Statements on the budget

Richard Laming

Why my bank statements come in through the post, I always read them carefully to check up on what has been going on – did I really spend that, I sometimes ask myself, how stupid. I think it’s time that EU budget statements got the same attention. Maybe they will deserve the same conclusion, too.

It was a particularly difficult negotiation this time, I suppose, because (1) there are a lot more countries involved than ever before – 25 rather than 15, and game theorists have shown how much harder it is to reach unanimity in such circumstances and (2) because the member state in the chair was also the member state that was at the centre of the debate. The presidency is supposed to avoid taking sides but the UK had to take a view on the future of the British rebate.

I have written here about the link between the rebate and the overall shape of the budget – it makes sense to consider expenditure as well as income when fixing the budget – but it seems as though the argument for a reform of the whole approach to agricultural spending has not yet been won. (Paul Hilder’s paper that I referred to in a previous blog entry here remains valid.) Conducting this debate remains a central part of the programme for the pro-European case: what do we Europeans wish to do together? We can’t build a better European Union without a clearer answer to this question.

The other thing that needs to be sorted out is the budget setting process itself. The numbers involved may be rather small compared with the rest of public expenditure – read Gavyn Davies in The Guardian here – but the principles are still important. The nearest we get to this discussion in the mainstream British press is the fact that the Chancellor appears not to have been consulted. More to the point, parliament has not been consulted. Billions of pounds have been spent with the wave of the prime minister’s pen.

Much better would be a system of co-decision between the Council of Ministers and the European Parliament, with a distinct and defined source of revenue for the EU rather than simply a raid on national treasuries. If someone wanted to call the funding of the EU a form of stealth tax, they would not be far wrong. An explicit levy on airline fuel, for example, would make it clearer what the EU did (and did not – the sums are small) cost and would help to create the debate among Europeans about what they wish to do together that I mentioned earlier. There are all the environmental benefits, too.

The suggestion that the French have won and the British have lost is nonsense, but nevertheless there is not much cause for satisfaction. The big decisions on how the EU should be funded and what it should with the money have not been settled but merely postponed.

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