Brexit has thrown financial planning into the turmoil with Britain’s departure leaving an annual hole of about €12 billion in the EU’s coffers and richer nations fear being strong-armed into making up the shortfall. It leaves Mr Michel facing a stand-off between members states that want to keep their contribution to the EU’s coffers broadly at current levels despite Brexit and those who think the bloc needs to invest much more.
At least 18 individual meeting with EU leaders were scheduled this week which Mr Michel called in the hope of trying to forge a compromise between the opposing factions.
A “frugal group” of four net-payers led by Dutch Prime Minister Mark Rutte insists the new fiscal plan, especially given Britain’s departure, should remain stable at 1 percent of the bloc’s gross national income (GNI).
But the Friends of Cohesion group – about 16 southern and eastern net recipients of EU budget funds — wants its wealthier neighbours to boost investment in agriculture in regional development.
Many of them are pushing for a seven-year budget of €1.135 trillion which stacks up at 1.11 percent of the EU’s GNI.
Germany and France, who will be responsible for a projected 42 percent of the overall national contributions under the European Commission’s budget proposal, are trying to distance themselves from the spat although Angela Merkel has called for a 1 percent budget cap while Emmanuel Macron wants to splash the cash.
EU chiefs hate members being labelled net payers and net recipients and insist everyone benefit from the bloc’s budget but the cohesion and frugal camps are both digging their heels in.
Portuguese Prime Minister António Costa, who has taken on a leading role within the Friends of Cohesion, said: “We want a budget that is equal to European ambition and that allows us to respond to the legitimate expectations of citizens.
READ MORE: EU official bangs fist with rage as budget slashed due to Brexit
Other senior EU figures remain unconvinced despite the marathon session of head-to-heads in Mr Michel’s office over the last few days.
Mr Rutte said: “I am not sure we will get to a deal in that weekend — or on the 20th or the 21st or that weekend.
“But the way that he is conducting it, the way he is trying to pressure people in a pleasant but very forceful and thoughtful way, is exactly what I hoped to have from a liberal president of the European Council.”
Swedish Prime Minister Stefan Löfven said: “I think in general that the countries are too far away at the moment.”