EU leaders can't agree yet on post-Brexit budget

Posted February 23rd, 2018

BRUSSELS — 

European Union leaders are unlikely to agree this year on a new multiyear budget that will plug a huge funding gap caused by Britain's departure from the bloc, European Council President Donald Tusk said Friday.

Speaking after a summit of EU leaders — minus Britain's prime minister — Tusk acknowledged divisions among the 27 nations but sought to paint an upbeat picture. He said leaders approached the budget negotiations with "open minds rather than red lines" and agreed the bloc will spend more on key issues such increased defense and stemming illegal migration.

"Despite usual differences, all leaders are ready to work on the modernization of the EU budget and its policies and many are ready to contribute more to the post-2020 budget," he said.

But not all.

"We, in any case, do not want our contribution to rise," said Dutch Prime Minister Mark Rutte, who is facing pressure at home not to stump up any extra cash for Brussels.

He said the EU needs to modernize and reform existing programs to free up cash for issues like security and migration.

"This is going to be a huge process," Rutte said.

Britain is set to leave the EU — the first country to exit the world's biggest trading bloc — in late March 2019. But Brexit talks on Britain's departure must be finalized by this fall so EU nations' parliaments can ratify any withdrawal agreement.

The EU's executive commission estimates that Britain's planned departure will cut contributions by around 12 billion euros ($14.8 billion) a year. Britain has agreed to pay its budget share until 2020.

European Commission President Jean-Claude Juncker said last month that the EU's 2014-2020 budget, which totals some 1.09 trillion euros ($1.34 trillion), is insufficient to fund the bloc's growing ambitions in areas such as defense, tackling migration and border control.

Brexit won't just cause financial headaches — it could also shrink the European parliament, with fewer lawmakers, known as MEPs.

Tusk said leaders "broadly supported the idea that fewer member states should mean fewer seats, which means reducing the number of MEPs from 751 to 705."

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