^aSchool for Politics and International Studies, University of Leeds, Leeds LS2 9JT, UK. E-mail: N.Robinson@leeds.ac.uk

Abstract

This article challenges the view that the EU is increasingly compromised in its ability to deliver expenditure policy, arguing that the existing literature contains several fundamental flaws. First, that literature focuses predominantly on the headline conflict over the budget — but to do so underestimates the full effect of EU activity, because the additionality and matched funding principles hugely increase the impact of the budget on expenditure. Second, it challenges the view that the EU (and in particular, EMU, due to the stability pact framework) imposes pressure to reduce national spending. Third, it argues that other EU objectives impact on expenditure policy, actually causing pressures which increase national spending: the most obvious example is EU accession, but similar effects can also be seen in areas such as growth in foreign direct investment. Finally, studies of the EU totally ignore the impact of the European Investment Bank, which is the world's largest multilateral lending institution. The cumulative effect of this EU activity is to facilitate over 250bn of spending per annum. Thus, we need to reconsider the role of EU expenditure, for without doing so we will continue both to misunderstand the EU policy process, and fail to adequately theorize the process of EU integration.