Govts reject EU budget compromise
The plan by the EU's Cypriot presidency, sent to capitals late on Monday, recommended the deepest cuts to infrastructure spending in the poorest member states to reduce the total bill, with a less drastic reduction in farm subsidies.
The document will form the basis of negotiations to reach a deal on the seven-year budget for 2014-2020 in time for a summit of EU leaders on Nov. 22-23.
But it angered both richer Western states keen to minimise their contributions as they struggle to reduce national debt, and Eastern newcomers who rely heavily on EU funds for their future economic development.
In times of austerity, the EU budget must not grow. We need to cut three or four times as much as in this proposal to stabilise member states' contributions, said Swedish Minister for EU Affairs Birgitta Ohlsson. Stockholm is a net contributor.
No deal will be possible on the basis of cuts of only 50 billion euro, she added.
Sweden, Germany and Britain have demanded cuts of 100-200 billion euros to the European Commission's proposed 1 trillion euro total, slightly more than 1 percent of the 27-nation bloc's gross domestic product. By contrast national government spending accounts for between 40 and 56 percent of member states' GDP.
A diplomat from Poland, the biggest net recipient of EU funds, criticised
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