The EU is in the process of negotiating its 2014-20 financial framework. Failureto reach an agreement would imply a delay in the preparation of the strategicplans each member state puts together to explain how it will use Structural andCohesion Funds. Even if solutions are found \u2013 for example annual renewals of the budget based on the previous year's figures \u2013 there will be political and ins-titutional costs. EU leaders have too often and too forcefully advocated the useof the EU budget for growth to be able to drop the idea without consequences.\u2022The overwhelming attention paid to the size of the budget is misplaced. EU lea-ders should instead aim to make the EU budget more flexible, safeguard it fromfuture political power struggles, and reinforce assessment of the impact of EU-funded growth policies.\u2022To improve flexibility a commitment device should be created that places theEU budget above continuous political disagreement. We suggest the creation of a European Growth Fund, on the basis of which the European Commissionshould be allowed to borrow on capital markets to anticipate pre-allocated EUexpenditure, such as Structural and Cohesion Funds. Markets would thus be afactor in EU budget policymaking, with a potentially disciplining effect. Atta-ching conditionality to this type of disbursement appears legitimate, as capitaldelivered in this way is a form of assistance
