Jonathan Fryer

Writer, Lecturer, Broadcaster and Liberal Democrat Politician

The EU Budget: The Truth

Posted by jonathanfryer on Thursday, 1st November, 2012

The raging europhobia of the Tory right, now in unholy tandem with Labour after the Opposition’s shamelessly cynical move to vote along with them simply to embarrass the Prime Minister, means that there is a lot of mindless chatter in Britain about what some claim is the big black hole of the EU Budget. So it is extremely timely that the European Movement in the UK has put out an excellent summary of what constitutes the EU Budget and what it actually achieves. And how it benefits Britain! I am reproducing it here in full, as it deserves wider dissemination. The battle against euro-myths and europhobia needs to be won!

– For immediate release –
31 October 2012
European Movement UK calls for a better debate on the benefits of the EU budget
As the Westminster debate on the EU budget delivered a defeat for the PM and a display of political brinkmanship from the opposition that might prove a double edged sword, the European Movement has put together some facts and figures that have been mostly missing from discussions around the EU budget.
The budget of the European Union is an instrument that can help member states achieve economies of scale and reduce spending at home, on areas where better results can be achieved by spending at the EU level. It is an instrument of stability, with a 7 year long perspective and a long-term focus that often is not available to national budgets.
Instead of self-defeating arguments on how to reduce a budget that represents just a bit over 1% of public expenditure, the debate should be focused on how to make the most of EU spending to deliver added value and more benefits for citizens across the EU in general and in Britain in particular.
Everything you wanted to know about the EU budget but were afraid to ask.
The proposed EU budget for 2014-2020 is just 1.05% of EU GDP, whereas Member States’ budgets account for 44% of GDP on average.
Member State budgets are also increasing: In 2012, 24 national budgets out of 27 are due to increase according to the latest estimates.
More than 94% of EU budget goes back to EU citizens, overwhelmingly more than is the case for national budgets.
48% of new EU budget will go to measures promoting growth.
Only 6% will be allocated to administrative expenditure. Administrative reform, which already started a few years ago, has already saved EU taxpayers €3 billion, and it is expected to generate another €5 billion in savings by 2020.
Spending at the EU level can help Member States achieve economies of scale and reduce spending at the national level. €50 billion will be spend to fund transport, energy, and ICT priority infrastructures of pan-European interest, through the Connecting Europe Facility.
In 1985 70% of the EU budget was spent on agriculture. In 2011, direct aid to farmers and market-related expenditure were just 30% of the EU budget.
CAP reform has moved support away from production and towards income-support for farmers and projects to stimulate economic activity in rural areas.
The average EU farmer receives less than half of what the average US farmer receives in public support.
Estimates for 2009 are that the number employed was 5.6 million higher as a result of EU spending through cohesion policy in 2000-2006.
GDP in the EU-25 has been 0.7% higher in 2009 due to EU cohesion policy investments during 2000-2006. This is estimated to rise to 4% by 2020.
Growth in poorer regions and Member States thanks to EU spending leads to purchase of goods and services from another, richer region or member state. EU spending can increase demand at one part of the EU, creating more jobs at another.
EU Cohesion funding helped to revitalize Merseyside, and continues to invest in the Liverpool City Region. £300 million are spend to improve electronic interconnectivity between the UK and Ireland. Satellites for the EU funded Galileo project are built in Britain, creating high-paid jobs.
The UK received the second largest share of Research and Development funding, €2,282m, equal to 14.4% of the total EU spending on R&D.
According to the Court of Auditors, 95% of payments at EU level are correct. Out of the 5% error rate only 0.2% represents fraud. When EU funds are judged to be spend inappropriately, they are clawed back and returned to the EU budget.
The EU budget has never run a deficit.
– Ends –
For further details please contact Lena Donner in the European Movement press team at or 07920 840003.
Notes for Editors:
The European Movement is a cross-party organisation campaigning to inform the debate on European integration and promote understanding of what the EU does and how the UK benefits from EU membership. Its President is Rt Hon Charles Kennedy MP and its Chairman is Petros Fassoulas.

2 Responses to “The EU Budget: The Truth”

  1. […] Merkel is to meet Cameron in London next week There is also a nice break down of the EU budget here Some of the highlights 94% will go back to EU citizens (if only national governments could come […]

  2. […] for unreasonable cuts of 20%. Sweden is calling for a budget freeze and considering using a veto. The EU Budget: The Truth 94% of the budget goes back to member states and only 6% is spend on administration. That and […]

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