Final Remarks

Our reform proposal would imply changes far from a revolutionary upheaval of the system. We have clarified that well-established and functioning elements of the status quo should be retained, such as the contribution-based link between national budgets and the European budget. This feature is particularly helpful in setting up the right incentives to foster fiscal discipline and in constituting a certain counterweight to the common pool problem which is also virulent at the EU level.

With our appeal in favour of a consequential GNI resource-based finance in combination with a generalised correction mechanism and the clear rejection of any new tax-based own resource, our reform proposal appears to be close to the status quo. From the point of view of political acceptability, this is no disadvantage. Nevertheless, the suggested changes would address the main weaknesses of the status quo in that they deal with the distribution issue in a more transparent and explicit way than in the current system. Whereas under the status quo an inflation of special provisions has been necessary to create a politically acceptable burden sharing, our model could reach this objective in a far simpler and more transparent way.