Battle of the budget

Petri Sarvamaa MEP for the European People’s Party – Alexis HAULOT © European Union 2020 – Source : EP

The European Parliament and the Council have come to a provisional agreement on the conditionality of the distribution of funds based on the state of rule of law in Member States. Now if this sentence didn’t make any sense to you at all, that’s understandable. I threw some Brussels Bubble vocabulary in for you. But don’t be alarmed. I’m going to explain it as best I can.

Lets first get you up to speed regarding the Brussels Bubble vocabulary:

European Parliament | Noun | The parliament of the European Union, elected by people in its Member States | The EP
the Council | Noun | Negotiates and adopts legislative acts together with the European Parliament. Consists of Ministers from all Member States 
Provisional Agreement | Noun | An agreement reached between two EU institutions through negotiations. Still needs to be officially voted in to force. 
Conditionality | Noun | The quality of being subject to one or more conditions or requirements being met. 
Distribution | Noun | The action of sharing something out among a number of recipients. In this case Member States. 
Funds | Plural Noun | Cash, Coin, Gold, Bucks. Money is what they’re talking about here. M-O-N-E-Y! 
Rule of Law | Expression | The restriction of the arbitrary exercise of power by subordinating it too well defined and established laws. Basically one of the EU’s most important values. 
Member State | Noun | A country that belongs to a political, economic or trade organization. In this case, all the countries that are part of the European Union. 

If this didn’t help, let me put it this way. A team representing the European Parliament, and a team representing the Council of the EU, have been negotiating about new legislation that is supposed to make sure that the Member States who do not respect the rule of law enough will receive less money from the EU. These specific negotiations started as recently as last October but the EP has been hammering on this topic for quite a while now.

Petri Sarvamaa MEP for the European People’s Party (The Christian Democrats) likes it: “Today’s agreement is a milestone for protecting EU values. For the first time, we have established a mechanism that enables the EU to stop funding governments that disrespect our values such as the rule of law”. But what exactly is he so happy about. Let’s take a look.

The European Union already has some existing tools it can use to protect the rule of law. The Commission can, for example, drag a Member State to court if it believes its government is not respecting those rules. The Commission has done this for example with both Poland and Hungary because it believes the neutrality of their courts is in danger. If the court rules the Commission was right and the Member State doesn’t take action to change it, it risks getting a pretty hefty fine.

The provisional agreement makes the process a little bit easier. Instead of having to go to court the Commission can call upon the Council (the Member States) and ask them to judge the situation. If they find that indeed the Member State is out of order regarding some topics I will cover later, it will vote, by a qualified majority, about whether or not to give it less money from the EU budget. Now take into account that this new agreement is not supposed to replace the old tools the EU has. This is an extra.

What the EP is especially excited about is the fact that they, according to themselves, were able to broaden the scope a little. The law doesn’t just apply to cases where funds are misused through corruption or fraud for example, but will also apply to aspects like freedom, democracy, equality and respect for human rights. They even added ‘threatening the independence of the judiciary’ to the list.

The proposal supposedly even goes as far as to make sure that even if a Member State was to receive less money because of this procedure, citizens who are dependent on EU support like students or farmers would still be able to get it. Through a web platform, they would be able to file a complaint to the Commission, who in its turn will assist them in ensuring they still get their money. 

Now, of course, some Member States are not particularly happy with this. Hungarian Justice Minister Judit Varga for example thinks the European Parliament is blackmailing Member States and urges them to focus on real issues like COVID-19. Orban, the Prime Minister of Hungary, has already threatened to veto the whole EU budget for 2021-2027. A vote that needs unanimity. 

Since both the European Parliament and the Council of the EU still need to vote, threatening a veto is a pretty smart thing to do. Especially since the budget goes hand in hand with the recovery fund that’s supposed to help EU Member States get out of the economic dip that COVID-19 has put them in. A fund that everybody is eager to get its hands on. 

What exactly is going to happen with this new piece of legislation, we don’t know yet. But rest assured, we’re going to keep you up to date.