The False Economies of Cutting the EU’s budget

by David Schoibl

There was a tradition in Central and Eastern Europe for local authorities to provide a communal oven for baking. An oven that is fired at all times during the day for local residents to use. Not only does it save fuel bills of the individual households, it reduces CO2 emissions, fire risk and can lead to innovation, exchange of best practice (people will exchange and improve recipes and other knowledge) and instil a sense of community. While the local authority has to have a budget for such a communal oven, the local residents benefit from the added value of cumulative saving of doing things together.

Within the EU, member-states have asked the EU to take on new responsibilities by ratifying the Lisbon Treaty. However, now that it comes to funding the work – which is significantly more than before – some of them do not want to fund it. This is no different from political parties before elections promising to improve public services whilst promising at the same time to lower taxes.

The European Parliament – notably the most ‘democratic’ of all EU institutions, as it is directly elected, has strongly argued for an increase in the budget to fund new programmes and protect very successful programmes, which are under threat.

One area of the budget which is reported to be under threat is the student exchange programme ERASMUS, which has been highly successful, but already lacked 90m Euros in the current year. Through this programme, tens of thousands of students have had the opportunity to study abroad, learn languages, make international contacts for life, and participate in an active, positive exchange of European cultures.

An example for a new budget post in the new EU budget is the European External Action Service. It did not exist yet when the 2007 – 2013 financial perspectives were negotiated. Running a global network of embassies is an expensive undertaking even for the biggest member-states, but it is much cheaper than waging war when a lack of diplomacy leads to breakdowns in understanding between people and countries. When the European External Action Service was set up, it was clear that doing some of the external action function together will demand a higher EU budget. There is the potential of cumulatively saving member-states multiples of the money spent jointly, but that element seems to be lost in public discussions at the moment. Has anyone asked a parliamentary question yet about the potential savings to the foreign office budget in pooling activities within the EEAS?

To fund improved foreign policy tools in an increasingly more volatile world seems reasonable. So does the EU Parliament’s call to invest in economic growth, which has this week also been mirrored by EU Commission President Manuel Barroso at a meeting of European Conservatives (notably British Conservatives left this organisation), where he too called for a ‘coalition of growth’, and a budget to match this.

The  austerity only approach does not work. Not in the UK, not in the EU. Investment in sustainable growth is necessary.

It is not possible to look at the EU budget as a stand-alone item, so the question is why it is so convenient in national political discourse to avoid talking about the fact that the EU is a give and take, not just a ‘giving to Europe’.

It puzzles me why discussions about the EU budget in the UK seem so narrow in their outlook. Why can we not be more creative when looking at the EU budget and try to understand the potential cumulative saving to be had by doing more together? This would mean increasing the EU budget to cumulatively reduce spending by all member-states individually – which is in line with the need to be as efficient about things as possible in times of financial crisis. If we talked about a business, the benefits and business sense of pooling resources – and then funding this joint enterprise – would make sense to all.

When the European budget is discussed though, many switch to a ‘them and us’-laden prejudice, which suddenly only looks at perceived power relationships, and no longer focuses on how to do things best. Polarizing opinion may be a way to get votes in some cases, but it is not helpful here. Digging in heels before even reaching the negotiation table, where common ground and communal, mutual interests should be the focus, is not helpful, especially at times, when we need to work as efficiently as possible – efficiency might just be reached through working together.



  • David Schoibl has shown how Ed Balls and Douglas Alexander have tripped over themselves to “out flank the Tories on Cuts” (The Times, 29th Oct,12) forgetting the multiplyer function of growth by acting together – their commitment to growth is nationalistic and myopic and lacks the greater good represented by the European community as a whole.

  • All I am trying to do is to explore an alternative narrative regarding the EU. A narrative based on the virutes of co-operation, working together for the common good and solidarity. This is an attempt to connect traditional values of the Labour Movement (which we find traditionally easier to express in a domestic context) with how we think and talk about European and global politics. We need to find ways to convince progressive parties and politicians that developing this narrative will help not hinder with achiving their main goal, gaining or maintaining power by maximizing votes.

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