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EU budget: what does the European Union spend and where does the money come from?

How does the EU spend its budget – and who contributes the most?
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Where does the European Union get its money from‚ and how does it spend it?

With an annual budget of over €122bn, the EU is an economic power in its own right, more significant than many countries. So, how do those finances break down? This latest detailed data – from 2010 – shows where the hard cash goes – and where it flows from. As part of our Europa series, we wanted to look at how the figures break down.

Extracted from the EU budget site, we’ve gone for the most detailed recent numbers.

Most of the EU’s money comes from member nation contributions, €108.5bn in 2010. It’s not completely straightforward – especially if you use the UK as an example.

So, this is how it goes:
€14.7bn is the total raised from the UK. This includes money raised in duties within the UK and passed on to the EU. The UK receives a 25% fee of €837.8m for this. Within that…
€12.15bn is the UK’s national contribution, which is largely based on the size of our economy. It also includes other adjustments and €2.63bn from VAT
• -€3.56bn in rebates negotiated by Margaret Thatcher in 1984, called the ‘UK correction’ in the official data. This is paid for by other EU member states

Guardian graphic artist Paul Scruton’s has visualised the key data here:

So, where does the money go? €111bn of it is spent inside the EU – the rest goes on aid and development outside the community. These are the official definitions – and what they really mean.

• Administration Running the EU in each country
• The EU as a global partner International aid, activities outside the EU
Citizenship, freedom, security and justice Asylum, education and culture
Preservation and management of natural resources Common agricultural policy, environment, fishing
Cohesion for growth and employment Helping poorer regions of Europe
Competitiveness for growth and employment Economic growth grants to small business, science and research

Germany, as the biggest economy, is also the biggest contributor, Poland is the biggest receiver. The UK contributes much more than it receives too, about €5.4bn more. Why the gap? The UK is a rich country and the EU points out that although it spends less in the UK than the national contribution, the British economy gains much more from access to European markets and contracts. UK exports to the EU were worth £13.9bn (€16.6bn) in November last year alone.

The biggest item of spending is the Common Agricultural Policy – which incorporates rural development and a small amount on fisheries. The EU points out that this is now frozen and will be overtaken by the ‘economic growth’ category – but at the moment it accounts for €55.1bn. The big spending is in countries like France, Spain and Ireland, especially if you look at the figures as € per person.

How much does each country give and receive per person? If you look at national contributions from and spending in each country in, Luxembourg is the biggest receiver in Europe. However, those figures are skewed by its tiny population of 502,000 people and the fact that it is home to several EU institutions, including the European Court of Justice, the European Court of Auditors, Eurostat and the Secretariat of the European Parliament.

This is just a skim through the data. You can download the full spreadsheet below or download the graphic as a PDF. What can you do with it?

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