* Proposal cuts 80 billion euros from original plan
* French minister rejects cut in agriculture spending
* More wrangling likely ahead of Nov. 22 EU summit
By Charlie Dunmore
BRUSSELS, Nov 14 European Union chief Herman Van
Rompuy tabled a compromise draft EU budget on Wednesday, aiming
to mollify Britain which wants spending cuts but risking
angering France by reducing farm subsidies.
Britain has threatened to veto the 7-year budget, saying the
EU should limit spending in light of austerity cuts being made
by national governments. Germany, Sweden and the Netherlands
have demanded similar restraint.
Van Rompuy's draft would reduce the roughly 1 trillion euro
budget for 2014-2020 proposed by the European Commission by
about 80 billion euros and will be discussed by EU leaders
aiming to strike a deal at a summit on Nov. 22-23.
The proposal also safeguards a budget rebate paid to Britain
each year to compensate for the relatively small amount of
agricultural subsidies it receives - a payment that many other
countries resent but recognise would be politically difficult to
withdraw from one of the most Eurosceptic EU member states.
Under the proposal, all EU countries would share the cost.
That means that Britain, paradoxically, would have to pay partly
for its own refund, slightly reducing its net benefit. Payments
would be made to Germany, the Netherlands and Sweden to
compensate them for the cost of Britain's rebate.
The plan also protects EU spending on items such as research
and energy infrastructure, at the expense of more traditional
areas such agriculture, which should please northern European
countries who say the bloc's budget framework is outdated.
But the suggestion to cut farm subsidies drew immediate
criticism from top recipient France.
"We do not accept the proposal to reduce by 25 billion euros
($32 billion) the money for the Common Agricultural Policy,
which we consider a policy for growth," Bernard Cazeneuve,
France's European affairs minister, told parliament.
An even bigger reduction in funds for poorer regions is
likely to face similar opposition from southern and eastern
European countries such as Greece, Italy and the Czech Republic.
But Von Rompuy's 80 billion euros cut to the Commission's
proposal is less than the 100-200 billion that Britain, Germany,
Sweden and the Netherlands want.
"The revised proposal means some small steps in the right
direction but it's not enough," Sweden's EU Minister Birgitta
Ohlsson said. "We need a clear model for reducing agriculture
The proposal also says two-thirds of revenues from a new
financial transaction tax planned by about a dozen EU countries
should be paid directly to the bloc's budget. But the idea is
unlikely to win the support of most of the states involved,
Britain has pushed to reduce the seven-year budget cycle to
five years, something EU diplomats said could form the basis of
a plan B if there is no agreement in November.
"Look at the last EU budget. The economic conditions in
which the budget was agreed in 2005 were thrown into complete
disarray by the financial crisis," Britain's Europe Minister
David Lidington told German weekly Die Zeit.
"There seems to me to be a good case for thinking about a
Britain's enthusiasm partly stems from the fact that the
current budget proposal assumes higher growth in 2019 and 2020.
Excluding those years would lead to a deeper cut in annual