Democracy at Work – Watching the Debate on the EU Budget

We often hear thatBrusselsis imposing its will on Member States and ‘telling us what to do’. Well, let’s have a look at this in relation to an important discussion which is at the heart of EU decision-making this year.

Yes, we are talking about money; what else; but not the Eurozone crisis or even the financial crisis. What we are talking about is the EU budget.

QCEA has written about the way the EU budget is formulated in seven year Multiannual Financial Frameworks elsewhere. Just to recap: although the EU has annual budgets, they are set within these Multiannual Financial Frameworks which are not developed on a rolling basis but rather renegotiated every seven years. Generally the process takes 18 months or so, although on the last occasion this happened, it took nearly two years. And on that occasion, the only way in which the negotiations could be concluded was to agree a thorough review both of the EU budget and separately and specifically, the Common Agricultural Policy.

That review took place between 2007 and 2010 and culminated in a Communication from the European Commission in October 2011. This was the basis on which the European Commission then made proposals for the next Multiannual Financial Framework for 2014 to 2020.

So what happens when the Commission puts forward such a proposal? This is a legislative proposal. That means that the European Union needs to make legislation to implement the proposal in the form in which it is proposed or in an amended form. The process involves both the European Parliament and the Council of the European Union.

Here, we will talk about the Council of the European Union and its work on this issue.

The Council of the European Union is basically the Institution where Member States’ governments work together. It operates in different so-called ‘configurations’ which bring together the relevant Ministers of the Member States’ governments.

The Multiannual Financial Framework affects all aspects of the European Union and therefore all the different configurations of the Council will deal with different elements of it. However, and because of its overarching importance, the General Affairs Council, which brings together theMemberStates’ Foreign and/or Europe Ministers, takes overall responsibility for this process.

Their meetings, when they discuss legislative matters, are open to the public. Attending in person may not be practical for many citizens. Even as someone based inBrussels, not five minutes away from their meeting place, I have not personally attended any of these meetings. But there is another way of hearing first hand, from the horses’ mouths as it were, what they are saying. Their discussions are webstreamed.

The General Affairs Council has so far had two meetings which have dealt with the Commission Proposals.

The first, still under the Polish Presidency, took place on 15 November 2011. As you can see on the picture, the webcast  opens in an ordinary webcast window with the normal controls. The one you may not be familiar with is the bit that says ‘ori’ and has a little upward arrow. If you click on that arrow, you can then choose your language to get interpretation for the contributions made by the speakers who can speak in any of the official languages of the EU.

For each of the discussions, the Presidency prepares an introductory document which frames the discussion. For the discussion on 15 November 2011, the questions put by the Presidency were related to the cohesion policy, the ‘Connecting Europe Facility’, the Common Agricultural Policy and Common Fisheries Policy. A background document is also provided.

The second discussion took place on 27 January 2012. This one was chaired by the Danish Presidency which began on 1 January 2012. The background document to this debate sets out only two questions: what are the main priorities and what are Member States’ views on the overall amount proposed for the 7-year budget by the European Commission.

In his conclusions to the debate, the Danish Minister for European Affairs, Nicolai Wammen, indicated that the discussions would not be easy.

The first thing to note is that every single Member State stated that the discussions around this Multiannual Financial Framework has to be seen in the context of the current economic crisis; the words austerity, fiscal constraints, and reductions in spending were mentioned over and over again. Whilst this is understandable – the meeting did, after all, take place just days before a European Council meeting which was aimed at bringing the Eurozone crisis under control – it is also important to remember that the Framework being discussed will determine EU spending from 2014 to 2020 and that immediate constraints therefore need to be put in relation to that time frame. The other concern with this approach from Member States is that the austerity response to the financial crisis is not necessarily the best response and this view is gaining ground.

There are several conflicting and contradictory positions emerging amongst Member States – none of them really surprising – but which will make agreement in a context where ‘nothing is agreed until everything is agreed’ – a principle which was reiterated by several Ministers – even more difficult.

Several Member States, referring to a joint letter sent in December 2010 by a number of Member States including theUK,Germany andFrance, stated that they would require a significant cut in the proposed budget framework. Over and over, Member States said that this budget is at least € 100 billion too high.

On the other hand, other Member States were clearly indicating that they felt the budget proposal put forward by the European Commission was about right, well balanced, and had already taken an approach that reflected the constraints that would have to be imposed on public spending.

There was some discussion about whether the budget should be agreed on a ‘top-down’ basis (i.e. first we decide how much money there is and then we decide what we do with it, or how we divide up the pie) or on a ‘bottom-up’ basis (i.e. first we decide what we need to/want to do and then we decide how much money this requires). The Member States who feel the proposal is too high were all supporting the top-down approach.

The priorities set out by Member States are even more predictable. TheUKwon’t see its rebate cut;France(andSpainand several of the newer Member States) won’t see the Common Agricultural Policy reduced; newer Member States want adjustments in the Common Agricultural Policy which will end the higher direct payments available to farmers in the old Member States. All agree that the priority has to be growth and jobs but how quite how you get there is a disputed point.

Some Member States argued that agricultural subsidies would not create new jobs; other argued that the cohesion policy does (or does not, depending on where you are from) contributes significantly to growth and jobs.

It is a little surprising, maybe, that the emphasis on research which has been in much of the discussion during the budget review and which has been in public debate was not echoed in this debate; but it was mentioned and it may be that Ministers take this as read.

Reference to the green agenda, climate action and related issues was noticeable by its absence from the discussion.

But the underlying theme from the perspective of a citizen still has to be: everyone is defending ‘their’ corner – maybe with the notable exceptions of Belgium, Luxembourg, Spain and Bulgaria who had more of a European theme in their contributions – as if it is all about ‘how much do I get out’ rather than how do we achieve solidarity across the EU as a whole.

There will be many more debates in the coming months about this issue in the General Affairs Council and elsewhere in the Council Structures. It is a debate that is worth following, because in the end, it will be the Member States who will drive the decision on this.

The European Parliament has a role in the process, but it is not as powerful as the Council of the European Union. So the Council is where our attention should be focused. So I recommend that you watch these debates to see how decisions are really made inBrussels. And then you can hold your government to account for what they contribute to the decision-making or the decision-blocking.

About Martina Weitsch

Martina worked for Quaker Council for European Affairs as one of two Joint Representatives from 2002 to October 2012. Her main areas of work were the EU role in Palestine/Israel, EU peacebuilding, conflict prevention and crisis management, EU finances, democratic accountability and relations with the European Investment Bank.
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