The cuts towards farming and agricultural subsidies have been anticipated for some time but that does not mean that they were always going to be welcome.
The proposed budget represents 1.1% of the total gross national income (GNI) of the bloc which reduces to 27 nations after the UK leaves the Union. The number is currently at 1%.
However, tensions between Europe’s richer countries, which pay more in than they get out, and the poorer countries, which rely on EU funding in order to catch up, look set to sharpen. There is the perception that this budget lacks a degree of fairness and balance that may prove to make passing this budget a slight headache for the Commission.
As predicted an increase in security spending has been offset by sharp cuts to the farming and agricultural subsidies. There will be a massive 5% cut to the Common Agricultural Policy, which will now see a budget of €365bn. This is likely to have a drastic impact on many of the farming economies, including France. Additionally, there will be a 7% cut to so-called cohesion funding. This is unlikely to be received as a popular move, as former Soviet states in eastern Europe are its biggest beneficiaries.
The EU has also said that it wants the farm subsidies to be better balanced, benefiting medium-sized and smaller farms, and a subsidy cap per farm.
But such a drastic cut to the agricultural sector is already being perceived as unfair and unbalanced when looking at other areas of the budget. There will for example, be a massive budget increase from €12bn to €33bn for border management, migration and refugee flows. There will also be a 64% increase in research, innovation and digital investment under direct management and funding for the Erasmus student scheme will be doubled to reach more young people from disadvantaged backgrounds
Already France’s Agricultural Minister, Stephane Travert has expressed his serious concern at the amount of cuts that the agricultural sector will see from this latest budget. Tweeting earlier today he said that “a drastic, massive and blind cut is simply unthinkable.” These cuts to the agricultural sector are unlikely to be well-received in other members and given the importance of the sector, it’s important to ask whether the EU has been wise to introduce such drastic cuts so quickly to such a volatile sector.
But also the sheer size of the budget is attracting criticism. The full list of new proposals amount to €22bn per year.
The Dutch Prime Minister Mark Rutte, has said this is just simply “not acceptable” and that “a smaller EU means a smaller budget.” He stressed that this is the time for the EU to look towards cutting inefficiency fairly across member states and having an inward look at whether the Commission could be more efficient with its spending.
But there has been serious concern raised over the evenness of the distribution. Sweden for example, must now make an enormous 35 per cent increase in contributions to the EU in a move that the Swedish Government has labelled as “unreasonable.” The German finance Minister too has called for a more equal distribution of spending across the member states.
The EU will have a long fight ahead of it whilst it tries to pass this budget. This budget isn’t being viewed as a fair and equal spread both across sectors and across the countries. This may mean we see a very different by the end of the negotiating stage.