EU budget summit ends without deal
24 November BBC
The Brussels summit has ended without agreement on the 27-strong
union's next seven year budget.A BBC correspondent says another meeting
will have to be called to sort out the difficulties but it is unclear
how differences will be resolved.
European Council chief Herman Van Rompuy said he was confident a deal
would be reached early next year.Hours of talks failed to bridge big
gaps between richer countries and those which rely most on EU
funding.The UK said current EU spending levels must be frozen.The EU's
divisions are very clear and have become even more stark at a time of
economic crisis, says the BBC's Chris Morris in Brussels.Mr Van Rompuy
had reshuffled the allocations in his original proposed budget during
the summit, but he kept in place a spending ceiling of 973bn euros
(£783bn; $1.2tn).
With the eurozone's dominant states, Germany and France, unable to
agree on the budget, UK Prime Minister David Cameron had warned against
"unaffordable spending".The failure to decide on a budget came just days
after the finance ministers of the 17 eurozone states failed to agree on
conditions for releasing a new tranche of bailout money to Greece,
raising questions about the union's decision-making process.
Mr Van Rompuy's budget had been unacceptable to a number of other
countries, not just Britain, Mr Cameron told reporters."Together, we had
a very clear message: 'We are not going to be tough on budgets at home
just to come here and sign up to big increases in European spending',"
he said.
"We haven't got the deal we wanted but we've stopped what would have
been an unacceptable deal," he added. "And in European terms I think
that goes down as progress."
German Chancellor Angela Merkel said she was sympathetic towards Mr
Cameron's view but no more than she was to all countries involved in the
discussion."The discussions, both the bilateral discussions and the
common discussion, have shown us that there is sufficient potential for
an agreement," she added.
French President Francois Hollande said the summit had made
"progress"."There were no threats, no ultimatums," he told reporters.
"Angela Merkel and I both agreed that it would be better to take some
time out because we want there to be an agreement."
Without naming the UK, he also said it was time the system of budget
rebates was reconsidered."It is a paradox, because some net contributors
[EU countries that pay in more than they get back] get some of the money
back even though they are in a situation where they are wealthy enough
for them not to get this money back," he said.Lithuanian President Dalia
Grybauskaite remarked that the atmosphere at the summit had been
"surprisingly good because the divergence in opinions was so large that
there was nothing to argue about".European Commission chief Jose Manuel
Barroso said the talks had failed owing to "important differences of
opinion especially in overall size of the budget".
The Commission, which drafts EU laws, had originally called for a
budget of 1.025tn euros.Its position was supported by the European
Parliament and many countries which are net beneficiaries, including
Poland, Hungary and Spain. While most EU members supported some increase
in the budget, several, mostly the big net contributors, argued it was
unacceptable at a time of austerity.Germany, the UK, France and Italy
are the biggest net contributors to the budget, which amounts to about
1% of the EU's overall GDP.Mr Van Rompuy's revised budget would have
softened the blow to the two main areas of spending: development in the
EU's poorer regions, and agriculture.
Instead, there would have been greater cuts to energy, transport,
broadband and the EU's foreign service.
His proposal, put to leaders on Thursday evening, would have made no
change to the level of administrative costs something the UK might have
found unacceptable.Speaking after the summit, Mr Van Rompuy said: "My
feeling is that we can go further... It has to be balanced and well
prepared, not in the mood of improvisation, because we are touching upon
jobs, we are touching upon sensitive issues.
"Failure to agree on the budget by the end of next year would mean
rolling over the 2013 budget into 2014 on a month by month basis,
putting some long-term projects at risk.Analysts say that could leave
the UK in a worse position, because the 2013 budget is bigger than the
preceding years of the 2007-2013 multi year budget.
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