The Result of the Brussels Budget Talks

 

I have excellent news for you! The Continent is isolated! Well, that is if you scan the broadsheets this morning. Who’d have thought that, after Brexit but while we’re still ‘In’, reporting on the EU Budget Summit is less important for them than talking about the US Presidential elections and “bullying in the Home Office”.

Oh – there are some ‘Brexit news’, one being that the blue passports will indeed return now (here and here). The other, about a possible new outbreak of the tree disease ‘Ash Dieback’, thanks to an ‘idiotic’ (sez Owen Paterson) new EU regulation which came into force in December 2019, is far more worrying. Our civil servants will of course implement that one … read all about it here.

The important news on the failed EU Budget Summit deserved just a terse report on the BBC website (here) and a more extensive article in the DM (here) while Joe Barnes of The Express reports the particulars, under the headline that “EU Leaders call it quits after 28 hours of talks” (link).

It’s important to look in some detail at why those talks failed because they will influence the forthcoming Barnier negotiations. There’s no way that the bad blood this failure has created isn’t going to affect both the Barnier Mandate and the ensuing negotiations.

For light relief we read that Mr Varadkar, the EU poodle, has turned round to bite his EU master’s hand. He is Ireland’s caretaker PM because the winners of the recent election have yet to agree on how they want to govern, in what sort of coalition. There are two reports (here and here).

Yeah, well – when Mr Varadkar was riding high on the wave of the EU’s Anti-Brexit stance, we did say that he should be careful because the EU would not ‘reward’ him. So there he now is, hung out to dry. Meanwhile, here are the numbers which caused all that bad blood:

“European Council chief Charles Michel [a former Belgian PM] has tabled a draft budget of €1.09trillion, which represents 1.074 per cent of gross national income of EU27 countries. The current long-term budget for 2014-2020 is €1.08trillion, which represents 1.02 per cent of gross national income for the EU28, before Britain’s departure.” (link)

It’s not as if this hole in the forthcoming EU Budget had suddenly appeared overnight, is it – unless the EU was still certain that Brexit wouldn’t happen, that the good old UK would still be there, available to take the blame for everything. Next:

“Germany wants to spend more on climate change while France is seeking more money for a joint defence, with poorer nations determined to keep their generous EU payouts. But the so-called ‘frugal four’ of Austria, the Netherlands, Denmark and Sweden are unwilling to pay more to plug the gap.” (link)

There doesn’t seem to have been a ‘last-minute’ compromise – perhaps because there were no British pragmatic diplomats around? Instead it’s about finger-pointing and peacocking:

“A frustrated Czech prime minister Andrej Babis said there was ‘no point continuing the summit’ if the ‘Frugal Four’ refused to increase their contributions. ‘If the group of four rich countries Sweden, Denmark, the Netherlands and Austria insist, we can go straight home,’ Babis said today. […] the poorer southern and eastern European nations want to keep generous EU funds coming regardless of Brexit.” (link)   

Bad bad ‘frugals’! How dare they deprive the poorer EU countries from getting more money! Not only is there no compromise, the leaders have simply given up:

“They failed to make a breakthrough after a bitter dispute between EU countries wanting to turn on the spending taps and others who thought the bloc should tighten the purse strings to plug the €75 billion budgetary blackhole left by Brexit. Efforts were made to bridge the gap, but ultimately leaders decided it wasn’t worth continuing negotiations because of the vast differences in thinking.” (link)

These ‘vast differences in thinking’ seem to have come as a total surprise to the Brussels leaders. Well, they are new in their job, but even so, the moans from M Michel and Ms vdLeyen are astonishing:

“Critics say the EU’s most senior official failed in his preparations for the summit and tonight marks his first failure since taking over from predecessor Donald Tusk. The former Belgian prime minister said: “We have worked very hard to reconcile the differences of interests and opinions around the table but we need more time.” European Commission President Ursula von der Leyen added: “We need to continue to work hard, remain on the ball, as we have a long road ahead of us in order to reach a result.” The chief eurocrat warned the bloc would be without funds for development, border protection and research if the EU27 cannot agree an agreement on the budget by the end of the year.” (link)

