06 November 2014

European Voice: Deadline looms on EU’s budget for 2015

Instead of negotiating over the 2015 budget for spending, finance ministers and their officials have been scrambling to find a way to defuse a row over contributions to the EU’s budget, which erupted at the European Council on 22 October.

Finance ministers and MEPs have barely a week left to complete agreement on approving the European Union’s budget for 2015, but negotiations are hopelessly behind schedule because of disputes about making belated changes to the budget for 2014.

Finance ministers will meet November 7 to discuss scheduling payments for those member states that must contribute more to the budget – notably the UK, whose liability from 1 December could be as great as €3.6 billion – following a reassessment of their gross national incomes, from which the EU’s revenue is in part derived. The UK’s liability would be reduced to €2.1bn if the member states and the Parliament could agree on a Commission proposal as to how, as a change to the 2014 budget, the extra revenue should be distributed back to the national treasuries. Other changes being proposed to the budget for 2014 include an increase of €4.7bn in payments.

If agreement is not reached, then not only will the UK become liable on 1 December for interest payments on its unpaid contributions, but the negotiations on the 2015 budget will be blocked. The European Parliament has made agreement on changes to the 2014 a pre-requisite for talks on the 2015 budget.

The timetable set for the 2015 negotiations requires agreement between the Council of Ministers and the European Parliament by 15 November. If there is no such agreement, the Commission will be obliged to submit a new proposal. If there is no agreement on that proposal by 1 January, which in practice means the plenary session of Parliament in 15-18 December, the EU will move to operating on an ad hoc budget that is calculated as monthly instalments of the previous year’s budget.

© European Voice