John Bachtler: Agreement will come eventually, but the picture outside Brussels remains bleak

THE failure of a European Council summit on the EU budget is not new. We have been here before in 1998 and 2005 – the last two occasions when the seven-year EU budget was negotiated, and when it took two rounds of negotiation for leaders to reach agreement.

The arguments seem wearyingly familiar: the British want budget cuts (as do the Danes, Dutch and Swedes) and protection of their rebate; the French want to keep agricultural subsidies; the Poles, Spaniards and others want to retain structural and cohesion funds; the Germans want to broker a compromise while avoiding paying more.

Agreement, though, will have to come. Following the predicted script, there will be another European Council early in 2013. Meanwhile, the council president, Herman Van Rompuy, and the European Commission president, Jose-Manuel Barroso, working with the incoming Irish EU presidency, will conduct an intensive round of diplomacy to find common ground. A compromise budget deal will be reached.

The immediate political reaction to this summit’s failure is significant. So far, there has been less of the grandstanding of the past. The talk is more emollient, with references to progress and a convergence of views. Indeed, the architecture of a possible deal, which involves real cuts, is already on the table. Angela Merkel is playing a crucial role: keen to avoid David Cameron being isolated, she has deftly sought to build bridges. This will change over the coming days, as leaders seek to present themselves in the best possible light, apportion blame and start the political positioning for the next summit.

Beyond the conference room, the picture is bleaker. At a time of austerity and unresolved problems in the eurozone, people will see yet again an EU leadership that is unable to agree a budget and articulate a positive policy message on what the EU can do to help stimulate growth and create jobs. And the UK’s position will have done nothing to dispel the belief in European political circles that it is on the way out of the EU.

•  Professor John Bachtler is a director of the European Policies Research Centre at the University of Strathclyde.