EU leaders agreed on Friday to a significantly reduced seven-year budget worth 960 billion euros (US$1.28 trillion) — the first cut in spending in the 27-country group’s history.
European Council President Herman Van Rompuy announced that the agreement had been reached after two days of nearly round-the-clock negotiations — the longest negotiations of his tenure in office. The final total was about 40 billion euros less than the European Commission had originally proposed.
The issue of what to give to the EU was made more difficult because its members were struggling with poor economic growth and harsh austerity measures, he said.
“We simply could not ignore the extremely difficult economic realities across Europe,” Van Rompuy told reporters. “It had to be a leaner budget.”
He said it would amount to 1 percent of the EU’s gross national income.
The final number was far less than the 1.03 trillion euros the EU’s executive arm, the European Commission, had originally proposed. The 959.988 billion euros total will cover the years 2014 to 2020; the budget for the years 2007 to 2013 was 975.777 billion euros.
The two-day fight over the cap on what the EU can spend on everything from infrastructure to development aid laid bare divisions over what the role of the union should be.
“The effort was worth it,” German Chancellor Angela Merkel said.
“The agreement is good and important,” she said, adding it would show solidarity and ensure predictability.
The European Parliament must still approve the deal — and lawmakers there suggested that the drastic cuts proposed would be unacceptable.
“This agreement will not strengthen the competitiveness of the European economy, but weaken it,” a statement by the leaders of the four largest political groups in the parliament said. “It is not in the prime interest of our European citizens.”
The proposed budget has also been criticized for cutting too deeply into aid for poor countries and other programs critical for Europe.
At its heart, the hard-fought summit in Brussels was a tussle about what the EU stood for: Some leaders argued it was a drag on national budgets in tough economic times, while others said the economic crisis highlighted the need for closer and deeper ties, which would compel the EU to do more than in the past.
The deal that emerged seemed to lean more toward the position of countries led by Britain, which insisted that the EU could not look for more money at a time of belt-tightening across Europe.
“The UK public can be proud that we cut the ‘credit card level’ for the first time ever,” British Prime Minister David Cameron said. “I wanted a cut. That is what I achieved today. Working with allies, this is a great deal for Britain and a great deal for Europe. And a great deal for European taxpayers.”
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