Finland says both EU Commission and German caps on EU budget 'unrealistic'

FILE PHOTO: Finnish Minister for European Affairs Tytti Tuppurainen attends a plenary session on preparations for the next EU leaders' summit, at the European Parliament in Brussels, Belgium October 9, 2019. REUTERS/Yves Herman/File Photo

HELSINKI (Reuters) - Finland’s minister for European affairs, Tytti Tuppurainen, said on Wednesday that demands from Germany and elsewhere for a European Union budget worth 1% of the bloc’s combined GDP as well as the EU Commission’s proposal for 1.11% were both unrealistic.

Finland currently holds the EU’s rotating presidency, and Tuppurainen has led talks with member states over its budget for the years 2021-2027, which will be discussed at a summit of national leaders on Thursday and Friday.

Germany, which pays every fourth euro in the EU’s current budget, has called for strict budget control together with other hawks including Sweden, the Netherlands and Austria, which are also net contributors.

At the other end of the scale is the EU Commission’s proposal of capping the EU budget at 1.11% of the combined gross domestic product of the 27 member states.

“These both (1% and 1.11%) seem rather unrealistic in the view of member state positions, so the total budget will fall somewhere in the middle ground,” Tuppurainen told reporters in Helsinki, after a round of talks with each member state.

EU leaders are set to discuss the most divisive points about the budget later this week in Brussels after which Finland will finalize a budget proposal that tries to combine differing views.

“It seems that the member states wish to increase the share of agriculture in the budget” from the 28.5% of the total budget proposed by the Commission, Tuppurainen said, adding that the EU funding for agriculture would still diminish from its current level of around 35%.

EU leaders have set the end of this year as a target deadline for finishing the new budget, but changes in key roles could postpone matters.

The president of the European Council will lead the final phase of the budget talks. Belgian Prime Minister Charles Michel is set to replace Poland’s Donald Tusk in that position in December.

Reporting by Anne Kauranen; Editing by Andrew Heavens and Hugh Lawson