Council seeks $64.8B in EU budget cuts

European Commmission President Jose Manuel Barroso with Cyprus President Dimitris Christofias. Photo by: Cyprus Presidency of the Council of the European Union

Key EU institutions are divided over the latest multiannual budget proposed by the Cyprus-led Council of the European Union, which seeks “savings” across all budget accounts, including external assistance.

The proposal, which was released Oct. 30, calls for €50 billion ($64.8 billion) worth of savings across the six sections of the bloc’s 2014-2020 multiannual financial framework. It sets a €64 billion cap on the Global Europe account, which covers external action and development spending.

This so-called negotiating box is expected to serve as basis for further negotiations on the budget, including a scheduled meeting of key stakeholders in November.

Cyprus’ proposed cuts are lower than those pushed by countries like the United Kingdom, Sweden and Germany. Both the European Commission and the European Parliament, however, criticized the size and content of the proposal.

“This negotiating box is not supported by the Commission,” the European Commission said in a statement. “The Commission remains committed to its proposal, which strikes the right responsible balance in times of crisis, both in the overall amount and in the balance between policies.”

The parliament’s key negotiators for the 2014-2020 framework were more direct in their opposition of the Council’s proposal, which they described as a “very bad signal.”

“We strongly oppose this development as it will inevitably put in jeopardy the future of certain key policies and programmes. We feel this will hamper the role of the EU budget as an instrument to generate economic growth and jobs,” members of the parliament Reimer Boege and Ivailo Kalfin said.

The two further lamented that the Council has again failed to take into account the parliament’s position on the budget. The parliament said it will continue to study the Council’s negotiating box, but warned that “any decision that disregards the European Parliament’s position could result in a veto by the EP.”

The parliament and the Council share legislative duties in approving policies such as the multiannual EU budget.

EU budgetary negotiations are closely watched by the development community, whose members are pushing for a robust development budget. ONE Brussels, in particular, supports the Commission’s proposal, which provides $51 billion as funding for development programs. The group, however, estimates that this budget could see €10 billion in cuts.

Development ministers from a number of European countries are also behind calls to protect the aid budget from cuts. Danish Minister for Development Cooperation Christian Friis Bach, for instance, said such cuts would be “detrimental” to Europe and should be abandoned.

Read more:


Read more development aid news online, and subscribe to The Development Newswire to receive top international development headlines from the world’s leading donors, news sources and opinion leaders — emailed to you FREE every business day.

About the author

  • Ivy Mungcal

    As former senior staff writer, Ivy Mungcal contributed to several Devex publications. Her focus is on breaking news, and in particular on global aid reform and trends in the United States, Europe, the Caribbean, and the Americas. Before joining Devex in 2009, Ivy produced specialized content for U.S. and U.K.-based business websites.