EU demands above inflation budget rise

Tim Wallace
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THE EUROPEAN Commission (EC) yesterday called for a 6.8 per cent increase in the EU’s budget – a demand the UK vowed to fight.

Commissioners have been pushing member states to cut their own budgets, arguing sustained fiscal discipline is necessary to overcome the debt crisis.

However, it wants member states to give it €136bn (£111.3bn) in 2013, an increase of 6.8 per cent.

Commissioner Janusz Lewandowski argued the budget will “focus on investment and act as an anti-crisis package.”

“We will not restore growth by cuts only; Europe needs to invest wisely for its own future starting today,” he said.

However, UK Treasury minister Mark Hoban said the planned rise is “unacceptable” at a time “when governments across Europe are making difficult decisions on public spending.”

“We will be pushing for a more realistic budget that recognises the economic reality facing Europe.”

Analysts at Open Europe described the EC’s opening demand as “a negotiating tactic.”

“The EC have established an outlier, and in negotiations hope it will end up with something more than zero,” said Mats Persson.

“For the UK, even half that rise would be unacceptable, and really anything other than a freeze will be seen as a negotiation failure.”