Cutting EU subsidies would be counterproductive, warns Hahn

European Commissioner for Regional Policy Johannes Hahn has appealed to colleagues to “think three times” before slashing subsidies for the European Union’s (EU) weaker economies.The People’s Party (ÖVP) politician said today (Thurs): “The EU’s regional policy measures are an important aspect in creating growth. That’s why it would be counter productive to cut subsidies – especially since individuals are benefiting.”The former Austrian science minister told the Salzburger Nachrichten newspaper: “Why should we punish companies because their governments made a mess? I think it’s the opposite: They (the firms and businessmen) are the backbone of the economies. That’s why I think we have to think three times (before reducing benefit rates).”Speaking about growing anger about the embezzlement of EU subsidies in new member states like Bulgaria and Romania, the commissioner said: “Everyone should mind their own business. I would like to point out that new EU members are extremely interesting markets for countries like Germany and Austria.”Hahn stressed that both countries managed to increase their export rates to many EU members in Eastern Europe by 50 per cent over the past few years.The ÖVP official also said he wanted to reduce his department’s subsidy failure rate further.Hahn dismissed claims that 30 per cent of benefits paid to national governments and companies across the EU were wrongly appropriated. “What matters to me is that the financially relevant failure rate already declined from 11 to five per cent,” he said.Asked whether understood the calls for him to reduce his office’s budget, the commissioner only said: “There are two big departments in the EU – agriculture and regional policies. That’s why these commissions are the first recipients for possible cuts.”