Saturday 9 February 2013

EU budget is no big deal

Today’s newspapers are full of hype about the cut in the European Union budget.

“David Cameron last night declared Victory in Europe,” blares The Sun.

“Cameron claims historic victory,” declares the Daily Telegraph.

“Tough-talking David Cameron forces through first ever EU budget cut,” brags the Daily Express.

So let’s get this in proportion. As the leaders of the four biggest groups in the European Parliament reminded us in a joint statement before the budget negotiations began:
  • The EU budget comprises only about 1% of the combined GDP of all the member states.
  • 94% of the financial contributions that the member states transfer to ‘Brussels’ is returned to member states through the various common policies or is spent on development aid.
  • Administrative costs make up only 6% of the EU budget. The idea that taxpayers’ money is swallowed up by an all-consuming Brussels bureaucracy is a myth.
Also, it’s not just size but what you do with it. As the four group leaders pointed out:
The long-term EU budget must provide added value in terms of growth-boosting investment. It must also allow for flexibility, so that the EU can better react and channel funds to where they are most needed – in particular the investments in infrastructure, innovation and skills that represent the foundations for future sustainable growth.
If the budget is cut by 3% but the cuts fall not on agricultural subsidies but on “investments in infrastructure, innovation and skills that represent the foundations for future sustainable growth,” it will not be a ‘victory’ for anyone.

The cheapest item on the shelf does not necessarily offer the best value for money, so we need to hear more about quality and less about quantity.

And before David Cameron counts his chickens, the budget must still win the approval of the European Parliament.

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