France says countries could move ahead on EU budget without Poland, Hungary

PARIS (Reuters) - European leaders could push ahead with a post-coronavirus recovery fund and European Union budget without Hungary and Poland as a last resort should they continue to block the adoption of the bloc's long-term budget, a French official said on Wednesday.

Hungary and Poland blocked the adoption of the 2021-2027 budget and recovery fund at a meeting of ambassadors of EU nations on Monday, over a clause making access to money conditional on respect for the rule of law.

The nationalist governments in Budapest and Warsaw oppose linking EU money and respect for the rule of law as they face a formal EU investigation over undermining the independence of courts, media and non-government bodies.

French officials say they are still trying to persuade Poland and Hungary to lift their veto and unblock the adoption of the 750 billion euro (£670 billion) recovery package and the 1.1 trillion euro budget ahead of Thursday's summit of EU leaders.

"If this doesn't work, and we're not there yet, the possibility of resorting to a deal without all 27 countries is one of the options on the table," the adviser to President Emmanuel Macron said, speaking on background.

One solution could be to use a so-called "enhanced cooperation" procedure whereby some EU countries can decide to move ahead with a particular policy on their own.

That would mean Poland and Hungary would lose access to tens of billions of euros in EU funds.

Earlier on Wednesday, France's Europe minister, Clement Beaune, told senators Paris would not give up on linking EU funds to respect for the rule of law.

"We will look, if we need to, as a last resort, how to move ahead without the countries blocking. Because Europe can't be held hostage by a certain number of countries which don't want to respect the essential foundations of our political project."

(Reporting by Michel Rose; editing by Jonathan Oatis)