EU leaders struggle to break budget deadlock amid veto from Poland and Hungary

EU leaders struggle to break budget deadlock amid veto from Poland and Hungary
Copyright Olivier Matthys/Copyright 2020 The Associated Press.
By Darren McCaffrey, Joanna Gill
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As EU leaders met for a virtual summit, sources said that the videoconference was not the place to discuss such a complicated issue.


EU leaders spent just sixteen minutes on Thursday discussing the topic which threatens to delay Europe's economic recovery from the coronavirus.

The bloc's budget deadlock looks set to continue after Hungary and Poland vetoed the process, claiming a mechanism linking future transfers of money to the issue of the rule of law, was part of an unfair ideological battle being waged by Brussels.

An EU official said that the videoconference was not the 'appropriate format' to discuss such a complicated issue.

According to the same EU source, the leaders did not underestimate the seriousness of situation and wanted to implement the July deal as soon as possible.

Before the summer break, European leaders agreed to the amount the EU can spend over the next seven years. This was set at €1.8 trillion — of which €750 billion is for the coronavirus recovery fund, otherwise known as Next Generation EU.

The rest of the money, €1.074 trillion, makes up the EU's long-term budget, also known as the Multiannual Financial Framework (MFF).

In November, MEPs insisted on making funding transfers conditional upon adherence to democratic values, human rights and the independence of the judiciary.

Budapest block

For Balázs Hidvéghi, a Hungarian MEP from the ruling Fidesz party, the deal struck in July was a good deal. He told Euronews that there is no debate over helping to save the financial interests of the EU.

"But when we talk about the rule of law, which is not clearly defined and it's an ideological sort of subjective matter that that one side of the arena has been misusing, but then that is not to be linked to any functioning of the EU," he claimed.

But opposition politicians in Hungary are keen to point out that this view is not shared by everyone.

“It is very important to state that over 70 percent of Hungarians support the rule of law conditionality," says Katalin Cseh, MEP, Hungary's Momentum Movement. She explains that Hungarian businesses, and local authorities need the money from the recovery fund and from budget.

"The opposition tries to send a message to the wold that Mr Orbán is not equal to Hungary. There is indeed a significant demand for the conditionality mechanism and also that we don't want to block the budget as Hungarians.”

EU values on the line

Some view this as a pivotal moment for the European Union, when leaders must stand firm against Hungary and Poland. Alberto Alemanno, EU Law Professor HEC Paris, explains that EU membership comes with terms and conditions:

“If you want to be a member of the European Union you need to respect the rule of law, that means you need to have a a judiciary which is independent, you need to have a media which is absolutely free to say what they want within the constitutional limitations.

"Those violations have been occurring for too long, they have been systemic, they have been persistent, they have been recognized by all kind of organizations around, it is possible, it is no longer acceptable to be a member of the European Union like Poland and Hungary, receiving European funds and not respect the rule of law.”

There was little expectation that this summit would managed to finalise a deal, and indeed this mechanism would not ultimately solve the rule of law issue.

But with time not on their side and Europe’s economies not facing deeper recessions - EU leaders will be hoping a compromise can be found, and soon.

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