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Wednesday, May 02, 2007

pie charts and pork pies

The Commission have put out a press release trying to make a big deal out of their planned 2008 budget.

For the first time, spending on growth and employment policies will represent the highest share of the budget, ahead of agriculture and natural resources. This is the key message sent by the Commission in its budget proposals for 2008, adopted today.

If you still aren't convinced, there's even a pie chart showing that competitiveness now accounts for 44.2% of the budget (the 43.6% on farm spending is sliced in two to look smaller).

However, there are a number of small problems. One quibble is that the part of the so called "structural funds" budget (which sounds like it should be all about building roads) go on agriculture and fishing spending anyway. This 'hidden' agiculture spending appears to be increasing - it was up from 2.5% of the budget in 2002 to 4.2% in 2005, neatly tipping the balance from green to blue above. It will be interesting to see what has happened to it when the detail of the new 2008 budget comes out. Its also worth remembering that the total agricultural spend has gone up from €40.6 billion in 1997 to €56.3 billion now - so it's not like the spending has been slashed.

Secondly, and more importantly, does the budget for spending on "employment and growth" actually create employment and growth? Quite apart from the general question about whether what Europe needs now is yet more government spending, the EU's budget for "competitiveness and cohesion" is really just a rebranded way of talking about the old "structural" and "social" funds.

Is this money well spent? In the UK ,for example, it funds projects like designs for a plan to turn Barnsley into a "Tuscan Hill Village", or create a giant lake in the middle of Bradford. Elsewhere it leaves a slew of barely used motorways to remote areas, while in the richer member states it seems to lead to the building of a lot of community centres. Part of it goes on the ludicrous "interreg" programme which provides local councillors with nice jollies to other member states and things like the trans-manche assembly.

Is spending our money on this sort of thing rather than - say - cutting tax in deprived areas, really going to help us compete with China? The UK will be paying an average of £10.2 billion a year into the EU over the 2007-13 financial perspective. Imagine what you could do with the money...

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