting in 2014. These discussions should start this month with the submission of proposals by the Commission. “We’re talking about a total budget of 960 billion euros for the period 2014-2020 and 5% increase represents an envelope of 40 to 50 billion more,” is more than 7 billion per year to divide between contributions of 27, said Spanish conservative MEP Salvador Garriga Polledo, author of the report approved Wednesday.

The 2011 budget includes 126.5 billion in spending. The overall EU budget is fixed for seven years now. It is a spending limit capped at 1.23% of gross domestic product of 27 and which is the main mechanism of redistribution within the Union. The ceiling set by the States is currently far from being achieved. Recent budgets represent 0.9% of EU GDP, and according to Commission estimates, expenditures are expected to represent 1.06% of EU GDP in 2013, reached for all future calculations.

The requested increase of 5% recommended by the European Parliament would raise spending to 1.11% of EU GDP, far from the 1.23%, said a member of the EPP. “We do not want to freeze the EU budget, because in this case there will be no resources to finance the 2020 strategy” for the EU to boost its economic growth, “we offer a 5% increase financial perspective, “said Chairman of the Group of European People’s Party, the French MEP Joseph Daul.

Daul is a member of the UMP, the party’s right-wing President Nicolas Sarkozy, a proponent of spending freeze. All major political groups in favor of the increase. Only elected Conservative Eurosceptic group and reformer (RCT) have defended the budget freeze.