Negotiating a deal on the European Union’s next long-term budget will be a “very tough” job due to the competing and contradictory demands of different national governments, Taoiseach Micheál Martin has said.
The Irish Government will be expected to help broker an agreement on the size and focus of the union’s common budget when it takes over the EU presidency for the second half of this year.
The 27 member states are under pressure to sort out a budget deal before the end of the year, to leave plenty of time for technical work to get new funding schemes up and running by the start of 2028.
The EU’s current €1.2 trillion budget runs until the end of 2027 and encompasses Common Agricultural Policy farm subsidies, regional development grants and a huge range of other funding schemes.
“Our objective will be to get a deal by the end of the year … I think a failure to get there would be problematic for the European Union, but obviously it will depend on member states agreeing, and at the moment some believe the budget is too high, some believe it’s too low,” Martin said.
Speaking on his way in to a two-day summit of EU leaders, Martin said there should not be any “limbo” situation, where the existing seven-year budget expires before the new one is ready.
“Something will have to give and this will be a negotiation which will go the full distance, and it will be very, very tough,” he told reporters in Brussels.
Putting together the bloc’s budget is always a politically charged row between a smaller coalition of “frugal” countries who favour fiscal restraint, and a wider group pushing for a larger pot of money.
A draft €1.73 trillion budget on the table has been criticised by both camps for not going far enough in either direction.
The EU budget is mostly funded by contributions from each member state. A natural division is created between countries that are net-contributors into the joint pot and those that are net-recipients of funds.
Ideas for the EU to raise its own revenue, such as through a levy on large companies or excise taxes, have historically “proved problematic,” Martin said. “Invariably it’s been very difficult to get European Union unanimity or indeed consensus on that.”
Pushing along difficult negotiations will consume a lot of the Government’s focus when Ireland holds the rotating Council of the EU presidency during the second half of this year, a crucial period in the budget talks.
“I was there for the last negotiation [and] as you know we spent a couple of days and nights trying to resolve that,” Martin said.
Separately, the Taoiseach said the EU had to be “careful” in any attempts to redress imbalances in its trading relationship with China, and remain “clear-eyed” about the possible consequences of such a move.
The EU leaders were due to discuss whether the bloc needed to adopt a tougher stance towards Beijing, to better protect European businesses and industries against Chinese competitors who were given an unfair leg-up by the Chinese state.
China has promised to retaliate against any new EU trade measures.
The Government had been “advancing the case of Phil Hogan” in the former EU commissioner and Irish minister’s bid to lead the United Nations’ food security agency, Martin said.
Hogan, who was nominated by Ireland, is one of several candidates in the race for the international job, where each of the 193 countries who are members of the UN body cast a vote.