EU Commission warns: Germany's €400bn budget cut would hurt frugal countries' own priorities

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BRUSSELS — EU budget commissioner Piotr Serafin warned frugal countries that drastic cuts to the bloc’s proposed €2 trillion budget would disproportionally hit their own priorities.

Serafin’s intervention on Thursday comes after Germany this week proposed downsizing the bloc’s next seven-year cash pot by €400 billion, roughly a fifth of its total value. Germany and its allies criticized a 2 percent cut to the budget proposed last month by the Cypriot presidency of the Council of the EU as insufficient.

But in a stinging rebuke, Serafin warned that demands for drastic cuts may undermine the frugals’ priority to steer billions from traditional priorities such as agricultural to “modern” policies including defense and competitiveness.

“A more frugal EU budget may not necessarily be modern,” he said in the opening speech of the Commission’s annual budget conference.

“The risk is that those new aspects of modernity will be the first ones to be chopped.”

The frugals are pressuring the new Irish Council presidency, which will broker the budget negotiations, to pursue deeper overall cuts while protecting spending on defense and competitiveness.

They also dismissed Cyprus’ proposed cuts, arguing that they disproportionately targeted their priority areas.

In his speech, Serafin also warned that smaller collective EU spending might result in a higher bill for national governments.

“Too often, a disunited approach means a higher bill: more duplication and fewer economies of scale,” he said.

“In many areas, the alternative to European spending is not no spending at all. It is national spending.”