2015 EU BUDGET TALKS GO TO CONCILIATION

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2015 EU BUDGET TALKS GO TO CONCILIATION
22 Oct 2014

2015 EU BUDGET TALKS GO TO CONCILIATION

Brussels Daily

The Council today informed the European Parliament that it cannot approve all the amendments of the European Parliament for the 2015 EU budget. This means that on 28 October a three-week conciliation period will start, aimed at bridging the gap between the Council’s and the European Parliament’s position.

2015 is the second annual budget under the EU’s multiannual financial framework (MFF) for 2014-2020 and has a double purpose: to help launching new spending programmes and to finance the completion of measures kicked off under the previous programming period 2007-2013.

Conciliation on the 2015 EU budget takes place at a moment of continued member states’ efforts to consolidate their public finances in order to put their national budgets on a sustainable basis; at the same time, the overall economic situation remains fragile.

The Council therefore considers that the 2015 EU budget should ensure adequate budgetary means to foster growth and jobs, while respecting member states’ financing capacities. In line with the principle of budgetary prudence the Council also attaches much importance to leaving sufficient margins under the ceilings of the multiannual financial framework in order to allow the EU to react rapidly to unforeseen events.

The Council’s position, adopted on 2 September by an overwhelming majority of member states, meets these objectives: it increases payments for activities such as research, innovation and education by 24.5 % or 2.8 billion € compared to the 2014 EU budget as adopted; it limits the total level of payments to 140.00 billion € (+3.3% compared to 2014[1]) and of commitments to 145.08 billion € (+1.7%); and it keeps sufficient margins under the ceilings for both payments and commitments.

The European Parliament asks to increase total payments to 146.42 billion € (+8.1% compared to 2014) and total commitments to 146.35 billion € (+2.6%).

 

The Commission proposed 142.14 billion € in payments (+ 4.9% compared to 2014) and 145.60 billion € in commitments (+ 2.1%).

Conciliation will also cover:

  • Amending letter no 1 for 2015 (14401/14) which updates the draft budget proposed by the Commission for 2015 notably with regard to agricultural expenditure, reducing the overall commitments by 448.5 million € and redeploying payments of 397.0 million € from heading 2 (Sustainable growth: natural resources) to meet needs under other headings.
  • Draft amending budget no 2 for 2014 (9017/14) which seeks to incorporate the budget surplus of 2013 of 1.0 billion € into the 2014 budget. The Council approved this draft amending budget on 14 July 2014. The European Parliament adopted an amendment, asking to put last year’s budget surplus into a new reserve aimed at covering additional payment needs in 2014. The Council today informed the European Parliament that it cannot approve this amendment. This will open a formal conciliation on this draft amending budget in parallel to the negotiations on the 2015 budget.

In addition, the following issues are still outstanding:

  • Draft amending budget no 3 for 2014 (10340/14), aimed at increasing the payments in the 2014 EU budget by 4.7 billion € in order to cover outstanding bills. This additional amount would be financed by using the margin below the 2014 MFF payment ceiling and mobilising the contingency margin of 4.0 billion €. The use of the contingency margin in 2014 would be offset by reducing the amounts available under the MFF payment ceilings by around 1.3 billion € in each of the years 2018, 2019 and 2020. Moreover, it reduces the commitments by 0.4 million € resulting from changes to the establishment plans of some institutions. Draft amending budget 3/2014 also increases the forecast of other revenue, stemming mainly from fines, by 1.6 billion €. The Council is currently examining this draft amending budget.
  • Draft amending budget no 4 for 2014 (11775/14) as amended by a letter of amendment (14403/14). It seeks in particular to incorporate additional revenue amounting to 2.4 billion € mainly from fines. The Council could accept this draft amending budget.
  • Draft amending budget no 5 for 2014 (12954/14), aimed at mobilising 47.0 million € in commitments and payments out of the EU solidarity fund in order to remediate damages caused by floods in Italy (16.3 million €), an earthquake in Greece (3.7 million €), as well as ice storms in Slovenia (18.4 million €) and Croatia (8.6 million €). The Council is currently examining this draft amending budget.
  • Draft amending budget no 6 for 2014 (14442/14), which seeks to revise the forecast of the EU revenue, decreasing member states’ contributions to the EU budget by 419.9 million €. It also covers the expenditure side, reducing commitments by 76.2 million € and increasing payments by 0.1 million €. The Council is currently examining this draft amending budget.
  • Draft amending budget no 7 for 2014 (14444/14), designed to mobilise 79.7 million € in commitments and payments out of the EU solidarity fund to remediate damages caused by floods in Serbia (60.2 million €), Bulgaria (10.5 million €) and Croatia (9.0 million €). The Council is currently examining this draft amending budget.


If conciliation does not succeed by 17 November, the Commission must submit a new draft budget for 2015.

Background

The Conciliation Committee is composed of the 28 members of the Council and an equal number of members of the European Parliament. The Commission takes part in the Conciliation Committee’s proceedings. It will meet on 6 and 14 November, the meeting on the latter date being prepared by the ECOFIN-Budget Council taking place on the same day. Trilogue discussions between the Italian presidency and representatives of the European Parliament and the Commission will take place on 11 November. The conciliation period ends on 17 November.

If the conciliation succeeds, the Council and the European Parliament have 14 days to formally adopt the agreement, following the finalisation of the joint text (see flow-chart on the last page). The budget is adopted unless the Council or the European Parliament rejects it.[2] If the conciliation fails, the Commission must submit a new draft budget.

Should the budget not be adopted at the beginning of 2015, a sum equivalent to not more than one twelfth of the budget appropriations for 2014 or of the draft budget proposed by the Commission, whichever is smaller, may be spent each month for each chapter of the budget, in line with article 315 of the Treaty on the Functioning of the EU.

[1]           The 2014 EU budget as adopted last year includes 135.50 billion € in payments and 142.64 billion € in commitments.

[2]           The only exception is the (rather theoretical) case where the Council rejects the text. In this case, the European Parliament may adopt the budget by confirming its amendments by a majority of its members and three-fifths of the votes cast.

 

Read Press release in full ST 14586/14 Brussels, 22 October 2014
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