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EU has no cash for Erasmus student fund

02 October 2012, 21:17 CET
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(BRUSSELS) - The EU's Erasmus student exchange programme along with various social welfare schemes are nearly broke after cuts made to the 2012 budget by austerity-driven member states, a top lawmaker said Tuesday.

French conservative member of the European Parliament, Alain Lamassoure, who heads the budget committee, said that "the European social fund is bankrupt and can't refund member states.

"Next week it will be Erasmus, the student programme, at the end of the month, the Research and Innovation Fund."

Speaking at a news conference, Lamassoure blamed the shortfall on governments that fought for a four-billion-euro cut in the EU budget, in line with austerity policies across the 27-nation bloc.

Budget Commissioner Janusz Lewandowski is due to ask member states for "several billion" extra in the coming weeks to plug a deficit Lamassoure estimated at 10 billion euros.

Failing new contributions, the EU executive would be unable to reimburse monies owed to different member states, said Lamassoure.

He estimated that the losses could amount to 400 million euros for France, 600 million euros for Greece, 900 million euros for Spain and up to 200 million euros for Britain.

"These countries have a right to these monies which are reimbursements. It isn't lost but they will have to wait to recover it," he said.

Britain, which led efforts to trim the 2012 EU budget, was shooting itself in the foot, he added, denouncing what he termed "an absurd situation."

The situation, however, is unlikely to change given that seven nations -- Austria, Britain, France, Germany, Finland, The Netherlands and Sweden -- have refused to sign on to European Commission proposals to increase expenditure in the 2013 budget by 6.8 percent, or nine billion euros, to 138 billion euros.

The seven are net contributors to the budget, meaning that they contribute more than they receive from the EU.

Finland, France and Germany have called for a five-billion-euro cut in 2013 spending, including 3.5 billion euros that were destined for spending on economic growth, jobs and competition policies.

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