MEPs vote against EU budget plans

Euro-MPs this afternoon challenged EU leaders to drop their austerity budget plans for Europe and boost spending for the next seven years.

Euro-MPs this afternoon challenged EU leaders to drop their austerity budget plans for Europe and boost spending for the next seven years.

They threw down the gauntlet in a 506-161 vote rejecting a summit deal last month which amounted to the first-ever real-terms cut in the EU’s long-term spending plans.

At the time, British Prime Minister David Cameron heralded a major breakthrough in overcoming EU Commission and European Parliament demands for more spending, and applying national-style austerity measures to the 2014-2020 EU spending programme.

The British PM said austerity-hit citizens would expect nothing less than belt-tightening in Brussels.

But now a majority of MEPs have demanded more, triggering a round of negotiations between national governments. the Commission and the European Parliament.

Leader of the European Conservatives Martin Callanan accused a majority of MEPs of “flying in the face of public opinion” by dismissing calls for belt-tightening and even pressing for new EU tax-raising powers to fund spending.

“The European Parliament is engaging in the worst kind of posturing, which makes it look completely out of touch with reality,” he said.

“The EU budget deal was a reasonable compromise between many competing demands”.

Mr Callanan said EU leaders should now “stand firm” behind the budget figures agreed last month:

“We can accept that there should be some budgetary flexibility and a mid-term review of spending but EU tax-raising powers would only see European taxpayers forced to pay for every pet project the EU dreams up. This would be a bad outcome for the European economy.”

But Socialist leader in the European Parliament Hannes Swoboda vowed that MEPs would fight for an “improved” budget.

He said: “We are ready for serious negotiations and we hope that governments will be as serious and responsible as the European Parliament. We should work together for a result which is more responsive to the needs of the citizens and to global competition.”

The attempt to peg spending at a real-terms freeze was “simply not acceptable”.

European Parliament president Martin Schulz defiantly said MEPs would judge the budget in a secret ballot – to stop governments pressuring their elected euro-politicians to toe the party line.

Today Mr Schulz lost that battle – but the stage is set for clashes in the forthcoming final bout of negotiations on actual spending levels.

Some government officials suggested some “flexibility” in year-on-year spending programmes might be acceptable, coupled with a “mid-term review”, but made clear a complete rethink to boost spending would not be on the cards.

Today’s rejection of the deal was even seen by many MEPs as a gesture, with many preparing for a final deal broadly keeping the spending ceilings set by EU leaders.

This afternoon EU budget commissioner Janusz Lewandowski said there should now be some urgency in finalising a deal: “We owe this to 500 million Europeans, to our businesses, towns and regions, scientists, students, NGOs and all those who benefit from EU funds: to reach an overall agreement as well as to complete the work on each sectoral policy in order to be fully ready by 1 January 2014.”

Mr Schulz remained defiant this afternoon, insisting: ``This important resolution (rejecting the austerity budget) paves the way for possible negotiations with the council (EU governments) on the long-term EU budget 2014-20. The European Parliament cannot accept the proposal from the member states without the fulfilment of certain essential conditions. There must be maximum overall flexibility and an ambitious agreement on own resources (raising direct taxes to finance the EU budget).''

The Parliament president made clear that MEPs were likely to demand up to €16bn extra to finance outstanding financial commitments for 2013 as part of a longer-term budget accord.

“Parliament will not even start negotiations until all unpaid payment claims for 2012 are covered,” he said. “These issues are of fundamental importance for the Parliament. The European Parliament will not accept the proposal from the member states unless there is movement on all of these issues.”

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