Budget for 2011 passed by European Parliament


THE EUROPEAN Parliament yesterday approved the 2011 EU budget, allaying fears that payments to Ireland – such as those to farmers – might be disrupted. This was a real concern in the light of inter-institutional fighting within the union, which had threatened the budget’s passage.

It is the first budget constructed under the new rules imposed by the Lisbon Treaty which abolished the distinction between compulsory expenditures (like those included in the common agricultural policy) and non-compulsory expenditures.

This meant that the European Council and European Parliament were forced to agree on all expenditure together for the first time.

The final modifications made by the council following almost two months of negotiations between the two European institutions was discussed on Tuesday in parliament, where there was consensus that it was crucial a budget of some kind be passed during the current plenary session in Strasbourg. It was passed yesterday by a large majority.

The parliament had at first suggested that overall expenditure be increased by 6 per cent. However, the European Council – made up of the heads of state – demanded that the EU shoulder similar budgetary austerity measures as member states.

It proposed an increase of just under 3 per cent, a figure the parliament agreed on in return for seven political demands, some of which have yet to be conceded.

The two most contentious issues which have still to be negotiated are the parliament’s involvement in future financial framework discussions and an ability to create its own resources.

While parliament’s negotiators were content with the assurances given to them by the next four EU presidencies of Hungary, Poland, Denmark and Cyprus with regard to their role in future financial framework talks, the request for “own resources” has not been agreed.

This would allow the EU to generate its own funds and not rely so heavily on council consent. It now awaits a proposal from the European Commission at the end of June 2011 on the issue.