After a day of bilateral meetings and an evening of summiting, European Council president Herman Van Rompuy tabled a new compromise proposal last night with concessions to France and Poland on agriculture and regional aid policy, respectively.
Out of the roughly €15 billion that Van Rompuy had originally proposed to cut from each funding line compared to the European Commission proposal, the new draft proposes to restore €8 billion to agriculture and €10 billion to regional aid. France is the biggest recipient of Common Agricultural Policy (CAP) funds, while Poland is the biggest recipient of regional aid (cohesion) funds.
But the total amount of budget cuts remains the same under the new compromise, meaning that the difference must be made up from other budget lines. And as many had feared, the cuts come from budget items which have no powerful defenders - research, overseas spending and cross-border telecommunications and energy infrastructure.
The Northern European ‘budget hawks' don't seem to be particularly bothered by this, judging by their reactions to the latest compromise. It would appear the most important thing to them is the top line reduction of the budget, no matter where it comes from. France, meanwhile, has a strong interest to make sure those cuts don't come from agriculture. With his waning popularity at home, French president Francois Hollande cannot return to Paris this weekend having cut EU agriculture spending by €15 billion. French farmers would tear him apart.
Nor can Donald Tusk, and other Eastern European leaders, return home with the kind of cuts to regional aid spending envisioned by the original Van Rompuy compromise. But there is no European leader who will be in trouble with their electorate if he or she returns home having brutally slashed research and infrastructure spending.
Dave Keating reports on the interrelated issues of environment, energy, climate change, transport, health, agriculture, fisheries and research for European Voice. In this blog, Dave brings you insights into the sometimes byzantine world of European Union policymaking as well as the equally confusing nature of life in Brussels. Originally from outside New York City, Dave has lived in Europe for six years. He can be reached at DaveKeating@economist.com.
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