EU: European Union leaders cannot reunite Europe and achieve their wish-list of policy priorities if they slash the bloc's future budget, the European Commission said yesterday.
Regional Policy Commissioner Michel Barnier said the EU would need more, not less spending to narrow a huge gap between eastern and western Europe after it expands beyond the old Iron Curtain next year.
"We will be dealing with far greater inequalities and fractures than today," Mr Barnier told a news conference.
The Commission would put forward ideas next month on how the European Union could raise its own revenue without having to rely on contributions from national budgets, he said, while acknowledging it had no treaty power to make such a proposal.
This could revive the issue of a "European tax," which is anathema in Euro-sceptical countries such as Britain and Sweden.
He was reacting to a call by six of the EU's biggest net contributors - Germany, France, Britain, the Netherlands, Sweden and Austria - to cut the ceiling on the bloc's budget for 2007-2013 to 1.0 per cent of Gross National Income (GNI) from the present 1.24 per cent.
Budget Commissioner Mr Michaela Schreyer, speaking after the European Parliament approved a 2004 budget that set spending at 0.98 per cent of GNI, the lowest ratio since 1990, branded the leaders' call as inconsistent.
"You cannot at the same time put a wish-list, say we're curbing spending while setting 50 per cent of the budget in concrete," Ms Schreyer said, referring to a deal last year under which EU farm spending will be maintained at current levels until 2013.
Mr Barnier announced an agreement on the implementation of up to €22 billion in regional aid in 2004-2006 for the 10 new member-states that join the bloc next May.
A study released by the EU statistics office Eurostat showed that on average, gross domestic product per capita in the acceding countries was just below half the EU average at 47 per cent in 2002 when purchasing power is taken into account.
Cyprus, the wealthiest acceding country, was about 25 per cent below the EU average, the Czech Republic, Malta and Slovenia were around one-third below, Hungary was just above half but Estonia, Latvia, Lithuania, Slovakia and Poland - by far the biggest accession country - were below half the average.
Mr Barnier said their need for extra EU funds to narrow the gap was highlighted by the fact that enlargement would increase the EU population and territory by 20 per cent but add only 6 per cent to its GDP.
"The European model I'm fighting for is not growth for a few and charity for the rest . . . You cannot win a match by leaving part of the team on the touchline," he said.