EU budget finally agreed - and cut for the first time in history
MEPs have voted through the EU's seven year budget - which includes the first cut in the organisation's history.
In a linked story, the European Court has defeated a challenge to the pay freeze on EU staff imposed by the Council of Ministers, who argued that the EU central administration should be subject to the same austerity they are imposing on their own national administrations.
The budget - called the Multiannual Financial Framework (MFF) - was adopted by the European parliament by 537 votes to 126. Most of the opposition came from the European Left bloc and the Greens, who wanted a bigger budget but surprisingly the many members of the Eurosceptic group, who logically should have welcomed a cut in the EU budget, also voted against.
A political deal on the MFF was reached with EU governments in June, but MEPs bargained for certain conditions, which were finally included in the plan:
The EU budget is equivalent to 1% of the 28 member states' total Gross National Income.
In a separate development, the EU's top court - the European Court of Justice - ruled against a 1.7% staff pay rise which the European Commission had requested.
The level of EU staff salaries and pensions has been frozen since 2011 and the court declined to overturn this. The ruling upheld the view of a majority of EU national administrations who had agreed at the council of ministers that EU remuneration should reflect the budget austerity currently being suffered by employees of their own governments.
The UK Treasury welcomed the ECJ ruling. Treasury Economic Secretary Nicky Morgan said that "as a result of this case, in which the UK played a leading role, Europe's governments have stopped the unjustifiable increases to EU salaries and pensions.
"When governments and families across Europe are taking difficult decisions to make savings, it would be wrong and irresponsible for the EU to not show similar restraint," she added.
In a linked story, the European Court has defeated a challenge to the pay freeze on EU staff imposed by the Council of Ministers, who argued that the EU central administration should be subject to the same austerity they are imposing on their own national administrations.
The budget - called the Multiannual Financial Framework (MFF) - was adopted by the European parliament by 537 votes to 126. Most of the opposition came from the European Left bloc and the Greens, who wanted a bigger budget but surprisingly the many members of the Eurosceptic group, who logically should have welcomed a cut in the EU budget, also voted against.
A political deal on the MFF was reached with EU governments in June, but MEPs bargained for certain conditions, which were finally included in the plan:
- Greater flexibility on switching budget funds;
- EU to retain unspent budget funds, rather than returning to national governments
- extra money for 2013 to cover outstanding bills in the current EU budget;
- and a review of the EU's "own income" resources - that is, EU funds raised directly through taxes, rather than as contributions from national governments.
The EU budget is equivalent to 1% of the 28 member states' total Gross National Income.
In a separate development, the EU's top court - the European Court of Justice - ruled against a 1.7% staff pay rise which the European Commission had requested.
The level of EU staff salaries and pensions has been frozen since 2011 and the court declined to overturn this. The ruling upheld the view of a majority of EU national administrations who had agreed at the council of ministers that EU remuneration should reflect the budget austerity currently being suffered by employees of their own governments.
The UK Treasury welcomed the ECJ ruling. Treasury Economic Secretary Nicky Morgan said that "as a result of this case, in which the UK played a leading role, Europe's governments have stopped the unjustifiable increases to EU salaries and pensions.
"When governments and families across Europe are taking difficult decisions to make savings, it would be wrong and irresponsible for the EU to not show similar restraint," she added.
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