€4bn EU budget deal agreed

EU: The European Parliament and member states have agreed a deal on the EU budget for 2007-2013 that will see an extra €4 billion…

EU: The European Parliament and member states have agreed a deal on the EU budget for 2007-2013 that will see an extra €4 billion made available to finance projects.

The deal was agreed at midnight on Tuesday followed months of tough negotiations between EU states and the parliament, which was originally seeking €12 billion extra.

The agreement reached between negotiators from the parliament and the Austrian presidency is expected to raise the budget ceiling by €2 billion to €864.4 billion. A further €2 billion will be made available by financing some EU projects from outside the Union's budget, according to yesterday's outline plan.

The deal, which must still be voted on by MEPs in Strasbourg and rubber stamped by member states' officials based in Brussels, should give EU states time to prepare their spending for the release of structural funds in 2007.

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"This is a success. It is a good news for Europe, because we now have the funds to match our ambitions for the development of the EU," commission president José Manuel Barroso told the parliament. "We now have a clear financial framework to boost development of the 10 member states that joined the EU in 2004 and two that are still to join."

About €2.1 billion of the additional cash in the budget will be used for Lisbon Agenda programmes that seek to make the EU more competitive, such as: €800 million for lifelong learning; €500 million for roads, rail and energy networks; €300 million for research and development; and €400 million for small and medium-sized enterprises.

An extra €800 million will go towards the EU's foreign policy commitments, with the remaining cash directed towards a range of areas including youth, culture and farming projects.

But some MEPs complained that the €4 billion in extra spending won by parliament is too little to help kick-start economic growth in the EU and convince the public about the merits of the European project. The parliament's chief budget negotiator, Reimer Böge, said not enough money is available for R&D, transport, the global positioning satellite system Galileo, culture and education projects. "I am not satisfied with this result. . . But under current circumstances all those who participated in the negotiations reached the very limits of what was acceptable," he said.

Parliament president Josep Borrell said he would have wished for more, calling the legislature's resigned attitude to the agreement "satisfied dissatisfaction".