Deal or No Deal

The European External Action Service (EEAS) is to be formally launched on Wednesday, the first anniversary of the Lisbon Treaty being put into force.  Senior Brussels figures have warned that a failure to break the deadlock over 2011 spending would mean that the EU will not be able to properly finance its new diplomatic corps.

The major change comes on 1 January when 1,525 senior officials, 114 of whom earn more money than William Haig, are transferred from the European Commission and other EU institutions to work directly under the authority of Baroness Ashton.

The power shift can only take place if the European Parliament and national governments agree on an EU budget for next year by Christmas.  David Cameron has blocked agreement on the spending plans because MEPs and the Commission have tried to increase the budget at a time of national austerity.

If there is no budget deal, the officials will remain in their current posts and the new diplomatic service will not be put into service.  Funding for operating costs of the EEAS, under the control of Lady Ashton, has been set at £404 million for 2011.  By 2013 the EU's new foreign policy arm will have a total budget of £8 billion - nearly four times the £2.2 billion spent on running the Foreign and Commonwealth Office.

Do we really think Lady Ashton won't have her toy project up and running on 1 January?  Of course not.  David Cameron's 'protest' is nothing but a cursory gesture.  If he'd said the budget should be frozen for 2011 then people would take notice, but with VAT to rise to 20%, higher utility bills and increasing food costs, I cannot agree that a 2.9% cap is acceptable.  After all that only a 0.9% reduction on the 3.8% increase initially proposed.

There will be a deal, even although her Ladyship has to forego an embassy or two.

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