Merkel 'very optimistic' on EU budget deal

Chancellor Angela Merkel of Germany has said that she is “very optimistic” that national leaders will strike a deal on the European Union's long-term budget at a special summit in Brussels next week (7-8 February).  

Merkel spoke after meeting Mario Monti, Italy's caretaker prime minister, in Berlin today.  

“I am very optimistic that on the question of the long-term EU budget, we will be successful, that we will get an agreement,” Merkel said.  

“Italy and Germany are both net contributors, we have common interests,” she said. “But of course these talks won't be easy and we can expect Italy to push its interests.”  

Monti for his part suggested that he will seek a better deal for his crisis-shaken country.  

“For Italy it is essential for the next European budget to have resources commensurate to the Union's ambitions and to support growth and solidarity,” he said, in comments apparently directed at countries such as Germany, Britain, the Netherlands and Sweden that are pushing for further cuts to the European Commission's €1 trillion proposal for the 2014-20 multi-annual financial framework.  

Speaking in Brussels last night, Monti had hinted Italy might use its veto to block a deal if it believes cuts have gone too far. “The orgy of cuts that certain countries want to apply is inconsistent," he said, suggesting that it would not be "irresponsible" if a member state disagreed with an "inadequate" budget proposal.

Speaking in Berlin, Monti said: “It is also important for Italy's contribution to be proportionate and fair compared to that of other net contributors.” He then attacked the rebates that several member states – most prominently Britain – receive under the current system.  

Werner Faymann, the chancellor of Austria, said in Vienna today that Austria will not agree to be the only member state whose rebate will be eliminated in the new long-term budget.  

“If everyone is prepared to take a big step and to do without rebates – and I'm addressing the UK here – then Austria will also be willing to do without its rebate,” Faymann said in a news conference with José Manuel Barroso, the president of the European Commission. “But it is not a good idea for Austria to be the only one to lose its rebate while all the others keep theirs,” he said. “We are demanding fair treatment on the rebate.”  

Today's meetings were part of intense pre-summit diplomacy, which culminates next Wednesday (6 February) in a meeting in Paris between Merkel and François Hollande, France's president.