MEMBER STATES PUSHING FOR BUGET CUTS IN 2015 WHICH MAY AFFECT INNOVATION

EU-Flag-300x225The need to draft an amending budget for the European Union each year may lead to cuts in spending which contradict the multi-annual budget agreed to cover the period 2014- 2020.  Under the budget heading covering growth and jobs, Member States are pushing for cuts of  €1.3 billion for 2015. A 10% reduction being sought for Research and Innovation would have an effect on 600 projects involving more than 7,000 participants, of which around 1400 are SMEs. The figures were presented by Budget Commissioner Jacek Dominik to the European Parliament on 17 September.

Every year, the Commission negotiates with Member States and the European Parliament an amending budget, due to the fact that unpaid bills for previous years keep arriving from the Member States. Ironically, the countries mostly pushing for cuts to the EU budget, such as UK, the Netherlands or Germany, absorb most for them. These countries are in fact among the biggest beneficiaries of research programmes, which would suffer from those cuts.

On the other hand, the EU budget for 2014 also has extra revenues, mostly from fines, amounting to €4.7 billion. Most of the fines are from the banking sector. If flexibility was adopted as a principle as the European Parliament insisted over the adoption of the financial framework 2014-2020, there would be no need to seek an amended budget and the Commission would be free to implement its multi-annual work programmes as originally approved.

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