Commentary on the EU budget debate for 2014–2020

The European Taxpayers’ Association calls for a commitment to further austerity measures for the EU’s 2014–2020 financial perspective and demands reforms.

In the debate on the EU’s future financial perspective for 2014 to 2020, the European Taxpayers’ Association (TAE) is calling on the European Commission, the European Parliament and the beneficiary countries to make a clear commitment to austerity measures. “The European Commission must present a genuine austerity budget and make its spending more efficient, rather than continuing to increase revenue,” said Rolf von Hohenhau, President of the European Taxpayers’ Association.

Both the Commission’s original proposal and the amended version for the forthcoming seven-year financial period provide for expenditure of over one trillion euros. Furthermore, the Commission and the EU recipient countries evidently require further funding, even though the strong EU countries – led by Germany – have already provided substantial aid and guarantees to over-indebted states during the crisis. “We have reached the limits of the donor countries’ capacity,” criticises the European Taxpayers’ Association. “How do you explain to taxpayers why the Commission – which is part of the notorious Troika and regularly criticises Greece – is not subject to the same strict budgetary discipline as other EU countries?”

In view of the ongoing sovereign debt crisis in the eurozone, all EU Member States should realise that austerity measures are now essential, says Rolf von Hohenhau. Cuts to the EU budget are therefore more than appropriate in order to bring the seven-year budget below the one trillion euro mark, rather than inflating it further. At the same time, the aid structures must be adapted so that EU funds serve their purpose more effectively. In parallel, the waste of taxpayers’ money at EU level must be further reduced. Around 5 billion euros are wasted in the EU every year. This is because subsidies are awarded recklessly and oversight of these funds is either inadequate or non-existent. Without reforms, future conflicts between the stronger and weaker EU countries are inevitable. This would be completely at odds with the idea of European integration. The European Commission must lead by example and present a genuinely austere budget for the years 2014–2020. Furthermore, on the expenditure side, it must operate more efficiently, said von Hohenhau in his capacity as President of the European Taxpayers’ Association.

Munich/Brussels, 23 November 2012