Hungary, Poland veto EU budget over rule of law requirement

File photo of Hungary's Prime Minister Viktor Orban. REUTERS/Bernadett Szabo

Attempts at a compromise on approving the European Union long-term budget have been scuppered after Hungary and Poland blocked the agreement over a mechanism that ties EU funding to rule of law.

The vote on Monday with ambassadors of EU governments on the 1.8 trillion euro package, that included the €1.1 trillion budget and €750 billion coronavirus recovery package, required unanimous support, but the German EU presidency said Poland and Hungary expressed reservations.

However, member states did vote through the link between EU funds and respect of rule of law, which only needed a qualified majority, meaning Hungary and Poland could not block it on their own.

Next steps include a discussion of the veto by EU European affairs ministers on Tuesday, with a video conference with EU leaders on Thursday.

It might take some time to find a solution, however, officials indicated.

• Hungary's Orban threatens to veto EU budget over rule of law conditions

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Austrian Chancellor Sebastian Kurz said it was an absolute necessity to link the distribution of European funds to rule of law standards in member states, especially when the sums to be handed out were so vast.

The nationalist governments in Budapest and Warsaw are against linking EU money and respect for the rule of law because they are under a formal EU process investigating them for undermining the independence of courts, media and non-governmental organisations.

We will not agree to spending 1.8 trillion Euros of European tax payers money if it does not include a binding rule of law mechanism. Independent judiciaries & free media are the foundations of our democracies and our freedom. We will not compromise on that. #MFF #RecoveryFund pic.twitter.com/lEXa0CSsOu

— Manfred Weber (@ManfredWeber) November 17, 2020

 “Poland is counting on a rational approach of our partners and on working out rules which would allow to reach an agreement,” a Polish government spokesman said.

“We are open to constructive solutions, as long as they are in line with the European Council conclusions and EU treaties.”

Without unanimous consent on the 1.8 trillion euro package no EU country will receive any funds, giving Warsaw and Budapest strong leverage to pressure others to remove the link.

“Denying the whole of Europe crisis funding in the worst crisis since decades is irresponsible,” Manfred Weber, who heads EPP group, the largest group in European Parliament, said on Twitter.