SME Chamber

Commission to Launch Battle Over 2013 Budget

Discussion is already shaping up to become a proxy battle over the size of the EU's multi-year spending programme for 2014-20. The European Commission will next week publish its proposal for the European Union's budget in 2013, initiating a battle with the EU's largest member states, which want to see spending reduced.

Although it is the member states and the European Parliament that ultimately decide the level of the budget, the Commission's proposal will be the starting-point. Discussion of the 2013 budget is already shaping up to become a proxy battle over the size of the EU's multi-year spending programme for 2014-20. The European commissioners, who are supposed to approve the draft budget on Wednesday (25 April), will the same day receive an update about negotiations over the multiannual programme.

The Commission is expected to propose that the budget should be increased by at least 5% compared to the 2012 budget. That level of increase would be fiercely opposed by much of the Council of Ministers, with Germany, France, the UK and the Netherlands leading the calls for the budget to be limited to its 2012 level plus inflation, or even cut. But a majority in the European Parliament will be calling for a bigger increase than the Commission proposes.

Sidonia Jedrzejewska, a Polish centre-right MEP who drafted the Parliament's opinion on the 2011 budget, said: "This is going to be a very special annual budget because it is the last year of the current multiannual financial framework. But also, because of the austerity atmosphere, we saw a level of payments which was too low during the last two budget years, 2011 and 2012."

Janusz Lewandowski, the European commissioner for financial programming and budget, has already warned that a carry-over of €11 billion from 2012 of claims from member states for spending on EU projects threatens to leave the budget short of money in 2013 to meet its obligations.

Jedrzejewska said: "What we have created is a backlog. The move I would expect from the Commission's draft budget is to propose a correct level of payments, which would be a substantial increase on 2012. It has to be more than 5%."

Representatives of the commissioners are due to meet today (19 April) to hammer out revisions to the draft budget, which will address both the overall level of spending and the distribution of the budget between different policy areas.

Neelie Kroes, the European commissioner for the digital agenda, is engaged in an eleventh-hour struggle to preserve the budget for research in information and communication technology. The budget department has proposed to take money away from ICT research to meet a funding shortfall in the controversial ITER nuclear research project. The plan is to cut €240 million from research, and €150m of that would come specifically from ICT research. At a conference in Rome last week, Kroes said that the cuts would be "a big mistake". "Everyone in the industry should raise their voice to say never, ever," Kroes said.

Industry groups have taken up the cause. Digital Europe, an association of technology firms, has sent a letter to Barroso, saying the cuts would "cause a direct and significant reduction in European jobs in the near future".

A British official said that the UK government would be very unhappy to see ICT research taking a disproportionate hit to pay for the ITER overruns and that the cuts should be more widely spread.

German MEP Helga Trüpel, spokesperson for the Greens on the budget, said: "We should not be pouring any more money down the black hole that is the ITER nuclear fusion project."

After publication of the draft budget next week, the proposal will go to finance ministers for discussion on 15 May. It will then be discussed in working groups until the end of June, with the aim that member states and MEPs reach agreement in the autumn.

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