Last week’s reflection paper on the Future of EU finances opened the debate on some potentially seismic changes. Reading between the lines, the Commission seems to recognise that it holds a wild card with the EU budget proposal, and that the Future of Europe debate will not actually resolve until the key architecture of the budget is sorted.
But how significant are the reform options it has flagged, and how might they play out politically? Should we read the narrative shift as mere lip service or a genuine intention to move to a more sustainable, people-centred EU budget?
The Commission knows that the smaller budget due to Brexit, combined with the crises facing the EU, gives it legitimacy in proposing to member states fundamental reforms to ensure more targeted and coherent spending. One potentially big change is the option to radically rethink cohesion policy funds, which equal one-third of the EU budget and flow predominantly to poorer member states.
The paper mentions the possibility to allocate these funds according to the location of policy challenges like unemployment, social exclusion and climate change. The inclusion of this option is significant, as an indication of moving beyond the distorting logic of GDP and GNI, which currently determine how the pie is carved.
It also speaks about using incentives to coax reluctant member states to aim higher on structural changes, which could be critical for the clean energy transformation. In the wake of increasing attacks on democracy in Hungary, and beyond, the proposal also picked up on important ideas of linking EU finance with respect for the rule of law and core European values.
It acknowledged that citizens deserve greater transparency in the results of EU spending. Lastly, there is a detectable shift in the overall narrative since the last budget, in that it now stresses the importance of the budget for improving people’s daily lives. Mere words for now, but carefully chosen words nonetheless.
However, it remains to be seen whether the Commission will follow through and propose the sort of budget that we, as civil society, can help defend. The budget also needs to better safeguard the taxpayer’s interests; it makes no sense to spend on fossil fuels and fight climate change at the same time, yet this is what the current budget does.
We need a fresh approach and new sustainability proofing instruments for the design and implementation of the budget, to ensure that it serves the public good. While acknowledging the role of EU financing in driving a social Europe, key issues were avoided. These include the need to ensure that member states grant more equitable access to citizens for benefits of EU-supported programmes.
If the Commission follows through and proposes ambitious reforms, including a budget that ensures a genuinely coherent and ambitious approach to the implementation of Agenda 2030, this could bring us a step closer to the Europe that we, as civil society, want. More in line with the sixth scenario for the future of Europe that has recently been launched with the support of over 250 civil society groups.
Macron is right to propose public debates on the Future of Europe. But the EU budget is where change will first manifest itself. It is precisely by steering the debate and asking citizens how they would best spend EU funds to achieve sustainable well-being in Europe, that the Commission could secure additional political cover for a more inspiring path.
To help, the PeoplesBudget campaign is gathering across Europe. We seek an innovative Budget that empowers citizens and civil society to build a sustainable Europe. With an ambitious implementation of Agenda 2030 and the Sustainable Development Goals at its heart.
Some of our campaign partners call for piloting participatory budgeting in the EU budget, steered towards sustainable ends, as a powerful way to involve citizens in shaping the European project.
The Commission paper suggested a Venture Capital Facility, but what about a Community Power Facility or EU support for social entrepreneurship to spur resilience and unlock local creativity to solve local challenges?
Wouldn’t a truly forward-looking EU budget consider the role of citizens investment platforms, creating a Common European approach that would allow Europeans to place their savings or acquire shares in transformative projects anywhere in Europe? Or a Nature Fund to support the implementation of the Nature Directives?
We want to build a sense of ownership in the European project, a shared destination, a concept of progress worth believing in. If the Commission follows through and finds the courage to propose such reforms, it will be able to count on civil society to help defend them.
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