Abstract

http://ssrn.com/abstract=1898678
 
 

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Europe for Growth: For a Radical Change in Financing the EU


Jutta Haug


affiliation not provided to SSRN

Alain Lamassoure


Parlement Europeen

Guy Verhofstadt


affiliation not provided to SSRN

Daniel Gros


Centre for European Policy Studies, Brussels; CESifo (Center for Economic Studies and Ifo Institute)

Gaëtane Ricard-Nihoul


affiliation not provided to SSRN

Paul De Grauwe


London School of Economics & Political Science (LSE); CESifo (Center for Economic Studies and Ifo Institute for Economic Research); Centre for Economic Policy Research (CEPR)

Eulalia Rubio


affiliation not provided to SSRN

April 6, 2011

Jutta Haug, Alain Lamassoure, Guy Verhofstadt, Daniel Gros, Paul De Grauwe, Gaëtane Ricard-Nihoul & Eulalia Rubio, EUROPE FOR GROWTH: FOR A RADICAL CHANGE IN FINANCING THE EU, CEPS Paperbacks, 2011

Abstract:     
The system for financing the EU today is on its last legs. Indeed, with the EU budget being predominantly financed by national contributions, member states attach great importance to what they get in return, which in the end affects the European principle of solidarity and makes every budgetary negotiation a potential arena for political blockage. The economic and financial crisis, with its corresponding increase in the public deficit of member states, has unfortunately worsened the situation.

Fully funding the European Union with own resources is the only way to put an end to the fair return approach and to make the necessary changes to EU spending that would provide it with the financial means equal to its needs and allow it to face the challenges of the future.

On the eve of the presentation of a new proposal for own resources announced by the European Commission, Jutta Haug, Alain Lamassoure and Guy Verhofstadt, Members of the European Parliament belonging to three different political groups, have brought together their views and present this report as their contribution to the debate.

Economists Daniel Gros and Paul De Grauwe of CEPS and Gaëtane Ricard-Nihoul and Eulalia Rubio of Notre Europe have collaborated with them in this important project. They demonstrate in this report that fully financing an EU budget of the size it is today with genuine own resources is not a dream but that such a change is feasible, provided that the political will to reform the current system can be summoned. Moreover, they find that it would not infringe on the member states’ fiscal sovereignty. On the contrary, it would reinforce the link between the European Union and its citizens, putting an end to member states' tendency to calculate their net returns and possibly even enabling them to make cuts to their public expenditure. Finally, such a reform would represent a return to the spirit and the letter of the Treaty of Rome, which contained a clear aspiration for financial autonomy and which prevailed until the end of the 1980s.

Number of Pages in PDF File: 86

Keywords: economic crisis, financial crisis, EU, budget, EU budget, member states, public deficit, European Union

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Date posted: July 31, 2011  

Suggested Citation

Haug, Jutta and Lamassoure, Alain and Verhofstadt, Guy and Gros, Daniel and Ricard-Nihoul, Gaëtane and De Grauwe, Paul and Rubio, Eulalia, Europe for Growth: For a Radical Change in Financing the EU (April 6, 2011). Jutta Haug, Alain Lamassoure, Guy Verhofstadt, Daniel Gros, Paul De Grauwe, Gaëtane Ricard-Nihoul & Eulalia Rubio, EUROPE FOR GROWTH: FOR A RADICAL CHANGE IN FINANCING THE EU, CEPS Paperbacks, 2011. Available at SSRN: http://ssrn.com/abstract=1898678

Contact Information

Jutta Haug
affiliation not provided to SSRN
Alain Lamassoure
Parlement Europeen ( email )
Bât. Altiero Spinelli
60 rue Wiertz / Wiertzstraat 60
Brussels, B-1047
Belgium
Guy Verhofstadt
affiliation not provided to SSRN
Daniel Gros (Contact Author)
Centre for European Policy Studies, Brussels ( email )
1 Place du Congres
B-1000 Brussels, 1000
Belgium
CESifo (Center for Economic Studies and Ifo Institute)
Poschinger Str. 5
Munich, DE-81679
Germany
HOME PAGE: http://www.CESifo.de
Gaëtane Ricard-Nihoul
affiliation not provided to SSRN
Paul De Grauwe
London School of Economics & Political Science (LSE) ( email )
Houghton Street
London, WC2A 2AE
United Kingdom
CESifo (Center for Economic Studies and Ifo Institute for Economic Research)
Poschinger Str. 5
Munich, DE-81679
Germany
Centre for Economic Policy Research (CEPR)
77 Bastwick Street
London, EC1V 3PZ
United Kingdom
Eulalia Rubio
affiliation not provided to SSRN
Feedback to SSRN


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