Euro parliament rejects calls for EU budget freeze

The European Parliament on Wednesday voted overwhelmingly against a real-terms freeze on the European Union budget for the rest of the decade, as sought by big EU member states led by Britain. Euro MPs voted by 468 to 134 at the parliament's Strasbourg session to reject the freeze on 2013 levels for the years from 2014 to 2020 -- instead demanding a minimum five percent increase. They also issued an indirect challenge to Britain, whose Prime Minister David Cameron has made taming EU spending increases something of a personal crusade, and who has gathered support from Germany, France, the Netherlands and Finland for domestic austerity to be reflected in Brussels. The lawmakers called for an end to the multi-billion-euro system of annual rebates received by the likes of Britain or Denmark in lieu of massive farm payments to France or other big agricultural states. A parliamentary statement said they called for an end to the "rebates, exceptions and correction mechanisms." EU budget commissioner Janusz Lewandowski hailed the vote but warned of "difficult negotiations" with governments. Negotiations are due to start when the EU executive, the European Commission, presents on June 29 draft figures and ideas on how to boost the direct raising of funds via EU-level taxes on businesses and citizens, as opposed to member state contributions measured by size or wealth. The statement said Euro MPs argued that "the current funding method places disproportionate emphasis on net balances between member states, contradicts the principle of EU solidarity, dilutes the European common interest and largely ignores the advantages of financing policies at EU level."