EU crisis: Brexit budget blackhole row boils over as nations ‘fight like ferrets in sack’

Cracks are starting to emerge in the 27-member bloc, who put on a united front in Brexit talks, as they prepare to battle it out over the Union’s €1.1 trillion budget for the next seven years. Europe is effectively split into two opposing camps ahead of a crunch budget summit on Thursday where EU members will discuss how to plug a huge €75billion (£62billion) hole in the bloc’s budget after Brexit.

On one side is the ‘frugal five’ – Netherlands, Germany, Austria, Sweden and Denmark – and on the other is a group of less wealthy EU member states calling itself the ‘Friends of Cohesion’, which rejects cuts in regional funds and the Common Agricultural Policy (CAP).

One EU diplomat said: “And now we are fighting like ferrets in a sack.”

A senior Brussels official admitted: “In this negotiation, we are not expecting member states to be happy, but the degree of dissatisfaction will be key.”

The European Commission has been pushing members to increase contributions of 1.11 percent as a share of gross national income (GNI).

But Austria, the Netherlands and Germany have demanded a 1 percent cap instead.

Dutch Prime Minister Mark Rutte insisted his nation should not contribute more in the face of the EU’s financial woes following Britain’s exit from the bloc.

While Austrian Prime Minister Sebastian Kurz has also threatened to veto any increase to the EU budget and outgoing German Chancellor Angela Merkel has called for a spending cap.

The 15 countries under the Friends of Cohesion include: Poland, Malta, Slovenia, Estonia, Hungary, Czech Republic, Slovakia, Croatia, Romania, Latvia, Greece, Bulgaria, Cyprus, Lithuania and Portugal.

EU members will meet on February 20 for a summit to broker the 2021-2027 budget.

The news comes after senior[ members of the European Parliament threatened to plunge the EU into chaos by vetoing the bloc’s next multi-annual budget if their demands aren’t met.

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They vowed to block the EU budget if member states refuse to hand over more cash for the fight against climate change, digitalisation and to further the bloc’s geopolitical ambitions.

Five political leaders in the Parliament wrote in an open letter to EU Council President Charles Michel, writing: “The Parliament will not give its consent to the MFF without an agreement of reform of the EU’s own resources system.”

The letter was penned by the EPP’s Manfred Weber, socialist chief Iratxe Garcia Perez, Renew Europe’s Dacian Ciolos, and the Greens’ Ska Keller and Philippe Lambert.

Britain accounted for around 15 percent of the EU’s economy and was by far the bloc’s biggest military spender.

The current EU budget amounts to 1 percent of the bloc’s combined Gross National Income (GNI).

The European Commission has proposed a seven-year budget of about 1.1 trillion euros that would be about 1.11 percent of the EU’s combined GNI.

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