Visegrad countries block EU multi-year budget because of Poland and Hungary

Photo: Doran Erickson via Unsplash

In anticipation of a EU summit starting on Thursday, the four Visegrad countries have criticized the Finnish rotating Presidency of the European Union for a proposal on the adoption of the new multi-annual budget. Not only do Poland, Hungary, the Czech Republic and Slovakia disagree with the size of the budget, they also reject the possible fines for EU countries that do not comply with the EU rules.

When a new European Commission takes office, a new multi-year budget is also regularly established in Brussels, which is not only based on existing agreements and procedures. The new multi-year report also includes money for the wish list of the new European Commissioners.

On the basis of existing agreements, the EU also wants to check from now on when granting subsidies and funds to countries whether such a EU country complies with existing EU rules. In this case, Poland and Hungary risk receiving fewer subsidies because their case law is not transparent enough, and they discriminate against foreign organizations.

EU President Finland has had consultations with all EU countries in recent months, as well as with the current European Commission and with the new committee chairman Ursula von der Leyen. The political leaders of the political groups were also consulted in the newly-elected European Parliament.

On the basis of these consultations, the new multi-annual budget maintains the system that around one third of subsidies are spent on agriculture, which remains the largest EU expenditure item. The question is whether the European Parliament will accept that, because from now on those agricultural subsidies must also be viewed from the point of view of Sustainability and Climate Policy. Up to now there was the impression that any spending cuts would take place mainly in this sector.

In March the European Parliament gave its opinion on the draft budget of the Commission for 2021-2027. It argued for an increase from 1 percent to 1.3 percent of the combined gross national product. In July the government leaders followed with their own position. They want to keep the maximum at the current 1 percent. The European Commission says that growth to 1.13 percent is needed. Discussions are underway to reach agreement between the three EU bodies in the first half of 2020.

The Finnish Presidency prepared a document for the EU summit to facilitate the discussion, based on a questionnaire sent to Member States last July. According to the document, Member States differ in terms of the total contribution to the future MFF (multiannual financial framework) with a range between 1,00% of GNI of EU27 and the Commission proposal of 1,11%.

Consequently, the Finnish Presidency insists on a division between one-third for industrial funds, one-third for agriculture, and one-third for other policy areas. All other wishes for new policies must be paid for by spending cuts elsewhere in the budget.

A diplomat from a Visegrad country told journalists that he hoped that the Finnish memorandum would not be the basis for discussion, and recalled that at least two of the Visegrad countries considered the fine issue as a "no-go." At the same time, he acknowledged that the Netherlands would not give its consent to the new multi-year report without the new sanctions.

The Visegrad Four also have a common position to strongly support the opening of EU accession negotiations by Northern Macedonia and Albania. But a diplomat acknowledged that the French opposition would probably not change.