EU 'crisis' after summit failure
Budget talks collapse
BRUSSELS, Belgium (CNN) -- The two-day European Union summit has ended in failure, with its president stating, "Europe is not in a state of crisis -- it's in a state of profound crisis."
Luxembourg Prime Minister Jean-Claude Juncker, who holds the rotating EU presidency and tried to broker a budget compromise, said on Friday, "I have to say my enthusiasm for Europe has suffered a severe setback today."
British officials rejected a budget plan for the years 2007-2013 because they said it did not contain sufficient guarantees that the EU's system of agricultural subsidies would be overhauled, in return for Britain agreeing to freeze a rebate it receives in compensation for its outsized net contribution to the EU.
The budget requires approval of all 25 EU member states, so it cannot go into force with Britain's approval.
"We simply weren't able to bring people together sufficiently to get an agreement," said Jose Manual Barroso, the president of the European Commission, the EU's executive arm.
"We are saddened. We are concerned. But I'm sure it's not the first time we've found ourselves in difficulty. I'm sure we'll come up with some solution."
It was the first summit of EU leaders since voters in France and the Netherlands rejected its proposed constitution two weeks ago.
The "No" votes were seen as a profound blow to European integration.
Juncker accused some leaders of "seeking failure" by pushing for fundamental changes they knew weren't possible.
"The differences were very small. For some delegations, who shall remain nameless, there wasn't the political will to reach an agreement," he said.
Juncker also said he was "sad and, to a certain extent, ashamed" that the new, poorer EU members were willing to make concessions in the budget while wealthier members were not.
Juncker pointedly said he had no advice to offer Blair on the way forward "because people are obviously not interested in my advice."
With the budget still unresolved, the task of finding an acceptable compromise will fall to the next EU president -- the man who turned down Juncker's proposal, British Prime Minister Tony Blair.
He takes the EU helm July 1.
Former Prime Minister Margaret Thatcher won Britain's EU rebate in the 1980s, arguing that part of the money her country paid into the EU's coffers should be refunded.
She argued that Britain received fewer benefits than other large countries, particularly France, which reaps more agricultural subsidies.
Blair has said he is only willing to discuss changing the rebate as part of a more in-depth overhaul of EU finances, including its common agricultural policy.
British officials have said it eats up too much of the EU's budget.
CNN European political editor Robin Oakley contributed to this report.
