EU Parliament approves first budget cut

The European Parliament has finally approved a seven-year budget that is the first spending cut during the history of the 28-nation bloc.

On Tuesday, the EU legislature approved a 960-billion-euro ($1.3 trillion) budget for the 2014-2020 period, down from an original proposal of 1.047 trillion euros in June 2011.

Several EU governments, which expected austerity measures to be applied for all EU nations, were seriously pursuing the cut.

EU President Herman Van Rompuy called the approved financial plan “a realistic budget for Europe” which has plunged into financial crisis in recent years.

“The difficult budgetary situation in the member states has resulted for the first time in a lower budget,” said Jean-Luc Dehaene, the parliament’s chief negotiator, adding that difficult times are ahead.

“This is especially problematic as in times of national austerity the EU budget should be higher to compensate for declining investments in the member states,” he said.

The Parliament meeting, which was held in the eastern French city of Strasbourg, approved the budget by a vote of 537 to 126, with 19 abstentions.

Britain was among the countries satisfied with the budget.

“When governments and families across Europe are taking difficult decisions to make savings, it would be wrong and irresponsible for the EU to not show similar restraint,” said Nicky Morgan, a British treasury minister.

Europe plunged into financial crisis in early 2008. Insolvency now threatens heavily debt-ridden countries such as Greece, Portugal, Italy, Ireland, and Spain.

The worsening debt crisis has forced EU governments to adopt harsh austerity measures and tough economic reforms, which have triggered incidents of social unrest and massive protests in many European countries.