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05 Jan

EU Budget latest

Posted by Richard Howarth in EU Budget

A political agreement was reached today ratifying the EU budget which had been agreed earlier in the year. Back in February the EU’s 27 leaders agreed to a cut in the payment ceiling for next 7-year EU budget as the previous budget (see below) comes to an end this year.  The cut to the ceiling reduces the limit from €942.8bn to €908.4bn – a reduction of 3.65%.  This represented the first cut in the EU budget since the formation of the Common Market in 1957. The news was rather overshadowed by the latest set of EU unemployment statistics from Eurostat for April 2013, which highlighted the immense disparity within the EU. While unemployment in Greece is over twice the average at 27% it is less than half the average in Germany - at 5.4%. Membership of the Eurozone was supposed to facilitate the convergence of national economies, and not their divergence.

With youth unemployment reaching 50% in some parts of Europe, the EU has pledged to redirect €6bn of funds to those regions where youth unemployment is greater than 25%, though this is likely to have little impact in the short run in Greece, Spain and Portugal, where the effects of austerity are at their greatest. It should, of course, be noted that spending of just €6bn is around 10% of the budget for administering the EU.

Footnote:

So where exactly does the money go?

Over the period of the previous 7-year budget the total EU budget was €975.8bn, which was allocated as follows:

Sustainable growth - €438.6bn

Includes spending on research and innovation, education and training, trans-European networks, social policy, and economic integration. Also included in ‘sustainable growth’ is spending on convergence of the least developed EU countries and regions, EU strategy for sustainable development outside the least prosperous regions, inter-regional cooperation.

Preservation and management of natural resources - €412.6bn

This includes the much maligned common agricultural policy (CAP), common fisheries policy, rural development and environmental measures.

Citizenship, freedom, security and justice - €12.2bn

This budget covers justice and home affairs, border protection, immigration and asylum policy. Citizenship includes spending on public health, consumer protection, culture, youth, information and dialogue with citizens.

EU as global player - €55.9bn

This covers foreign policy by the EU, but excludes the European Development Fund.

Administration - €55.5bn

Administration includes administrative expenditure of all the European institutions, pensions and EU-run schools for staff members' children.

Sources: The Guardian


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