Some of the EU’s richer countries were quick to call for much deeper cuts to the European Commission’s draft budget following the release on Thursday of a negotiating text which makes modest reductions.

The Cypriot presidency of the Council of the EU has shared the long-awaited, so-called ‘negotiating box’, dealing a blow to fiscally conservative countries, including Germany, the Netherlands and Sweden, with cuts totalling roughly €33 billion.

“For the Netherlands, this is a no-go box,” said Eelco Heinen, the Dutch minister of finance, in a statement. “It is unaffordable, unbalanced, and with the wrong focus. The overall volume remains far too high at a time when fiscal space is limited across Europe and difficult choices are unavoidable.”

The proposal foresees a 2% cut in comparison to the European Commission’s €1.76 trillion proposal for the 2028-2034 cycle – with the main reductions targeting the competitiveness and the external action pots, while largely staying clear of the mega-fund that includes agriculture and regional development.

Jessica Rosencrantz, the Swedish EU affairs minister, said she was “equally surprised and disappointed” by the proposal, which she expected “to be more in line with reality”.

“The ‘cuts’ are barely visible and entirely insufficient,” she said. “Sweden has been clear all along that the volume needs to come down, big time.”

Group take

The group of the so-called ‘frugals’, an informal group of richer countries (though some prefer the term ‘modernisers’), has consistently called for bigger cuts to the budget and a clear priority on the EU’s “new priorities” such as competitiveness, security and defence.

The box was “no basis for an agreement,” one EU diplomat told Euractiv, adding that it was cutting modernisation only.

The budget plan is a win for the much larger cohesion-friendly alliance, mainly countries from southern and eastern Europe, who receive more money from the budget than they pay in. The group also includes net-contributors Spain and Italy and has argued for higher spending on traditional policies, such as regional development and agriculture.

With another EU leaders’ summit starting next week, Cyprus’ time at the helm of the rotating presidency is soon coming to an end, with Ireland taking over in the second half of the year.

Simon Harris, Ireland’s finance minister, told reporters on Thursday that finding a compromise budget proposal will not be “without challenge” during his country’s upcoming EU presidency.

“It’s clear there’s many moving parts in relation to this,” Harris said ahead of a meeting of EU finance ministers in Luxembourg. “But Ireland is preparing to assume that ‘honest broker’ role now in twenty days’ time”.

Thomas Moller-Nielsen, Eddy Wax and Nicoletta Ionta contributed reporting

(jp)