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EU diplomats have been ordered to scrap travel plans, cancel parties and postpone work to secure residences after significantly overshooting their budget this year, denting the ambition of the union’s foreign policy arm.
The EU’s external action service, in effect the bloc’s foreign ministry, has been told to cut €43mn — almost 5 per cent of its planned budget — after breaching agreed spending limits, said five officials briefed on the demand.
Officials say the financial squeeze will worsen next year, making it impossible to maintain the EU’s existing diplomatic footprint in areas such as Africa and Latin America with high fixed costs and inflation pressures.
The diplomatic service has acknowledged the proposed budget will require “severe austerity measures”, compelling it to sell property to balance the books. One official said it may also need to close missions.
A clampdown on expenses has already been felt across the network, with cuts to everything from chauffeur driven cars to stationery. “We can no longer host and do outreach events,” complained another official.
The annual EEAS reception at the UN General Assembly, which diplomats said was vital for persuading developing countries to side with the EU on issues such as the war in Ukraine, has been axed. EEAS is in “dire straits”, a second EU official said, adding “the world needs more diplomacy, not less”.
A spokesperson for the EEAS said it had cut “all the expenditure we possibly could”, and halved budgets of overseas offices “despite the crippling effects on our global outreach”.
By contrast the European Commission, the bloc’s executive arm that oversees the EU’s common budget, still has money to spend. “Commission staff can travel around the country but not the EU ambassador as they are on the EEAS budget,” said the first EU official.
About 50 of the EEAS’s 145 overseas delegations — essentially EU embassies — have critical security concerns. But there is no money to upgrade locks, bar windows or install cameras. “It’s a duty of care issue for staff,” the official added.
Running repairs are also impossible. Some residences are uninhabitable but cannot be fixed up, with the ambassadors paying rent to live elsewhere while their residences are unoccupied.
A decision taken this week by the EU’s chief diplomat Josep Borrell to organise the traditional twice-yearly informal meeting of foreign ministers in Brussels, instead of allowing Hungary to host it in Budapest as originally planned, means the cost of that event will also fall on the EEAS budget, a second official said.
Just the translation costs for that gathering run past €70,000, they said.
“It is a big hole that we now have to fill,” said a third official.
Commission president Ursula von der Leyen has called for the EU to raise its game in international affairs. “In a world as dangerous as it has been for generations, Europe needs to be more assertive in pursuing its strategic interests,” she said in her manifesto for a second term.
EEAS secretary-general Stefano Sannino in March warned the agency was “heavily under-budgeted”. His annual report to the European parliament said a 7.1 per cent increase in the administration budget to €880.2mn failed to match inflation.
“This increase is historically high, but nevertheless represents a significant reduction of the institution’s purchasing power in an environment characterised by high inflation worldwide, a weak euro exchange rate and the restrictive budgetary environment” of the commission, he wrote.
All EU departments must keep annual rises in non-salary expenditure within 2 per cent, under the rules of the current seven-year budget overseen by the commission. The EEAS overspend was the largest in absolute terms, officials said, and resulted in the order to cut spending by €43.6mn.
The commission has proposed the same cap for 2025, which would force even more drastic action next year, a fourth official said.
The EU has 145 delegations worldwide including in Barbados, Cabo Verde and the Vatican.
Additional reporting by Paola Tamma in Brussels
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