EU proposes to spend more post-Brexit budget, but triggers battles

By Chukwuemeka Obioma

The European Union has proposed a bigger new multi-year budget that will trigger battles among member states over how to fill the funding gap left by Britain’s exit next year.

During the 2021-27 period, the EU would trim the biggest single item, farm subsidies, by five percent and wants a new plastics tax. It would spend more on research and technology, foreign aid, euro zone stability, compensation for job losses from open trade and on joint defence and frontier guards, according to the international news agency, Reuters.

The EU also introduced a new mechanism to penalise countries — notably in the ex-communist east — where governments breach EU rules on ensuring judicial freedom and the rule of law. These could find some of their vital EU funding being withheld.

“With today’s proposal we have put forward a pragmatic plan for how to do more with less,” saidJean-Claude Juncker, European Commission presiden.

“A budget for a Europe that protects, empowers and defends,” declared the Commission, urging the remaining 27 member states to make up the shortfall of at least 10 billion euros (8.8 billion pounds) a year to be caused by Brexit after 2020.

That statement,analysts say, expresses a campaign from Brussels to persuade voters that the bloc remains relevant after a decade of crisis that has seen severe austerity in countries hit by the euro zone debt crisis and uproar over the arrival of more than a million irregular migrants across the Mediterranean in 2015 alone.

“A Europe that protects,” has also become a familiar demand from French President Emmanuel Macron, as he tries to work with German Chancellor Angela Merkel to tighten integration after the ever-sceptical British have left, while easing fears among voters that the EU means open borders and jobs exported abroad.

The German government reacted cautiously, but the priorities it outlined, reflected many of those from the EU executive — tougher border control, more EU defence cooperation, tech innovation and a stronger defence of democratic values in Europe.

It repeated its readiness, like France, to pick up a bigger bill if the budget strengthens the Union: “But that,” it added, “includes fair burden-sharing among all member states.”

The proposed budget of 1.28 trillion euros in inflation-adjusted future prices — or 1.14 trillion euros at 2018 prices — would be greater in real terms than the 1.09 trillion euros in the 2014-20 Multi-annual Financial Framework.

EU Budget Commissioner Guenther Oettinger, who called for states to show unprecedented speed and agree on the budget within a year, said it was inevitable that there will be disputes: “There will be cuts, which many countries will complain about, and there will be new spending, which the others will complain about,” he remarked.

Some of the richest contributors, including the Dutch and Swedes, have insisted they will pay no more to fill the Brexit gap, while poor, eastern states like Poland demand no cuts.

Experts say this could hit opposition from farm lobbies, notably in France, while the proposal to withhold cash from countries which fail to meet “EU values” in terms of independent courts will anger Poland and Hungary especially as their leaders are already at odds with Brussels over the “rule of law” issue.

“The rule of law is an essential precondition for sound financial management and effective EU funding,” the budget proposal reveals, noting that independent courts were needed to ensure fair tender procedures as well as combat fraud.