British prime minister David Cameron won support from France, Germany and others at a European Union summit today for his opposition to a planned 5.9 per cent increase in the EU's budget for 2011.
The increase in the budget to €130.1 billion was approved by the European Parliament last week, prompting protests from some of the EU's 27 governments, who say spending must not grow so much at a time of austerity.
The EU's annual budget is usually discussed at a level of deputy finance ministers, but Mr Cameron raised the issue at the summit to show his anger at growing spending for the union when his government is pushing ahead with deep spending cuts.
He won assurances from German chancellor Angela Merkel, French president Nicolas Sarkozy and other leaders that they will not abandon a position already agreed by most EU governments that next year's budget will increase 2.9 per cent.
"The Council (EU governments) has proposed an increase in EU budget spending of 2.91 per cent for 2011. We are clear that we cannot accept any more than this," said the statement, signed also by the leaders of the Netherlands, Sweden, the Czech Republic, Denmark, Austria, Finland, Slovenia and Estonia.
"These proposals [of the parliament and the European Commission] are especially unacceptable at a time when we are having to take difficult decisions at national level to control public expenditure," it added.
Mr Cameron, who faces an influential eurosceptic news media at home, made his opposition to an increased budget clear even before the start of the summit, which was to discuss whether the EU needs a treaty change to improve financial stability.
"Six per cent is not acceptable. I will build alliances, work with colleagues, put a stop to that and see if we can do something better," Mr Cameron told reporters.
"It's completely wrong that European institutions should be spending more money on themselves they way that they propose."
The battle over the 2011 budget is a prelude to discussions, due to start next year, on the EU's long-term spending plan after 2013.
EU lawmakers have argued the annual budget outline fits into longer-term planning and reflects higher spending needs resulting from the EU's Lisbon treaty.
They say the EU's budget is relatively small, representing about 1 percent of the bloc's economic output. More than 40 per cent of the budget is spent on agricultural subsidies and a third on aid to poor regions.
"We have opened the discussion so let's see how it goes. There were opinions on both sides [for or against 5.9 per cent]. There was no unanimous support for Cameron but the majority backed him," European Parliament president Jerzy Buzek said.
Negotiators of the parliament and governments will now try to reach compromise on the budget before a mid-November deadline. If they don't, next year's EU spending will be the same as in 2010 and disbursed in 12 equal installments, which experts warn could throw many EU programmes into disarray.
Some lawmakers have said the assembly was ready to discuss a smaller budget for 2011 but in exchange governments should offer political guarantees that the EU would in the future have an independent source of income, rather depend on a good will of governments as is the case now.
The Commission proposed last week several options for the EU to receive an independent source of financing, including a financial transaction tax, energy tax, an EU value added tax or a levy on air transport.
Reuters