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MEPs threaten to reject €1.8 trillion EU budget & COVID-19 rescue package

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European Parliament President David Sassoli talks during a news conference following the recovery financial plan deal at the EU leaders summit, at the European Parliament.
European Parliament President David Sassoli talks during a news conference following the recovery financial plan deal at the EU leaders summit, at the European Parliament.   -   Copyright  Francois Lenoir/AP
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European leaders may have agreed on the EU's budget and COVID-19 recovery package after marathon talks, but it is not yet a done deal.

It faced scrutiny in the European Parliament on Thursday.

A total of 465 MEPs voted in favour of a resolution that threatens to withhold their backing for the deal. The resolution states that MEPs "do not accept" the terms of the EU's €1.07tn draft budget that was drawn up after four days of negotiations between member's of the bloc's leaders this week.

The bloc’s budget is intertwined with a pandemic recovery package that will empower Brussels to borrow €750bn on the capital markets and hand it out in the form of loans and grants to stricken economies.

The parliament will use the vote as a mandate in negotiations to try and get improvements to the deal.

MEPs are unhappy about the make-up of the €750 million COVID-19 recovery package, in terms of how much funding is given in grants and how much in loans.

On the 2021-2027 EU budget, they expressed concern about cuts in funding to "future-oriented programmes".

“The European budget as it stands looks more like a 20th-century budget than a 21st-century budget — cuts in research, cuts in the greenest parts of the Common Agricultural Policy,” said Philip Lamberts, a Belgian MEP.

European Commission President Ursula von der Leyen recognised during the debate that parts of the deal were "a bitter pill to swallow". The parliament's largest political grouping, the European People's Party, agrees.

German MEP Manfred Weber said the group was particularly concerned about the long-term spending pot, known as the multiannual financial framework (MFF).

“The Commission will now follow up. We will look into our 2018 proposal for the rule of law, we will work with our co-legislators to ensure that our 2018 proposal is taken forward and where necessary improved,” assured von der Leyen.

Budget cuts

MEPs must sign-off on the package agreed by European leaders earlier this week.

Earlier, the European Parliament's president said there was room for improvement regarding the EU budget.

"There is a proposal on the table, but we would like to improve that, we want to improve it above all by trying to give answers to some of the cuts that we've seen unjustified. If we want to bet on future generations, we cannot cut the budget for research and young people and Erasmus," said David Sassoli.

Weber argued that cuts to research and innovation would put Europe on the backfoot on the global level.

"We promised a strong boost for European innovation," he said. "We are losing ground towards China and Asia on innovation, we are losing our future."

Rule of law

MEPs also want to see rule of law safeguarded. They want clear conditions that countries flouting democratic values will have their funding frozen.

But Momentum Movement MEP Katalin Cseh voiced concerns during the debate over the fact "we are still yet to see how we can protect our European money from anti-European oligarchs who violate the rule of law and have a history of using European funds to their own purposes”.

European Commission President Ursula von der Leyen said that "protecting the budget and rule of law go hand in hand". She added that they will look into the "2018 rule of law proposal & work to ensure that our 2018 proposal is taken forward and is improved".

"Not a single euro should go to those governments that violate our fundamental values," said Socialists and Democrats leader Iraxte Garcia, warning that her group will "remain very firm against any proposal that puts at risk the rule of law".

Outcome

In reality, MEPs are limited in how much they can change.

"They have to approve the EU budget, but they cannot change what has been agreed by the leaders when they vote," said Eric Maurice, director of the Robert Schuman Foundation.

He explained that, politically, it's very difficult for them to reject a deal that everyone has been saying is urgent for weeks.