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From Punctuated Equilibrium towards Political Cycles? Contestation, Politicization and Change in EU Budgeting (Abstract only)

Abstract submitted to the ICPP Conference, Milan 2015

From Punctuated Equilibrium towards Political Cycles? Contestation, Politicization and Change in EU Budgeting

Klaus H. Goetz and Ronny Patz

Recent studies on the evolution of the EU budget suggest that punctuated equilibrium models best explain stability and change in EU budgeting over time. Successive enlargements towards new member states and the negotiations preceding the adoption of multiannual financial frameworks (MFFs) of the EU, which cover a seven-year period, herald important substantive budgetary change. Considered against this background, the EU’ annual budget procedure should be expected to act as stabilizing device that underpins a general tendency towards incremental adaptation and orientation towards the status quo. Several mechanisms are supporting this orientation towards the status quo: The chief procedural rules of the annual procedures are enshrined at the level of EU treaties, elaborate administrative budgeting routines have developed and any substantive decisions made during the annual procedure need to respect the parameters set by the septennial MFF.
Recent developments in EU budget procedures suggest that this traditional sequence of punctuated change followed by stability promoted by annual routine procedures is coming under heavy pressure from at least two fronts. First, contestation surrounding the annual budget procedure has increased markedly, to the extent that it has threatened to derail the annual procedure. The chief reason is that spending by the EU, which is mainly financed through member-state contributions, is viewed ever more critically in many European capitals. Continuous rather than episodic contestation over the budget raises the possibility of a more continuous pattern of gradualist change. Second, there is growing politicization, which points towards the emergence of budget cycles that follow the mandates of the Commission and the European Parliament. The new European Commission, which came into power in late autumn of 2014, defines its role in political rather than administrative terms. At the same time, the European Parliament, whose five-year term coincides with the Commission, has assumed a more assertive stance in the annual procedure, as the repeated failure of conciliation underlines, and has requested a synchronization of the plurannual budget cycles to electoral cycles. Politicization, driven by both the Commission and the European Parliament, has been most visibly expressed in the 315 bn € “Investment Plan” proposed in November 2014, outside the traditional MFF cycle. This plan, which foresees leveraging public and private money at twice the amount of the Union’s annual budget, indicates that increased politicization may lead to a political budget cycle tied to the mandates of the Commission and the European Parliament. To better understand these new dynamics of EU budgeting, this paper will trace the evolution of contestation and politicization around EU budget procedures as factors impacting the sequence of change and stability and assess their implications for how the budgeting procedures operate.