The EU Budget requires reform, say business leaders
Business leaders are urging the EU to seize the opportunity to reform its budget. In a report entitled “A Budget for Business: The corporate community’s recipe for a new EU funding regime”, business argues that the budget should be capped at its current level and that expenditure should be increasingly diverted to areas such as innovation and climate change.
BNE solicited views from businesses in a range of sectors, and received a range of responses from businesses and business leaders. These included views from executives at companies such as KPMG, British, Telecom, Sainsbury, EDS, UBS, Arcelor Mittal, Shell and National Grid.
The main points made by the business community on the reform of the EU budget are:
- Greater expenditure on policy priorities needed to tackle the challenges of globalisation - in particular climate change and world poverty, cementing the EU’s leadership in these areas.
- A focus on the EU's competitiveness with the emerging Asian economies, with a special emphasis on the need to invest in skills and in research and development (investing in measures that help complete the Lisbon competitiveness agenda, especially in financial services, telecoms and energy).
- The CAP should represent a much smaller percentage of the overall budget, in both absolute and relative terms. More than a third of the current Budget is spent on a sector that makes up just 2% of economic activity and 5% employment in the EU. The CAP is expensive and wasteful. Moreover it has a damaging effect on the markets of the poorest parts of the world.
- The budget should be capped at its current level.
- There should be no major change in the revenue-raising arrangements.
Roland Rudd, Chairman of Business for New Europe, said
“This report outlines the broad themes that business would like to see in the reform of the budget. The business community has an important role to play in this debate. Any Chief Executive or Chairman, of course, has a particular interest in budgetary affairs from their own experience of balancing the books in their boardrooms.
We recognise the progress that has already been made, for example reducing the proportion of money spent on the Common Agricultural Policy, but would like to see further reform. These negotiations will not be easy, but President Sarkozy’s intimation that France would be ready to discuss CAP reform on his recent state visit to the UK was especially welcome. We look forward to contributing further to the debate in the coming months.”
Notes to Editors:
1. Business for New Europe (BNE) is an independent coalition of business leaders articulating a positive case for reform in Europe. For further information, see www.bnegroup.org
2. The report on the EU budget was commissioned by BNE in January 2008 and published in April 2008. The full version is available on our website.
3. BNE will be commissioning some polling of business leader attitudes towards EU budget reform later in the year.
