On Thursday, the heads of government of the EU countries will gather in Brussels to discuss the new multiannual budget. Given the significant disagreements, this convened financial summit will not lead to consensus or an agreement, but at best to a political understanding of the need to modernize the EU’s portfolio of tasks.
The core of the problem is that several countries and political leaders recognize that the modus operandi and portfolio of the European Union, which has existed for 75 years, needs to be ‘modernized’, and that the EU should take on more and different tasks. Climate policy, the Green Deal and new energy, better monitoring of external borders, fair distribution of asylum seeker reception, and modern technology policy are examples of this.
But since most EU countries do not want to increase their annual contributions to Brussels, there is no money for these desired new tasks, and thus there will have to be cuts in current tasks. The question is, why should the EU still do what it has been doing for decades? The European agricultural policy, which accounts for €59 billion per year, over a third of the total budget, is a significant part of this. The Netherlands is one of the countries that believes the budget for the Common Agricultural Policy (CAP) can be reduced by a quarter.
Precisely this week, the usually well-informed magazine Politico revealed that behind the Brussels scenes, at the very highest level, there has long been a battle over those agricultural subsidies. The highest official of the Agriculture department, the Director-General, is opposed to making the evaluation and awarding of agricultural subsidies subordinate to a too-rapid transition to the Green Deal. This emerges from leaked internal emails.
The top agriculture official in Brussels believes that current agricultural subsidies cannot be stopped or reduced immediately. Not stopping, but first slowing down, is reportedly his argument. It is expected that especially France and Poland will oppose a reduction in agricultural subsidies. In the compromise proposal presented by EU President Charles Michel, a small part of the current subsidy is reallocated as direct ‘income support’ to farmers, and less money goes to large agricultural corporations.
At the end of March, proposals are expected concerning the ‘farm to fork’ strategy and the 2030 biodiversity strategy. These will weigh heavily on the new CAP, if the European Commission has its way. EU member states will have to include in their CAP plans that at least 40% of expenditures contribute to climate objectives. The European Climate Law will anchor this, so the new CAP plans will in any case be assessed against climate policy. Therefore, it is not expected that specific amounts regarding cuts to agricultural spending will be mentioned in Brussels at this point.
Dutch Prime Minister Mark Rutte will maintain during the special EU summit in the coming days his desire to prevent growth in the European budget and Dutch contributions. Even if this means receiving a more modern EU budget in return, Prime Minister Mark Rutte does not want to see an increase in contributions.
Rutte said this Tuesday evening during a parliamentary debate in The Hague. The proposal recently made by EU President Charles Michel must, according to Rutte, be taken off the table. The Dutch position to avoid increasing the European budget is, according to Rutte, merely a means to ensure that the Netherlands will at least not pay more than it already does.
The European Commission wants to increase the EU budget to 1.11 percent of the combined economy of all EU countries. EU President Charles Michel, with a compromise proposal, aims for a budget of 1.074 percent. For the Netherlands, this corresponds to an increase of 2 billion euros. Rutte leaves room for a budget increase, as long as it does not mean that the Netherlands will contribute more net.