The EU budget needs to be reformed – in order to provide Europe with the necessary resources to address its challenges and policy priorities. The EU High Level Group on Own Resources (HLGOR) recommends reforms both on the revenue and the expenditure side, which are vital in order to answer citizens’ concerns. This was the main message of the debate on the future financing of the EU with Mario Monti, former Italian Prime Minister and EU Commissioner, at the EESC on 6th April.
The EESC has since long advocated the introduction of a new system of own resources that would help abandon the debate on net balances (juste retour principle) which is contrary to the values of solidarity and mutual benefit that underpin European integration.
During the debate, Joost van Iersel, EESC’s ECO Section President, reminded that a recent EESC opinion “considers that the present Multiannual Financial Framework and the post-2020 version should concentrate their resources sufficiently, directing them towards programmes that can relaunch economic, social and environmental development and stimulate employment, innovation and competitiveness, very much in line with the recommendations of the high level group.”
The event was organised by the EESC’s Section for Economic and Monetary Union and Economic and Social Cohesion(ECO). The debate with the Chair of the High Level Group on Own Resources, Mario Monti, focused on the findings and recommendations of the Group’s recently published final report.
“The current EU budget is inadequate - as it cannot provide countercyclical economic policy, nor finance adequately the policies of the EU in general”, declared Stefano Palmieri, EESC rapporteur on EU Budget 2014-2020. “Going forward post 2020, the budget needs to be planned in full accordance with article 3 of the Treaty on European Union, stipulating that "The Union's aim is to promote (…) the well-being of its peoples. In order to stimulate growth and employment, bolster investment and combat youth unemployment, etc. - we are calling for securing the necessary means for Europe to carry out these strategic priorities. There must be a link between the own resources and these priorities. We want to produce European added value!”
“Own resources will give more strength to the EU", declared Anne Demelenne, EESC co-rapporteur on Euro area economic policy (2016), who also called for "harmful tax competition between Member States must be eliminated. The EU needs to address a topic that is currently not tackled – the social one – we must urgently allow the financing of a social union, by financing the social pillar, the European minimum revenue – and this would require resources.”
Petr Zahradnik, EESC rapporteur on a Performance-based EU budget, called for “broad political consensus on what the EU does – a budget with real benefits and impact, as well as new proportions and weights of the different spending areas. Simplification of procedures is equally crucial, as well as more flexibility to react to urgent challenges. Furthermore, the EESC favours a wider use of repayable instruments instead of grants and subsidies in the use of the EU budget. EU financing represents one of our biggest challenges and represents the crossroads where the EU is currently standing”. He was skeptical on a dedicated budget for the Eurozone.
The high-level group on own resources (HLGOR) was established in February 2014 to reflect on finding more transparent, simple, fair and democratically accountable ways to finance the EU. Chaired by Mario Monti, the Group was composed of Members designated by the European Parliament, the Council and the European Commission.