PISM Seminar: Negotiations on the EU Multilateral Financial Framework 2014-2020

The negotiations on the new EU funding period are among the most important topics on the European Union’s agenda and are priorities for Polish policy in the EU. The multiannual financial framework (MFF) sets out the overall EU expenditure ceilings for the next seven years. On this basis, annual EU budgets are set. Poland, as the biggest net beneficiary, is making efforts to prevent cuts in the overall size of the budget and is defending the existing role of cohesion policy.

At the beginning of the seminar, Mr. Tokarski delivered a short introduction to the debate, presenting the main points of a recent PISM Policy Paper, “The EU Budgetary Chess Game, the Polish Presidency and the Shadows of the Debt Crisis”, which he co-authored with Mr. Toporowski. The article focused on the new, more complex context of the negotiations, mainly due to euro zone problems. The debt crisis reinforced the logic of the net contributors, who are in favour of a considerable reduction in the general EU budget. As well, because of Central European countries different perceptions of their own interests, it is not certain how durable the coalition of “friends of cohesion” really is. With negotiation participants having conflicting interests because of their passive attitudes, it will be difficult to expect more ambitious changes in the revenue and expenditure structures of the new MFF 2014–2020.

After the introductory remarks, the main discussion started with Mr. Rowinski, who presented the logic behind the European Commission’s proposal for the MFF that was published on 29 June 2011. The aim of the European Commission was to work out a compromise proposal acceptable to all the Member States as a basis for negotiations. The EC also attempted to deliver high added-value and meet the objectives of the “Europe 2020” initiative. Mr. Rowinski said that the fact that the EC proposal is now the basis of the negotiations is largely due to the Polish EU Council presidency. Mr. Burkiewicz summarized the negotiations during the Polish presidency and the further schedule for negotiations. The aim of the Polish presidency was to enable Member States to carefully examine the Commission’s proposal and to include  all Member States in the discussion, even those with weaker bargaining power. Mr. Sajdak presented the point of view of the Polish Ministry of Finance, discussing problems with contributions to the EU budget as well as issues of new own-resources, such as financial transactions taxes or using portions of national VAT to partially replace national contributions. The last speaker, Mr. Toporowski, posed arguments against the logic of the net contributors and also explained why the EU general budget is an important investment vehicle at a time when national budgets are subject to cuts. He also expressed the view that cuts in the EU budget should be sought outside cohesion policy.

A question-and-answer session followed and great interest was expressed by the audience.