Deal on new EU budget will trigger release of €6 billion to combat youth unemployment

The Government capped six months in charge of Europe’s political agenda with a deal on a new EU budget, an agreement which will trigger the release of €6 billion to combat youth unemployment in the union.

The agreement on the budget between member states and the European Parliament was welcomed as a big achievement for Ireland's presidency of the council of the EU, which finishes on Sunday.

The €960 billion budget, to be dispersed between 2014 and 2020, embraces a commitment to a formal review in 2016. This measure was adopted at the insistence of the parliament, whose negotiators said the wishes of MEPs who take their seats after next year’s election should be taken into account.

Included in the package is €6 billion to be dispersed in 2014 and 2015 to pay for a new “youth guarantee” against unemployment.

People below the age of 25 – in countries where the youth unemployment rate exceeds 25 per cent – will have the right to retraining, apprenticeships or further education within four months of becoming unemployed or leaving education.

Ireland may be a beneficiary as the youth unemployment rate was 26.7 per cent in the first quarter of the year but the extent of any support remains unclear.

The budget deal was reached at special talks at the headquarters of the European Commission in Brussels.

The negotiators included Taoiseach Enda Kenny and Tánaiste Eamon Gilmore, EU commission president José Manuel Barroso and president of the parliament, Martin Schulz.

The agreement followed a separate deal by the Irish presidency on Wednesday to reform the common agricultural policy and an agreement in the early hours yesterday on EU rules to minimise the exposure of taxpayers to future bank collapses.

While the overall budget is subject to a vote next week of the European Parliament and to the sign-off by member states, all sides expressed confidence in the compromise.

“We came here this morning to get a political agreement and I am happy that we have got that political agreement,” Mr Kenny said.

Mr Schulz warned, however, that a battle still loomed in the parliament to secure the assent of MEPs. “This is not what I thought would be the best solution,” he said. “One per cent of something is more than 100 per cent of nothing and therefore I can live with the result and I will fight for the result.”

Mr Gilmore told reporters that Mr Schulz had achieved much more than 1 per cent of what he was seeking to achieve. Asked if there was any danger that MEPs would repudiate the deal, the Tánaiste said he was counting on success.