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11/7/05

Dow Jones News: EU return to budget debate today

Dow Jones News

EU return to budget debate today

The European Union nations return to debating EU funding for the years ahead Monday, a debate that collapsed at the June summit amid nasty exchanges between France and Britain over farm spending that eats up 40% of the bloc's annual outlays.

Ahead of an EU foreign ministers meeting, officials said Britain - which holds the EU presidency - would not propose new spending figures. Rather, Foreign Secretary Jack Straw was looking for a commitment to revamp EU spending or consider new funding criteria, they said.

For the 2007-2013 period, the EU executive Commission has proposed outlays totaling $1.04 trillion, about 1.1% of the EU's gross national income. However, austerity-minded Germany, the Netherlands, Sweden, Austria, Britain and others want outlays capped at 1.0% - the current spending level - and shift spending from the farm sector to research, development and education to promote high tech jobs. Agricultural spending - that guarantees incomes for farmers - still consumes 40% of the EU budget which this year totals just over $119.3 billion.

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