Across the EU, citizens in every member state are feeling the impact of the ongoing financial crisis. Unemployment is rising throughout the continent - with almost a quarter of Spaniards, for example, currently out of work.

Figures for youth unemployment are considerably higher. The much hoped for signs of recovery in the private sector remain elusive in many countries. The UK has slipped back into recession - the first double dip recession since the 1970s - and the Tory/LibDem Coalition government's continued failure to make meaningful capital investments is truly beginning to bite.

It's against this dismal background that the European Commission made their proposals for the EU's 2013 budget. And whilst governments, councils and public agencies the length and breadth of Europe are forced to operate within ever tightening means, the Commission appears to be impervious to economic reality. An increase from €129bn to €138bn - an inflation-busting 6.8% - shows a Commission apparently still failing to face reality.

The Commission's budget proposals are unrealistic, unworkable and downright insensitive in the current economic climate. The EU's institutions simply cannot stand alone amongst public bodies and consider themselves exempt from budgetary restraint. When cuts across Europe are affecting real jobs, real services and real lives the Commission must look to ways to make their own savings. A starting point might be to rethink the wasteful ITER nuclear fusion project whose budget overrun is costing €1.3bn in 2012-13 alone.

Within the current budgetary constraints the EU must work together with governments and bodies within the member states to promote jobs and growth. The EU has an important role to play in that but, if national budgets are diminishing, then so too must the EU's. The European institutions must work in parallel with national bodies - and not compete with them for a smaller pot of money.
The Scottish government sets a good example, with 36 "shovel ready" capital projects worth more than £300 million. These could provide vital jobs - an estimated 1,400 posts for every £100 million invested. Unfortunately, a UK government more intent on giving tax breaks to the rich has failed to deliver the money. A Scottish government with normal fiscal powers, which Independence would guarantee, could change the funding priorities to ensure this type of investment goes ahead.

Such investment would nonetheless require a degree of cooperation from the EU institutions - at least to the extent of not requiring the member states and taxpayers of Europe to pay ever increasing, inflation-busting sums to the Union. Scotland's share of that ITER money mentioned above would undoubtedly be welcome for capital investment closer to home.

The Commission's proposals are, of course, merely their opening gambit. The negotiations will, as ever, be long and drawn out and the final result is a some way off. As an opening gambit however, it is wrong and betrays an attitude out of touch with reality. For the sake of the EU, its member states and its 500 million citizens, the Commission must seriously reassess its position.

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