EU budget talks suspended without agreement

Saturday 24 November 2012 10.53
German Chancellor Angela Merkel played down the likelihood of a deal at summit
German Chancellor Angela Merkel played down the likelihood of a deal at summit

Talks on the European Union's seven-year budget have been suspended without agreement.

EU leaders had been meeting in Brussels for a second day of gruelling negotiations as they attempted to agree a budget that will run until 2020.

Speaking after the meeting broke up, Taoiseach Enda Kenny said there is a feeling among leaders that an agreement on a long-term budget will be reached in January next year, during the Irish Presidency of the EU.

Mr Kenny said that there was a feeling of upbeat confidence on the matter.

Asked about the strident position taken by countries like Britain in seeking cuts, Mr Kenny said there was not any bitterness at the contributions and stances being taken.

Talks had resumed this morning after lengthy negotiations last night.

However a revised proposal to reallocate funds, rather than reduce spending, was not successful.

British Prime Minister David Cameron set the tone this morning when he told journalists that now is not the time for tinkering.

He declared bluntly that leaders needed to cut what he termed unaffordable spending from the 2014 to 2020 budget.

The gloomy mood was underlined by German Chancellor Angela Merkel, who said earlier that she doubted an agreement could be reached.

The revised budget keeps a total spending ceiling of €973bn.

Funds for Europe's poorer regions and the agriculture budget would be cut but not by as much as originally intended.

A top EU official said a deal "could still be put together'" but, with Britain demanding cuts rather than re-allocations, the mood music is not good.

Speaking at Dublin Castle this morning, Finance Minister Michael Noonan said "a bit of progress" was made last night, but that it was "too soon" to say when a deal would be made.

He said these were "classic European Union negotiations" and that there was still a lot of talking to do.

European Council President Herman Van Rompuy presented a compromise text after over 12 hours of bilateral negotiations with all 27 EU leaders.

The paper appeared to offer concessions to France on the size of the cuts to the Common Agriculture Policy.

At around €1 trillion the document offered no further overall reduction in the size of the budget - a concession that will have been welcomed by the Government.

It also restored about €8bn to spending on farm supports and €10bn to cohesion funds.

Meanwhile, around 20 farmers spent the night at the European Commission offices in Dublin.

A spokesman for the Irish Farmers' Association said the farmers would remain there for as long as the summit continues.