EU short €20bn for 2013

The European Union is likely to be 20 billion euros ($27 billion) in the red in 2013, forcing the bloc to transfer payment of unpaid bills to 2014, a European source said Thursday. The source, who asked not to be identified, said the forecast shortfall on this year's 132.8-billion-euro budget was discussed at talks between the European Commission, which is the bloc's executive, the European Parliament, and Lithuania, which currently holds the rotating EU presidency. The Commission told EU lawmakers that requests for reimbursements from member states between now and year's end were expected to amount to 50 billion euros but that there were only 30 billion euros left in the coffers. The Commission as a rule meets payments requested up until October but may delay payment on bills submitted later in the year until 2014. The EU budget, largely made up of contributions from member states, makes its way back to these countries in the form of financing for the agricultural sector or regional projects. The EU is also the world's top aid donor. The shortfall is likely to exacerbate friction over the budget between member states and the European parliament, already angry over proposed cuts in EU spending by austerity-minded national governments. The Commission had already asked for an extra 11.2 billion euros in 2013 to cover unpaid bills from 2012, and lawmakers had approved proposals for the next longterm 2014-2020 budget only on condition that member states cover these bills. Governments had asked to pay that sum in two instalments, with 7.3 billion euros paid up during the summer. Last week the Commission reminded governments that it was awaiting a further 3.9 billion euros. Next month the European Parliament is set to vote on the final approval to the 960-billion-euro ($1.25-trillion) 2014-2020 EU budget at a plenary session October 21-24. Agreement on the seven-year budget, which cuts spending for the first time, has been held up by months of squabbling between governments, the parliament and the EU executive. The parliament and Commission had been at odds with austerity hardliners Britain, Germany and the Netherlands, who early this year shot down plans to increase spending and instead pushed through a historic three-percent cut. Notably at stake are plans to quickly put billions of euros into measures to help Europe's 5.6 million unemployed people under the age of 25.