The EU's 27 national governments and the European Parliament agreed Saturday, November 19, to limit spending to 129 billion euros ($174 billion) in the 2012 budget, up two percent from 2011, the Polish EU presidency said.

The agreement - described by Europe's budget commissioner Janusz Lewandowski as an "austerity budget" amid the spiraling debt crisis - defied the preference of the bloc's parliamentarians for bigger spending.

But under-secretary of state for finance Jacek Dominik, who chaired the marathon meeting which started Friday evening, said: "The agreement was reached unanimously."

The limit was imposed by European governments that have been forced to cut their own budgets and impose austerity measures due to the debt crisis.

Lewandowski added that he was "concerned about the risks of not being able to pay all our bills".

The agreement came as a defeat for European Parliament members who had voted on October 26 for a free-spending budget of 133.1 billion euros ($180 billion).

A year ago, a deadline for similar conciliation passed without a deal and left the EU briefly in budget limbo, working off monthly versions of the 2010 figures. The parliament wanted the EU to have over 133 billion euros available to spend in 2012, a 6.6-billion-euro increase on 2011 which amounts to 5.2 percent.

The latest budget talks set the stage for even tougher negotiations on the EU's overall spending priorities for its next seven-year budgetary cycle from 2014 to 2020, AFP reported.