EU Plans to Save Money on Defence
The current drafts for the next EU budget radically cut back funding for the European Defence Fund and military mobility. This threatens both the European Union’s ability to act globally as well as its credibility.
In Brussels, negotiations on the European Union budget for the period 2021 to 2027 are just about to enter the hot phase. This is about more than just a list of revenue and expenditure. The so-called Multi-Annual Financial Framework (MFF) defines important pillars of the EU for the next seven years: its tasks and priorities, the European Commission’s power to shape the budget and the financial pecking order among the Member States. It is the yardstick for what will be possible; and that, it currently seems, is little, at least in the area of security and defence.
Under former President Jean-Claude Juncker, this had been declared one of the priorities of the European Commission, in keeping with the EU’s self-acclaimed goal of striving for “strategic autonomy”. With this prioritisation, Juncker and his successor Ursula von der Leyen responded to the need to counteract the crises and conflicts in Europe’s neighbourhood and to the support of EU citizens for a more common foreign and security policy, as repeatedly expressed in the Eurobarometer surveys.
The flagship projects of the increased efforts towards a defence union should include, in particular, the European Defence Fund (EDF) and an initiative to promote military mobility in Europe. Yet both projects are being radically fleeced in the currently circulating draft budgets. Instead of the EUR 13 billion originally proposed by the Commission, only EUR 7 billion is proposed for the defence fund, and only EUR 1.5 billion instead of the original EUR 6 billion for military mobility. As Politico’s Paul Taylor puts it: “The EU is about to give birth to a mouse”.
The cuts were first proposed by the Finnish Presidency and then presented in slightly modified form by the President of the European Council, Charles Michel. Even though there is no agreement in the European Council so far, there is little to suggest that these two budget items will be increased.
The European Defence Fund was established by the Commission in 2017 and is intended to encourage Member States to jointly research and develop innovative armaments projects by providing financial support from the EU budget. The Fund’s projects include the development of the “Eurodrone“, an unmanned military air reconnaissance vehicle – an important building block for achieving the goal of strategic autonomy.
With additional money for military mobility, the European Commission is pursuing the goal of promoting civil infrastructure projects in the Member States, which at the same time facilitate the deployment of military equipment on Union territory. Examples include bridges that can also be crossed by heavy armoured vehicles, or low-floor railway wagons that enable rapid transport. Since the annexation of Crimea by Russia and the resulting need to reinforce NATO’s eastern flank, considerable bottlenecks have become apparent here. These will probably become apparent again in the coming weeks, when NATO moves a large military unit to Eastern Europe as part of the Defender Europe 20 manoeuvre.
The budget for the European Defence Fund is also a major concern for the French, who are committed to a greater communitarisation of defence policy. Accordingly, Nathalie Loiseau (Renew Europe), MEP and Chair of the Defence Subcommittee, expressed her disappointment: “We must give ourselves the means to strengthen European defence”. The draft budget “falls far short of our expectations”.
In contrast, investments in militarily usable infrastructure are particularly important for Central and Eastern European member states. They fear that their American and Western European allies would otherwise not be able to move their military units east quickly enough.
But even if the Member States define their priorities differently, it must be noted that the draft budgets at hand do not meet European demands in defence policy as a whole. There are four main reasons for this.
Firstly, there is a general compulsion to economise. This results from the departure of the United Kingdom, the third largest contributor to date, and the efforts of some other Member States (Sweden, Denmark, the Netherlands and Austria) to pay no more than 1% of their gross domestic product in EU contributions.
Secondly, it is still difficult to assess who will benefit from the European Defence Fund. Many observers in Brussels see the Fund primarily as a French attempt to push ahead with the communitarisation of European defence policy. However, the Central and Eastern European members in particular are reluctant to both communitarisation and possible French dominance in this area.
Thirdly, it appears that some of the southern and western Member States still do not share the threat perception of their Baltic and eastern European partners with regards to Russia. This is the only possible explanation for the low priority given to the issue of military mobility in the draft budget.
Fourthly, some Member States may also have considered that their contributions to the European Defence Fund and military mobility are not part of their national defence expenditure. Consequently, they would not help them to move closer to NATO’s internal goal of investing 2% of GDP in their own armed forces. However, it is precisely this statistic that is currently important to many NATO member states in order to demonstrate their solidarity with their own allies.
The result is a seven-year budget, which does not reflect the European Commission’s priorities in the field of security and defence policy, but does reflect the continuing lack of a common threat perception. This does not necessarily mean that the necessary investment in national armed forces and militarily usable infrastructure will not be forthcoming. The Member States can still invest the money saved in the European budget themselves and even work together.
However, the European Commission has a coordinating rather than a controlling role in this process. With such a limited budget, it will not be able to provide the necessary incentives to develop the key capabilities needed at European level. In addition to this very practical consequence, the reduction of two flagship projects also threatens to further damage the EU’s credibility as a global player and its claim to strategic autonomy.
Head of the FNF Security Hub in Brussels.