The February European Council was previously expected to deal with matter regarding trade and foreign affairs, but these issues had to be sidelined to continue negotiations on the Multi Financial Framework (MFF) 2014 to 2020. A special European Summit on the MFF was held in November 2012; however, it ended without any agreement on the budget. The February European Council is therefore seen as the final opportunity to reach an agreement before the European elections which will take place next year.

The November European Council was presented with a Commission proposal to reduce the MFF by €80 billion euro. Despite this large reduction, net payers such as the UK, Denmark, Germany and the Netherlands were not satisfied. They demanded further spending cuts of up to €30 billion, which would reduce the MFF below €1 trillion. In light of this, prior to the February Council Herman Van Rompuy's staff identified areas that could be subject to further cuts saving €15 billion. Areas such as agriculture and cohesion policy would remain untouched. It was hoped this would satisfy the net payers such as the UK and Germany while keeping member states such as France and Poland content.

As the agreement reached on the MFF must be unanimous, negotiations are all about the give and take. But a division among member states had emerged creating North Europe versus South and East Europe. Member states from Northern Europe were pushing for further budgetary cuts but sought to keep their rebates protected. The UK in particular had threatened to block the vote if it was not satisfied with the proposed cuts. Member states from Southern and Eastern Europe were advocating greater public investment and growth to exit the crisis. This highlights the gap between the richer member states and the member states which rely more on EU funding.

After discussions which lasted through the night it was reported a broad framework for the MFF was agreed. This agreement would see cuts to areas such as transport, energy, telecommunication projects and reductions to EU staff benefits. However, the Common Agricultural Policy would remain untouched. If this framework is agreed upon as final it would represent a win of member states of northern Europe as it reduces the budget as much as possible. Circulating figures estimate the budget will be in the region of €960 billion, with actual payments consisting of €908.4 billion. Negotiations are far from being concluded as the European Council must decide in more detail the areas of spending cuts. In addition, the difficult issue of member states' rebates must be dealt with. France is seeking more clarity on the issue, while member states such as Austria are fighting to retain their rebate. At the same time Denmark is pushing for a rebate of its own. Unless a solution to the rebate question is found the current system of rebates will end at the end of 2013. The only remaining rebate would be the UK's.

If the European Council reaches a unanimous agreement on the budget cuts to the MFF there is still along way to go before it is formally adopted. The European Parliament also gets to have its say on the matter. Martin Schulz, the President of the European Parliament, addressed the European Council and reiterated the Parliament's position. The more cuts to the Commission's proposal, the less likely it is that the Parliament will support the MFF. Schulz emphasised the important role the EU budget plays in investment and growth with 94% of the EU budget returning to member states either directly and indirectly such as through investment in foreign policy. Schulz feels that a cut to social areas such as development aid undermines the principle of solidarity on which the EU is built. This is an opinion shared by French President Francois Hollande. He advocated a more modern budget and described the proposed budget of reductions and cuts as backward looking. The European Parliament is therefore unlikely to vote in favour of the deep budgetary cuts proposed by the European Council.