MFF post-2020 negotiations should be used to put an end to 'business as usual'
Europe must give itself the means to succeed and make room for more budgetary flexibility, says Jean Arthuis.
Jean Arthuis | Photo credit: European Parliament audiovisual
Globalisation has resulted in new threats and challenges that EU member states cannot take on at national level.
Security and defence, climate change, tackling the root causes of migration and welcoming refugees, the digital economy and preventing cyberattacks - without collective action on these topics, without European integration, we will suffer.
We will be subject to US, Chinese, Russian and Indian imperialism. We will also be subject to the financial and technological power of multinationals.
- Bernd Kölmel: MFF post-2020: Why the EU should cut back on CAP
- Petr Zahradník: MFF post-2020 is a unique opportunity for EU reform
The implementation of the current financial framework (MFF) 2014-2020 has demonstrated the EU’s inability to cope with the challenges of a globalised world.
A lack of resources and flexibility means Europe is incapable of dealing with crises and unexpected events, such as the mass migration of 2015. Its budget is limited to one per cent of its GDP - that’s 1/50th of member states’ average national budget.
Moreover, nearly 80 per cent of the budget is redistributed equally among the member states to finance the common agricultural policy and cohesion policy, which helps less developed regions.
These two pillars should not be called into question. The first protects our food safety while the second ensures territorial solidarity and supports populations in need. These two pillars are instrumental in leveraging investment in infrastructure, public facilities, education and training.
This of course takes planning. Effectiveness requires predictability and therefore a robust multiannual framework that can be extended to other programmes, such as those dedicated to research (Horizon 2020), communication infrastructure (Connecting Europe Facility), SMEs (COSME) and student and trainee mobility (Erasmus+).
Political priorities and funds must be defined and agreed upon early to allow them to come into force as soon as the next MFF is launched.
It is important to remember that the current financial framework, which was adopted in December 2013, was marked by detrimental inertia in 2014, 2015 and beyond. Beneficiaries needed time to familiarise themselves with programmes that were belatedly defined - a paradox, considering that at the time, Europe suffered from a lack of investment. We must be careful not to repeat the mistake.
Therefore, the European institutions must move quickly, given the impending European parliamentary elections and the establishment of a new Commission in 2019.
The MFF must serve as the basic budgetary foundation, without impeding on new developments and potential adjustments. What kind of budget for what kind of Europe?
In the current context, it would make no sense to lock action in a stranglehold, that prevents any evolution until 2027. Nor would it make sense for the Commission to continue to resort to satellites - as it has thought necessary in recent years - to counteract the lack of budgetary flexibility.
This tinkering devotes a whole ‘budgetary galaxy’ that transgresses both the principle of budgetary unity, and its democratic accountability.
A budget should be the numbered transcript of a common vision, a responsible ambition and a political project. Devising another inflexible MFF without first defining our objectives and agreeing on Europe’s ‘common goods’ is simply putting the cart before the horse.
If Europe’s budgetary foundation is adopted quickly - before the 2019 elections - it would be wise to include a revision clause to take into account the public will, which will be expressed when a new Parliament is elected. Europe must fill the €14bn hole left in its budget by the UK’s withdrawal.
It must also give itself the means to respond to citizens’ concerns. A Europe that prepares us for the future and protects us cannot become a global power with a budget of just one per cent of GDP.
However, increasing the European budget must not result in an increase in public spending. In other words, increasing the European budget should mean relieving national budgets.
Consequently, we must identify those competencies that member states can no longer handle efficiently on their own - defence, security, climate action, space policy, migration and digital economy. Any funds set aside for these areas at national level could then be reinvested in the European budget. We must demonstrate that transferring these competencies and funds illustrate Europe’s added value.
Two issues remain: finding new own resources and the eurozone’s budgetary capacity. Finding answers on the former would lift the tyranny of the ‘juste retour’ principle, which is damaging our community spirit. The latter would require separating that capacity from the overall EU budget for as long as some member states retain their national currency.
We must use these next few months for fruitful democratic debate and dare to put an end to ‘business as usual’.
Portugal’s central bank must correct its mistaken bail-in, if it wants to rebuild trust with the international investment community.
To remain world leaders in research and innovation, Europe’s universities need more supportive policies and funding frameworks
Will the EU's 'payments package' help or hinder Europe's economic growth? Gilbert Arira asks.