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Barroso and Lewandowski particularly point to an enhanced conditionality in the EU’s cohesion policy. According to the authors, EU funds should be increasingly dependent on structural reforms that promote growth. This should be achieved by means of partnership agreements.

Furthermore, they prospect that a lot more spending will be used to enhance innovation, research, education as well as infrastructure. In this respect, the MFF should be in accordance with the “Europe 2020″ strategy which aims at intelligent and sustainable growth.

The new guidelines will enable the EU budget to combine consolidation, investment incentives as well structural reforms.

The full article can be found here: Der EU-Haushalt und die Quadratur des Kreises

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An informal meeting of the ministers for agriculture and their negotiation about guidelines for the future CAP has been part of the news: EU-Haushalt 2014 bis 2020: Bangen um eine schnelle Einigung (TopAgrarOnline).

A general review about the CAP has been published on the web page utopia.de: Fakten zu Agrarsubventionen aus dem EU-Haushalt (Utopia.de)

The contribution of the member states to the budget has been discussed as well:

Wer füllt die europäischen Kassen? (Handelsblatt.de).

EU-Budget: Österreich will weniger zahlen (Kurier.at).

Streit um EU-Haushalt geht weiter – „Geld besser ausgeben“ (Nordbayern.de).

Finally, the rebate on the UK’s contributions to the budget also made headlines:

EU warned that talks on the UK rebate will be ‘pointless’ (BBC).

Furthermore, the European Parliament is calling for a reformation of the budget’s own resources system.

More details about the Parliament’s position can be found here.

The outcome of the vote was welcomed by Algirdas Semeta, Commissioner in charge of Taxation and Customs Union. According to him, the vote of the European Parliament is a recognition of the benefits, a FTT has to offer: a fairer tax system, greater stability of the financial sector as well as a new source of revenue without additional burdens for the everyday taxpayer. In a speech in the European Parliament he emphasized that an FTT “will help re-built the damaged relationship between the financial sector and the ordinary citizen.”

More about the Commission’s reaction and the speech by Commissioner Semeta can be found here.

Different proposals for a FTT have already been reviewed in a previous article on our page: FTT-The answer to all problems?

The first one was part of the paper “Der Weg aus der Krise – Wachstum und Beschäftigung in Europa” by the so-called “Troika” of the SPD (consisting of party chairman Sigmar Gabriel and vice-chairmen Frank-Walter Steinmeier and Peer Steinbrück). They call for a restructuring of the EU budget by reducing agricultural payments in favor of expanded spending for growth, employment, research and education. According to the “Troika” it is not acceptable to spend more than 40% of the EU budget for agricultural purposes while there is strong need for a future growth agenda. Therefore, they support a European growth pact that should contain programs against youth unemployment as well as a new regulation and taxation of financial markets.

At the same time Dr. Wilhelm Priesmeier and Thorsten Wehner, SPD spokesmen on agricultural policy, emphasized the importance of a strong CAP in the next EU budget. According to them, agriculture is the backbone of the rural areas and an enhancement of competitiveness of its production is essential.

In a reaction to these contradictory positions, Ilse Aigner (CSU), German minister of agriculture, criticized the SPD for their “disorientation”.

The paper of the “Troika” can be found here: “Der Weg aus der Krise- Wachstum und Beschäftigung für Europa”. It also contains other proposals for the EU budget (e.g. the role of the EIB and the EU’s several funds).

The position of SPD’s agricultural spokesmen is given here: SPD Agrarpolitiker betonen Bedeutung der Landwirtschaft für die ländlichen Räume.

More about the position paper can be found here.

Similarly, a comment by Stefan Kornelius raises the idea that a growth stimulus package could be realized by replacing EU’s subsidies on agriculture.

The comment can be found on süddeutsche.de.

First, the traditional role of the Franco-German cooperation in earlier negotiations on the multiannual financial framework. It seems obvious that reaching consensus on the MFF has become more difficult after last decade’s enlargement of the European Union. It is therefore worth looking at the agreement on the current financial framework which was achieved only after the Franco-German reconciliation of interests made by President Chirac and Chancellor Schröder at the Blaesheim meetings in March and June 2005. The French priority to codify the agricultural compromise of 2002 and the German demand for the integration of the new member states into the MFF clearly pre-structured the later outcome of the negotiations in the European Council.

Second, the victory of Francois Hollande in the French presidential elections will most likely lead to an adjustment of the French negotiating position. Under his predecessor, Sarkozy’s interests were mainly focussed on the fixation of the overall EU spending limit, the continuation of the level of direct payments from the European agricultural budget and the abolition of various rebates that exist for Britain and a number of other net contributors. Sarkozy gave no special attention to the European regional policy and that is what is likely to change with Hollande. Given that 21 of the 22 French regions have Socialist governments Hollande can hardly repulse their demands for higher funding from the EU regional funds. This could facilitate a rapprochement with the German position, which has strong interests in structural investments, especially because of the eastern German states.

And thirdly, the indispensability of the Franco-German compromise. In the context of an extremely complex negotiation situation it must not be overlooked that an agreement between the two countries is of utmost importance even for a compromise between the EU net payers. This will be quite difficult to achieve in the current negotiations, mainly because of the Nordic countries that are pushing for a reallocation of budget resources from the agricultural policy towards research, education and innovation. Moreover, France and Germany traditionally have the role to alleviate the centrifugal dynamics between the divergent “integration cultures” in the Mediterranean, Northern and Central-Eastern European regions which have certainly increased not only because of the Euro crisis.

To sum up, the need for a Franco-German compromise appears to be even larger in the current situation than in 2005, while the balance of interests seems to be much more difficult to achieve due to a smaller overlap of respective national preferences.

EU-Haushalt soll 2013 um sechs Prozent steigen (focus online)
Comission takes gamble, seeks 6,8% budget rise (euractiv.com)
Sparen? Nicht bei der EU-Komission (wallstreet online)
Barosso plan for EU budget rise sparks outrage (ft.com)

Germany:
Silberhorn: EU-Haushalt – Komission fehlt Augenmaß (presseportal.de)
ITER: “Weitere 650Mio. Euro für das Milliardengrab” (euractiv.de)

UK:
EU inflation-busting budget criticised (The independent)
The mark of the EU: £666 cost to every British family for being part of Europe (mail online)

Netherlands:
The Netherlands will not support EU budget increase plan: minister (DutchNews.nl)

The outlook can be found here. For deeper analysis and comparison to previous years, try the draft budget 2013 at a glance.

The Commissioner’s press conference is also online: http: //ec.europa.eu/commission_2010-2014/lewandowski/index_en.htm