The European Union demands more money from the member states.
(Photo: dpa)
Brussels When the USA startled the Europeans last year with their massive green subsidy program IRA, Ursula von der Leyen spearheaded the counter-movement. With her own European “sovereignty fund” for future investments, the EU Commission President wanted to counter the American declaration of war.
A few months later, she surprisingly dumped the fund. When presenting the revised medium-term financial framework (2021 to 2027) on Tuesday, she no longer mentioned the financial package. Instead, she spoke of “STEP”, short for “Strategic Technologies for Europe Platform”.
This is a very slimmed down version of the original idea. Above all, the Commission now wants to reallocate funds from other budget items, such as unclaimed aid for structurally weak regions. In addition, the member states should provide an additional ten billion euros to increase existing EU programs such as the innovation fund, InvestEU or the European Defense Fund.
The investments are necessary to strengthen Europe’s competitiveness, said von der Leyen. They want to focus on projects in the areas of deeptech, cleantech and biotech.
EU budget commissioner Johannes Hahn explained that the idea of the sovereignty fund had been reshaped to be faster. One does not want to get bogged down in negotiations about a new fund, but instead use the existing programs. “We don’t have to reinvent the wheel,” said Hahn.
Commission seeks showdown with Member States
Competitiveness is one of three EU priorities for which von der Leyen is demanding fresh money from the member states. For the second priority – migration – it estimated an additional 15 billion euros. And thirdly, Ukraine is to receive up to 50 billion euros, but not all directly from the EU budget.
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In total, the Commission needs 65.8 billion euros from the member states for the next four years, said von der Leyen. It is an “absolute must”. The authority has already shifted funds, reprioritized them and mobilized every possible euro for Ukraine. EUR 30 billion went into Ukraine alone, which was not foreseen when the 2020 financial framework was drawn up. Therefore, the budget must now be reorganized.
This means a showdown with the member states, which are currently pursuing an austerity course themselves and are showing little willingness to transfer money to Brussels. Federal Finance Minister Christian Lindner (FDP) had already rejected an increase in the EU budget in Luxembourg on Friday. At best, he was open to more support for Ukraine. His fellow finance ministers, Bruno Le Maire from France and Sigrid Kaag from the Netherlands, argued similarly.
Opinions differ in the European Parliament. FDP MP Moritz Körner said there was enough money in the EU budget. Only a fraction of the funds from the Corona reconstruction fund have been transferred so far, and most of the structural funds have not flowed out either.
The CSU MEP Markus Ferber (CSU), on the other hand, showed understanding for the commission. The EU’s multiannual financial framework was “squeezed like a lemon” in the face of the Ukraine war and inflation, he said. “You won’t get there just by shifting funds.”
Criticism from the European Parliament of Lindner and Le Maire
The Conservative criticized the reaction of member states. You couldn’t always just say no, he said. “One cannot at the same time call for an EU that is capable of acting, constantly assigning it new tasks and then ducking away when it comes to financing these very expenditures.”
The spokesman for the German Greens in the European Parliament, Rasmus Andresen, also called for additional funds for the EU budget. The future of Europe must not be saved, he said. The EU is facing increasing security spending and has to assert itself globally as an industrial power.
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Budget Commissioner Johannes Hahn said the 65.8 billion euros were “not the result of an artificial calculation operation”. If the EU wants to be a serious player in the world, it needs these additional resources. An EU official said the numbers are small even when compared to what leaders expected the Commission to do.
Hahn emphasized that an agreement with the Member States and Parliament is needed by mid-November so that the 2024 budget can be decided in good time.
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