EU long-term budget 2014-2020: Europe needs a budget that can live up to its ambitions for investment, growth and jobs

All Member States are engaged in an unprecedented effort to return to budgetary balance in their national budgets. 20 Member states out of 27 are undergoing a procedure of excessive deficit, with the obligation, for most of them, to come back to a deficit under 3% of their GDP by 2013, 2014 or 2015, for the countries under a specific aid programme.

Meanwhile, negotiations on the European budget for 2014-2020 are ongoing.

These negotiations are made very difficult for two reasons: the obligation for unanimity within the European Council; the fact that 85% of the European budget continues to be financed through contributions from the Member States. And since 94% of this budget either comes back to the Member States or is used by Member States to ease the burden on their national budget, each Head of State is only focused on minimising what its national budget contributes to the common budget, and to maximising what it gets from it. It is a competition between 27 national interests.

At the last European Council, Member States found common ground for an agreement on a reduced EU budget for the 2014-2020 period. 

The role of the European Parliament

The European Parliament will have to vote on the budget. Since the entry into force of the Lisbon Treaty, it has the power to approve or reject the agreement reached in the European Council, with an absolute majority of its members.

Our role is to bring the debate back into the European sphere. Our role is to make sure that understanding of national interests is not blind anymore, but enlightened.

The main challenges here are three-fold.

Democracy

First, the democratic control over decisions taken by the Heads of State and Government of the 27 Member States is at stake.

Voting the budget is at the basis of our democracies. For the European Parliament, it is about defending the rights of the citizens who elected it, to agree on the budget which will finance European policies over the next seven years.

On February 7 and 8, the Heads of State and Government of the 27 Member States decided to commit all Member States to the level, use and financing of the European budget, without having informed any of the 28 Parliaments of the numbers that would be put on the table in advance, and without organising any public debate.  What kind of democracy would accept this system of governance?

Economics

Secondly, the issue is economic: the Multiannual Financial Framework is the EU's 28th long-term budget which, alongside the Member States' annual budgets, injects 94 % of its credit into long-term investments and into solidarity towards those states and regions experiencing the most difficulties and which they really need. The European budget is an investment budget. It provides the critical mass necessary for Member States to invest. In some EU countries experiencing deep budgetary cuts, EU funds are the only way to continue investing, be it in road infrastructure, research in the field of nuclear fusion or sustainable energy.

Politics

Finally, the issue is political. The Multiannual Financial Framework is not just a budget, but rather a political act, an expression of Europe's ambitions, by which we commit to financing common policies and projects that are of mutual benefit. This is more, not less, relevant in times of hardship and economic crisis. Cutting the volume of funds allocated to common European policies for the next seven years is like giving up our goal to use the European budget to sustainably get out of the crisis through the promotion of growth and job creation. More generally, we would end up giving up the EU ambition of financing a budget that is up to meeting global challenges for the EU in many fields.

What is more, MEPs have, many times already, expressed their conditions for an EU budget.

For them, the EU budget for 2014-2020 must provide added value in terms of growth-boosting investment. It must also allow for flexibility, so that the EU can better react and channel funds to where they are most needed. Moreover, the Union budget should return to a genuine system of autonomous revenue (own resources) which would obviate the need for the current complex system of rebates and squabbling over the size of national contributions.

Finally, a revision clause for in two or three years' time, with a system of qualified majority voting, should be included in the agreement.

EU Heads of State and Government may have found a deal at the last European Council, but the result is disappointing. It seems that, from the crisis, national leaders have finally come to the conclusion that the solution is a Europe that is weaker and less built on solidarity.

Should it adopt this agreement, the European Union would be less rooted in solidarity, less powerful and, in the end, less European because it would be deeply divided by contradictory national interests.

Without any room for budgetary manoeuvre for the next seven years, the EU would be doomed to act through more and more regulation and sanctions rather than providing more incentives and support. Growth and employment would be the first victims.

I will therefore recommend to the Parliament that it questions both the European Council's results and their method.