BRUSSELS — Northern European countries are gathering in Vienna on Thursday to forge a common front ahead of two years of fierce negotiations on the EU’s next seven-year budget.
It’s the first time that top officials from the EU’s richer countries — including France, Germany and the Nordics — have convened in the same room to build a strategy on the European Commission’s controversial €1.816 trillion budget proposal.
The goal is to assemble a bloc ahead of talks with countries such as Poland, Spain and Italy that favor higher spending, particularly on agriculture and funding to poorer regions.
Since the budget was unveiled on July 16, officials have had just enough time to flick through hundreds of pages and start crunching how much money they’ll gain and lose from the Commission’s new spending plan.
Official budget negotiations have barely begun, but behind the scenes, civil servants from like-minded countries are already plotting. Ministers won’t attend the gathering in Vienna — they’ll next discuss the budget in October at an EU-level meeting.
In every budget negotiation, countries with similar interests gang up to develop common attack lines, hold joint meetings with the Commission and divide up practical tasks like testing the formulas that allocate the money.
The ultimate goal is to outmaneuver the rival camp, win the negotiations and steer the EU’s mammoth budget closer to their priorities.
“In football terms, this is a set piece. It’s something normal,” Polish Member of the European Parliament Janusz Lewandowski, who served as the EU’s budget commissioner from 2010 to 2014, told POLITICO.
L’union fait la force
Instead of everyone fighting for themselves, the EU’s 27 countries coalesce in two broad camps.
On one side are the affluent “net payers” — spanning Sweden to France — who contribute more than they receive from the EU budget and are generally in favor of a slimmer cash pot.
The rival camp, known as the Friends of Cohesion, is a broad alliance of Southern and Eastern European countries including Italy, Spain and Poland that favor a bigger budget — especially when it comes to “cohesion funds” that support poorer regions across the bloc.
“As so many things in the world, the MFF [Multiannual Financial Framework, the EU’s long-term budget] is not defined by economics, but by history,” said Stefan Imhof, secretary-general at the Austrian Federal Ministry of Finance, during an event earlier this month.
There are obvious differences within each camp. For example, net-paying France and the Netherlands have wildly different agendas on issues such as EU-level debt, which Paris favors and The Hague opposes.
On the issue of agricultural subsidies, France is more aligned with high-spending Poland than with members of its own club.
But countries try to resolve such differences within their respective clubs, where they settle on key positions such as what the overall size of the budget should be.
The group meeting in Vienna on Thursday will be led by the EU’s two powerhouses.
“At the end, it’s France and Germany agreeing on the figure and us poodles follow through,” said an EU diplomat from a net-paying country with knowledge of the talks who, like others quoted in this story, was granted anonymity to speak freely.
In the other camp, Poland usually takes the lead as the country getting the most money out of the EU budget.
However, Warsaw’s decades-old double act with Hungary — with whom it shares key interests — has been undermined by a rift with Prime Minister Viktor Orbán, whose democratic backsliding at home has led to the Commission withholding billions in funding.
This has opened the door for Mediterranean countries — who also support generous funding for poorer regions — to play a stronger coordinating role inside the coalition.
On Sept. 1, Malta chaired a gathering of budget experts from the Friends of Cohesion, which laid the ground for the first technical meeting among the EU’s 27 countries the following day.
Seasoned budget negotiators argue that key decisions are taken in these cozy meetings. Last March, net payers agreed to earmark €175 billion for the Horizon research program — which was confirmed by the Commission shortly after — during an informal gathering in Helsinki, according to the EU diplomat.
Where the Commission stands
Waiting on the sidelines, the Commission will lobby national governments to stay close to its original proposal during the negotiations with the Council and the Parliament.
In the coming months, Budget Commissioner Piotr Serafin — a former Polish ambassador to the EU who knows the Council like the back of his hand — will broker talks between the net payers and the Friends of Cohesion.
Caught between the two warring tribes, the commissioner “can see all the cards on the table,” a Commission official said.
A seasoned budget negotiator, Lewandowski said the commissioner must strive to “divide et impera [divide and conquer] as opposed to consolidating blocs” in the Council.
Lewandowski’s advice to Serafin, who served as his aide during his stint as commissioner, is to “approach countries one by one … rather than confronting two big groups,” as that weakens the power of member countries vis-à-vis the Commission.
With tough and dramatic shouting matches around the corner, there are only a few crucial certainties for the negotiators.
“This [Commission] proposal won’t be what we’re going to agree on at the end, everyone will have to move …. [But] there has always been a deal, and we are going to manage a deal this time as well,” Austria’s Imhof said.
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