Duitsland in conflict met Brussel over EU-budget (en)

The rhetoric between Brussels and the biggest EU member state intensified over the weekend after the Commission warned that aid to former eastern Germany would be stopped if Berlin got its way on cutting the EU budget.

Referring to calls by Germany to cap the next budget at 1 percent of the EU's gross national income, Budget Commissioner Michaela Schreyer said there would be "too little money to keep supporting East Germany".

"If we cap EU spending at an average of 1 percent of EU gross national income as [Finance Minister] Eichel suggests, East Germany may not get any structural development aid from 2007", said the Commissioner in an interview with FT Deutschland.

"With a 1 percent scenario, there would simply be too little money there to continue to support east Germany", said Ms Schreyer.

Her comments come just before the Brussels executive is due on Wednesday to unveil plans for its regional programme for the next financial period - 2007-2013.

The regional spending is likely to be where the fiercest battles in the next EU budget round are fought as the Commission is proposing to raise spending from 39bn euro in 2006 to 51bn euro in 2013.

Provocative

The German finance ministry has already branded Ms Schreyer's comments as "provocative".

Mr Eichel repeated his view to Die Welt am Sonntag that the Commission cannot force the country to save money on the one hand (due to the euro rules) and, on the other hand, want additional billions from it.

Currently, Germany pays in 22 billion a year and that would rise to 33 billion a year if the budget was capped at 1 percent of GNI because of EU enlargement. "The European Commission would even like over 40 billion euro from Germany. That we cannot and will not accept", said Mr Eichel.

On 10 February, the Commission unveiled its plans for the next budget calling for large increases over the seven year period from 2007 to 2013 - despite calls from Germany and five other member states to cap the budget.