“We are a little tired of paying money which is then redistributed in discounts to other countries around us! “. In February, Amélie de Montchalin, then Secretary of State for European Affairs, did not hide all the harm that France thinks of rebates to the European budget, these budgetary corrections which benefit Germany, Denmark, the Netherlands, the ‘Austria and Sweden (the last four are nicknamed the “frugal”).
Five months later, the question of discounts still plagues relations between the Twenty-Seven. These rebates have even become a central element of the European Council convened since Friday 17 on the negotiation of the post-Covid recovery plan for the Old Continent and its next budget for the period 2021-2027.
→ READ. European recovery: the 27 are playing their last chance
Those who benefit from these rebates are very attached to them. “The ‘frugal’ strongly insisted that the discounts be maintained, and even recently asked that they be increased”, recalls Marta Pilati, researcher at the European Policy Center (EPC) think tank, who adds that “The discounts are a negotiating tool in their own right, because if they are revised upwards, they can be used to convince the most reluctant to increase the overall size of the stimulus plan and the budget”.
National contributions to this budget – or “Multiannual financial framework” (CFP) in Brussels jargon – are calculated, according to the European Commission, which proposes a new CFP every seven years, “On the basis of their relative economic power”. Concretely, this ” power “ is measured through gross national income (GNI) – an economic criterion considered objective.
But in the past, some countries (first and foremost the UK, as early as 1984, when Margaret Thatcher was in power) felt that they were paying too much into the EU budget compared to others. To satisfy them, it was therefore necessary to put in place compensation mechanisms in order to “correct” the financial contributions which seemed excessive.
Thus, for the period 2014-2020 for example, the Netherlands benefited from a gross reduction in their annual contribution to the budget of 695 million euros. For Denmark, it is 130 million euros less per year, and for Sweden, 185 million. For the Commission as well as a good number of Member States (almost twenty, led in particular by France), Brexit should have rhyme with the disappearance of these discounts.
→ READ. European revival, the Netherlands “preventing people from going around in circles”
In October, President Emmanuel Macron declared that a budget that “Multiply the discounts, it’s a budget where everyone looks at the quota that comes to them after what they put in, that is to say everything except a budget”. On the European Parliament side, for Johan Van Overtveldt, head of the Budgets Committee, the system of rebates is clearly “Exceeded”.
The latter should in any case be maintained and even extended, to appease countries reluctant to the recovery plan. It is even a sine qua non including for Berlin, which nevertheless defends this mechanism of financial solidarity alongside France.
In the latest versions of the budget put on the table by the President of the European Council Charles Michel, for the period 2021-2027, the corrections granted to Germany amounted to 3,671 million euros each year, those of the Low at 1,576 million, those of Sweden at 823 million, those of Austria at 287 million and those of Denmark at 222 million.