The European Union Budget as an Indicator of Changes in EU Policies

Abstract

The focus of this paper is on the EU budget and the changes in European policies. The basic objective of the paper is to assess how the political priorities of the European Union are reflected in the EU budget, mainly on the expenditure side. Questions about the purpose of the budget and the principles that govern the use of public finances in the Union are linked to wider questions about the nature of the EU and its evolution. The paper contributes to the theoretical debates on European policy and public finances, but also provides policy insights on the relationship between the EU policy process and the budget. The development of budgetary expenditures follows the development of EU policies. Hence this paper detects the interrelationships among the policies of the Union; all policy areas interact with one another, which is particularly visible in EU budget. Many areas of EU policy are regulatory in nature and have few requirements for spending, except for administration. The EU has a significant responsibility in relation to only one area important to public expenditure: economic affairs. However, EU spending programmes pursue a multiplicity of grand objectives, often unrelated to the available funding. The relatively small size of the EU budget makes the EU’s rules (the regulatory sphere) matter more than the EU’s expenditures in attaining political priorities.