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Exclusive: Germany wants to cap next EU budget at 1%, seeks more funds for climate and migration

Exclusive: Germany wants to cap next EU budget at 1%, seeks more funds for climate and migration
FILE PHOTO: The European Union and German nation flags are pictured at the lower house of parliament Bundestag in Berlin, Germany, June 28, 2016. REUTERS/Fabrizio Bensch -
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Fabrizio Bensch(Reuters)
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BRUSSELS/BERLIN (Reuters) – Germany wants to cap the European Union’s next budget for 2021-27 at 1% of the continent’s economy, a scenario that would still see Berlin contribute some 10 billion euros more every year, according to a document seen by Reuters.

“We will conduct the MFF (Multiannual Financial Framework or the long-term EU budget) negotiations on the basis of 1% of the EU27 GNI,” read the document, which Germany is presenting to its EU peers during ministerial talks in Brussels on Monday.

“Losing the UK as one of the largest next contributors to the MFF means that even with this limit, contributions of the remaining Member States will increase significantly.”

Germany – the EU’s largest economy and the biggest contributor to the bloc’s joint coffers – also demanded that its poorer regions benefiting from EU development aid should not be excessively hit in any revamp of the so-called cohesion funds.

It demanded “strong or additional” incentives on migration and climate projects, and insisted that all EU spending should be subject to rule of law conditionality as the bloc moves to curb aid to members like Poland or Hungary that stand accused of violating core rules by undercutting democratic standards.

“Germany and France have jointly proposed that revenues accruing to member states from a Financial Transaction Tax could play a role in financing the (euro zone budget) in the form of assigned revenues,” the paper added.

(Reporting by Gabriela Baczynska and Riham Alkousaa; Editing by John Chalmers)

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