EU ministers consider budget spending
The European Commission was sparking a budget battle today by ignoring warnings from Britain and five other countries to tighten its belt.
The EU’s spending proposals to cope with enlargement to 25 member states were being unveiled amid warnings that Brussels must be as prudent as national exchequers.
Today EU finance ministers are in Brussels for talks as the commission ignores calls to cap spending.
The EU budget is paid for by the member states and, under the current agreement which runs out in 2006, the commission can lay claim to up to 1.24% of the national gross domestic product (GDP) of the EU countries.
In fact current spending levels are running at only 0.98% of GDP, and the UK, France and Germany, Austria, Sweden and the Netherlands want the new spending round to set the ceiling at 1%.
Commission president Romano Prodi has slammed that idea as illogical at a time when the EU is expanding and might need to use up the 1.24% ceiling.
He says the current EU budget is “extremely modest” compared with public spending of up to 50% of GDP in some of the member states.
The president of the European Parliament, Pat Cox, backed Mr Prodi, saying EU expansion to 25 countries was an investment in solidarity, and warning: “This is not the time to do Europe on the cheap, nor is it the time for short termism, retreat or hesitation.”
Running the EU costs about €100bn a year, using up 0.98% of national GDP.
But the new spending negotiations now beginning are designed for the period 2007 – 2013, during which Mr Prodi insists it will be necessary to use more and possibly all of the financial headroom up to 1.24%.
