A 6% reduction to the EU budget for 2014 – represents the first time the EU budget has been cut in 56 years. The main instigator of the push for the Budget to be cut was the British government. I find it extremely disappointing, considering the serious impact this will have on large sections of the population of the North that the Unionist parties, both at Westminster and in the European Parliament, supported the British demand for budgetary cuts.
The direct effect of this will see the Cohesion Funds cut next year from €55billion to €47.6billion and agriculture and fisheries budgets slashed by a Billion Euro. The draft figures for next year show that the British government has agreed a huge reduction of 22% in real terms in the field of rural development – the biggest reduction any member state will experience. The motivating factor in the British government’s demand for cuts would seem to be its aversion to contribute 25% match funding. While the British see a 25% contribution as a cost, the Irish government view it as a mechanism to have 75% of a programme funded by Europe. This ill-conceived determination by the British government to achieve cuts in the EU Budget at all costs will have a devastating impact for rural areas which rely on Rural Development Funding to modernize and plan for the future.
As a result of this action, funding for the PEACE Programmes will also be reduced from €225million to €150million which will undermine a lot of the good work which has been done through previous PEACE funding.
The Joint First Ministers, Peter Robinson and Martin McGuinness succeeded in mitigating this reduction by negotiating as part of the recent Economic package with the British Prime Minister, a £50million contribution towards PEACE programmes. But this still leaves these projects £25million short of what was provided in the last seven years with no allowance for inflation.
Unfortunately the Unionist MPs at Westminster and their MEPs are enthusiastic cheerleaders for the British government push for cuts to the EU budget as part of its general austerity agenda. Unless the EU Budgetary framework is revised following the next European Parliament elections the cuts will bite deeper as the years roll by.
Under this formula in the current round of funding the 26 Counties will receive Pillar 2 monies of just under €2 billion for a population of 4.6 million representing € 423 per capita.
In comparison, the UK allocation of Pillar 2 monies will be €2.3 billion for a population of 64.7 million which pro rata will deliver a mere €35 per capita to residents of the six counties. By accepting a 22% real term allocation reduction in line with its austerity agenda the British government has reduced access to EU funding to less than 10% of that available to their counterparts in the South of Ireland for those in the North entitled to this funding.
In the CAP reform negotiations in particular, the Sinn Féin focus at all times was to secure 3 key elements – well funded programmes, flexibility and simplification. The CAP Budget is approximately 40% of the EU expenditure – and the pressure to reduce it came from Tories in London and unfortunately, supported by the unionist Parties in Westminster and their two MEPs.
The Single Farm Payments (SFP) equals approximately £270m per year and the Rural Development Programme (RDP) £500m. If Whitehall uses the same formula in allocating available funding to the Assembly, then our entitlements will be severely reduced to £244m SFP and £340m RDP proportionate to EU cuts respectively, possibly resulting in our Farmers struggling to remain in farming under this Single Farm Payment regime.
Unfortunately the British government’s negotiators were more focussed on securing budget cuts rather than acquiring the best possible outcome for the people.
There will be a further challenge ahead as Scotland has signalled its intention to pursue a larger portion of the allocation from Whitehall. If it is successful it could result in a further reduction in our allowance. But in a blatant manipulation of available funding and attempts to protect their sitting MEPs, EU governments will frontload budget allocations so that the cuts will not impact until after the 2014 European elections.
Those MEPs and governing parties who supported the cut to the EU budget must explain the rational of their actions to the farmers and rural areas that will bear the brunt of these cuts on top of all the other austerity measures that they are already struggling under.