2012-2013 EU BUDGETS : BERLIN AND PARIS KEY TO UNLOCKING STALEMATE.

Two countries hold the key to unlocking the stalemate over the payment top-up needs in the current EU budget and the expenditure for next year. If Germany and France manage to find common ground with the European Parliament, the whole negotiation could be over on 13 November. Failing that, a deal would likely be postponed until the end of the month after the European Council dedicated to the 2014-2020 multiannual financial framework (MFF). This could mean that solidarity assistance to Italy, victim of a series of earthquakes (see box), for which there is an agreement on the sum but not the means to finance it, will continue to be held hostage.

Meeting with member states in conciliation, the European Parliament's delegation refused to negotiate, on 9 November, on the 2013 EU budget. Earlier that day in an Economic and Financial Affairs Council, eight member states called for redeployments, to varying degrees, within the 2012 EU budget to meet the additional 9 billion needs identified by the European Commission, mostly on the basis of national repayment claims. "We are not going to talk about next year's budget if member states refuse to honour the commitments they took for this year," Alain Lamassoure (EPP, France), leading the EP's negotiating team, told Europolitics at the time.

To try to broker a deal before the last day of conciliation, on 13 November, the European Commission put a compromise on the table whereby it sticks to its 9 billion request but spreads it over this year and the next: +7.6 billion to the 2012 EU budget and +1.4 billion rolled over to next year. This does not make things any easier to swallow for Germany, France, the United Kingdom, the Netherlands, Sweden, Denmark, Finland and Austria, which either do not want to bring any fresh money to the table this year or want to limit that to the bare minimum and also refuse to go above the Council's agreed position on the 2013 EU budget in terms of payments (132.7 billion). Unless the Commission finds ways to shift around funds in the current expenditure, none of these countries will give their green light. Despite Budget Commissioner Janusz Lewandowski's protests that he is...