EU in critical bid to save budget summit from collapse
BRUSSELS, Belgium - The European Union looked headed for fresh trouble at a summit called to agree a hotly-contested trillion-euro budget, after talks to rescue Greece collapsed and nations haggled over the sums.
EU officials were racing to find a compromise just hours before leaders head to Brussels Thursday, November 22 for the extraordinary two-day summit on the bloc's next longterm budget -- for 2014-2020 -- amid fears of an impasse.
"I don't know if we will have a definitive deal tomorrow or the next day," German Chancellor Angela Merkel told lawmakers Wednesday. "If necessary we will have to meet again at the beginning of next year."
Senior EU diplomats have warned the summit, kicking off at 1900 GMT, could drag on into the weekend.
And even before the start, EU president Herman Van Rompuy is to sit down with individual heads of state and government to finesse a one-size-fits-all compromise.
"Let there be no mistake: the absence of an agreement would be harmful for all of us," Van Rompuy said in a summit invitation letter to the EU's 27 leaders.
After the 17 nations in the eurogroup again failed overnight to agree on a new tranche of rescue aid for Greece held up since June, a collapse of the budget talks would further undermine the EU, already strained by three years of economic crisis.
Austerity-driven nations led by British Prime Minister David Cameron want huge cuts in EU spending to match belt-tightening at home, while others more dependent on EU funding see the longterm budget as a key to more growth and jobs.
Ireland, bailed out by its eurozone partners and preparing to take on the EU rotating presidency in January, warned against summit failure on Wednesday.
"I do not see how further delay will change either the substance of what is involved or improve the political context in which agreement must be reached," said Prime Minister Enda Kenny.
"We have a great deal of work to do if we are to build recovery and return to growth," he said in parliament. "The time for action is now."
In the face of Cameron's determination to secure cuts of up to 240 billion euros in the budget, Van Rompuy last week suggested a 75-billion-euro cut to the proposed 1.047 trillion euro ($1.3 trillion) budget.
But that made no one happy.
Britain wants to see Brussels cut administration costs, Spain said it would lose 20 billion euros of EU aid and France and Italy are refusing any decrease in the budget's biggest item, the subsidies paid to farmers, big and small.
Nobel laureates meanwhile flew in to Brussels to urge EU officials not to strip funds for research and innovation and aid groups warned against cuts in help for the world's poor as well as Europe's own 116 million needy.
"All the talk is only about cuts," said the head of the EU executive Jose Manuel Barroso in an impassioned speech before the European parliament.
"No one is discussing the quality of investments, it's all cut, cut, cut."
He warned that every billion sliced off a research funding programme would mean the loss of 600 researchers and their teams.
"Decisions on the EU's future budgetary framework are a test of our credibility," said Barroso, who heads the European Commission. "The budget is our main tool to invest in growth and job creation."
Eight of the net contributor nations -- Austria, Britain, Denmark, France, Finland, Germany, Netherlands and Sweden -- have banded together to demand spending cuts, though they are far from being on the same page on what should go or by how much.
In the other corner are 15 nations who are net recipients, most often of the so-called "cohesion funds" used to help poor regions catch up economically and socially with the rest. This is the second biggest budget item after the CAP.
Chaired by Poland and Portugal, the group includes Bulgaria, Czech Republic, Estonia, Greece, Hungary, Latvia, Lithuania, Malta, Romania, Slovakia, Slovenia -- and most recently, once mighty Spain.
The latest proposals on the table meanwhile have left Britain having to pay in part for its cherished yearly rebate of 3.6 billion euros, while diminishing Sweden's rebate, and failing to address Denmark's demand to have a discount too.
Asked by a lawmaker Wednesday if he would defend Britain's rebate during the talks, Cameron told parliament: "I can certainly give my honourable friend that assurance.
"The rebate negotiated by Margaret Thatcher is an incredible part of Britain's position in Europe and of making sure we get a fair deal," he said of the former Conservative prime minister.
Cameron said he would be "fighting incredibly hard for a good deal." - Claire Rosemberg, Agence France-Presse