They ‘need more time’? Doesn’t this sound familiar? As for the excuse that they’ve worked so very hard, implying that they therefore ought to’ve got a prize, i.e. that EU Budget: oh dear! The disarray behind the doors of those EU negotiations are vastly illuminating, for example:

France was forced to deny striking a deal on the European Union budget that secures lucrative cash subsidies for its farmers after an embarrassing ministerial mistake.” (link)

Here’s another piece, showing that apparently the EU is really only about agriculture and forget all those hifalutin sound bites on Climate Change or M Macron’s dream EU army:

“In 2018, eurocrats spent 37 percent of the bloc’s £135 billion annual budget on agricultural projects. The Common Agricultural Policy oversees billions of euros in subsidies to farmers across the EU to help them remain profitable. France is the main beneficiary of the policy, receiving around £7.5 billion a year in cash handouts from Brussels. Whereas farmers in Latvia receive £327 million, with their counterparts in Estonia (£209m) and Lithuania (£597m) also on the rough end of the stick.” (link)

Remember – this is what our EU Danegeld was used for! That the Latvian PM was so very upset is not astonishing. He told the Express:

“Arturs Krisjanis Karins said: “The argument is quite simple, if we are going to subsidise farming, we should do it fairly. Everyone competes in the same market, everyone has similar costs – why punish or benefit some farmers as to others? They should all be on a level playing field, this is what we argue for all sectors of the single market… let’s apply it to farming as well.” (link)

There’s no ‘level playing field’ inside the EU? Who knew! Let’s also not forget that France wants more money because ‘we live in a dangerous world and must spend more on defence’, according to a French MEP (link).

And then there’s Germany … Apparently Ms Merkel is ‘furious’. She has seen the numbers and now we understand that and why the honeymoon between her and Emmanuel is dead, over, done with: 

“Internal negotiating documents, seen by Express.co.uk, show Germany would be expected to make net contributions of around £18billion (€22billion). This is an increase of almost £8billion (€10billion) a year on what Berlin currently sends to Brussels. Whereas France would actually be better off by almost £1.8billion (€2.2billion) compared to the last budget with a total net payment to the EU of just £11billion (€13billion).” (link)

There’s more – here’s why a compromise is not going to happen, not least because it must have suddenly dawned on the rest of the EU member states what they’ve let themselves in for:

“The figures, which are part of Mr Michel’s proposal for an EU budget of 1.074 percent of Gross National Income, are highly favourable to Paris because of its huge farming subsidies under the Common Agricultural Policy. The document shows France and Belgium are the EU’s only net contributor who will benefit from the new package – Austria, the Netherlands, Ireland, Germany, Denmark, Finland and Sweden would all pay more.” (link)

Ms Merkel is also ‘seething’ because the usual French-German block ain’t working, and who can blame her when we read what must’ve been common knowledge amongst Brussels insiders:

“The EU Council chief has been accused of pandering to the President Emmanuel Macron’s demands to keep France’s sizeable agricultural subsidies – worth more than £8billion (€10billion) a year. Diplomats claim the budget caters for all of the French leader’s wishes […] One said: “More Common Agricultural Policy and more defence spending – this is a French budget.” (link)

A French-Belgian axis? Yes indeed – well planned by M Macron who also got that French woman Lagarde to be the director of the ECB. Why am I again reminded of Napoleon’s Empire … !

This ‘Failure in Brussels’ is important because these are the same 27 member states who will have to agree on that Barnier Mandate for the forthcoming Trade talks. The bad blood, created by France, will have repercussions. I hope our negotiators are prepared to exploit to the hilt those divisions inside the crumbling EU monolith. But as always – the proof of the pudding etc …, so:

 

KBO!

 

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