The European Union’s member states and parliament reached an agreement on Wednesday on a new seven-year budget for the bloc after two days of last-ditch negotiations.
“Agreeing a budget is always very difficult. This one is particularly complex,” said Irish Foreign Minister Eamon Gilmore, who represented the 27 EU governments in the talks as his country holds the bloc’s rotating presidency. “It is a very good day for Europe.” Both sides “showed the required courage to make the tough compromises,” EU Budget Commissioner Janusz Lewandowski said.
They had been under pressure to deliver a deal by the end of the month to ensure that the funds for 2014-20 would start to be deployed on time.
The full parliament and the EU governments now have to officially endorse the deal, a step that usually is a formality.
But Wednesday night already saw the first grumblings from EU parliamentarians, with the Socialist lawmaker Ivailo Kalfin writing on Twitter that the deal was “not satisfactory.” The parliament had been at loggerheads with EU member states since February, when the governments agreed to cap the seven-year budget at 960 billion euros ($1.24 trillion) – leading to the first real-term cut to a multi-year budget.
The European Parliament swiftly rejected the deal, demanding a new round of negotiations as it exercised for the first time the power to sign off on the bloc’s expenditures.
The overall amount of the budget was not changed, but the legislature managed to secure a binding revision clause in 2016. This will allow the new parliament that will have been elected by then to try to adapt the budget if the economic times change.
The two sides also agreed on “carrying forward the discussion” about the EU directly raising resources – a key demand of the parliament, which wants the budget to be less dependent on national funding. A “timetable” is in place for those talks, Gilmore said.
Governments additionally gave some ground to the parliament on flexibility in the budget, but only from year to year, according to Gilmore. The parliament had sought the flexibility to transfer funds between line items in the budget.
In an acknowledgment of the growing unemployment problems in Europe, the two sides also agreed to provide “strong funding” in the first two years of the multi-year budget to deliver help more quickly, Lewandowski said. Europe’s solidarity fund will be “enhanced” too so that it is “more responsive to natural disasters.”