The Commission has adopted the amendments on the multi-annual financial framework for which the initial proposals were presented in June 2011. A year later, while approaching the draft budget by 2020, Commissioner for Budget Janusz Lewandowski drew the complaint of member states through the latest reviewed proposal reflecting the fiscal impact of Croatia’s accession to the EU (in June 2013); the original proposal included a total cost of EUR 1,025 Billion in commitments, (+4.8% than initially) – 1.05% of the EU gross national income – and EUR 972.2 Billion (1% of the EU GNI) in payments. “The amendment doesn’t change the essence of the initial proposal. Since our proposal, there have been and there are still political and economic developments and they have impact on the data concerning the next programming period”, said Lewandowski.
On 24 July 2012, the representatives of the EU member states rejected the budget proposal presented by EC and main contributors demanded “massive savings” in line with the general austerity context. Therefore, Germany, Great Britain, France, Finland, Sweden, the Netherlands and Austria asked USD 100 Billion cuts in the next seven years, while Germany and UK demanded a 1% threshold of the GDP for costs in this programming period.
“We can accept an increase in payments depending on the inflation, this is our limit and we will not change our mind”, said British Minister David Lidington who shared the same opinion with his German counterpart Michael Link who said that “the Commission’s proposals have to be limited”.
The position of these countries has been severely criticized by the group “Friends of Cohesion” (which includes 15 countries) which has been disappointed by the EC because the amount dedicated to the financing of the new members has been reduced by EUR 5 Billion.
France was another country with a position of its own and demanded the financing of the budget from other sources such as the financial transaction charge, but this concept could not be applied at EU level because of opponents such as Great Britain, the Netherlands and Ireland.
“The French Government is decided to fight for the financing of the budget using alternative sources so as to reduce national contribution as much as possible”, declared Bernard Cazeneuve, French Minister for European Affairs.
Another solution considered is creating an intense and reinforced co-operation which demands the participation of at least 9 EU member states. However, only 6 countries have expressed their intention to achieve this objective (Germany, France, Austria, Belgium, Portugal and Slovenia). Spain, Greece, Slovakia and Estonia have also said they were open to this possibi-
lity. “Our project includes 7 to 12 countries and we will need to reach a consensus”, said Cazeneuve.
The project relies on a EC proposal which included the introduction of a fee for financial transactions of 0.1% for shares and bonds and of 0.01% for other financial products. This charge could generate up to EUR 57 Billion in the EU. Also, other financing alternatives are also studied including a fee on CO2 emissions.
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