European Council cut 2,1 billion Euros for next annual financial cycle. Countries don't want to pay the 2015 budget, and amending proposals for 2014 are on the table as well
by Emanuele Bonini
Once again the European Union is divided over financial questions. Annual or multi-annual financial framework it doesn't make any difference: the EU member States have argue and complain. For 2015 the European Council - the European institution composed by the government of the member States - have decided to reduce the total amount of payments. The European Commission proposed 145,6 billion Euros in commitments and 142,1 billion in payments. On the contrary, compared to the EU commission text, the European Council drafted a 2015 budgetary plan with a reduction of 0,5 billion in commitments and 2,1 billion in payments. Now a clarification is needed. The EU budget has to different voices of spending: commitments and payments. The first ones represent authorized ceilings to finance both programmes and projects, the second ones are the liquidity put at disposal by the member states. In other words, commitments mean nothing without payments. The European Council decided to disengage. Basically when the Council decides to cut the total payments ceilings means there are countries don't want to pay, as explained EU officials. These countries are the United Kingdom, Germany, the Netherlands, Sweden and Denmark, plus France with internal fiscal imbalances and for this reason not really ready to put so much money on the table. There's also to be considered the EU 2015 budget is just one part of the problem, since Draft amending budgets (DABs) have been proposed for the current annual financial framework. From February to September five DABs have been presented, for total 152 million of Euro of extra money to be put into the European budget for 2014. Now, this is not a huge amount of fresh resources, but of course countries are ready to postpone the disbursement as late as possible.
The European Union risks to block everything as it happened at the end of 2012, when an agreement over 2012 DABs made impossible to start negotiations on 2013 budget. For technical and practical reasons, in fact, it's not possible to star debating a financial cycle if the previous one has not be closes. In other words it is not possible discuss about the budget for 2013 if discussion on 2012 budget are not finished. That's what happened in 2012, and that's what can happen this year. It has to be recalled that according to procedure the European Council can start vote a EU Commission DAB only eight weeks after its presentation. Since last DAB (DAB5) has been presented the 8th of September, a discussion will be not possible until the 8th of November. Meanwhile both the European Parliament and the European Council will discuss all the other dossier related to budget issues at the Conciliation Committee, the special body convened to resolve any disagreements. Conciliation Committee works will start the 28th of October and will last until the 17th of November. For that day all the issues related to budget should be solved, but this is theory. The European Council decided for a 2,1 billion reduction in payments, with over 60% of these cuts - 1,3 billion Euros- affecting the EU budget headline 1a, that one dedicated to "Competitiveness for growth and jobs". A decision the EU Parliament doesn't like since competitiveness, growth and jobs should be boosted. The EU member states are ready to approve the total amount of 152 million Euros from DABs (rather than paying just one part in 2014 and transfer a second part of these 152 million extra payments to 2015) in order to don't change their position on 2015 budget. The debate is opened.
Once again the European Union is divided over financial questions. Annual or multi-annual financial framework it doesn't make any difference: the EU member States have argue and complain. For 2015 the European Council - the European institution composed by the government of the member States - have decided to reduce the total amount of payments. The European Commission proposed 145,6 billion Euros in commitments and 142,1 billion in payments. On the contrary, compared to the EU commission text, the European Council drafted a 2015 budgetary plan with a reduction of 0,5 billion in commitments and 2,1 billion in payments. Now a clarification is needed. The EU budget has to different voices of spending: commitments and payments. The first ones represent authorized ceilings to finance both programmes and projects, the second ones are the liquidity put at disposal by the member states. In other words, commitments mean nothing without payments. The European Council decided to disengage. Basically when the Council decides to cut the total payments ceilings means there are countries don't want to pay, as explained EU officials. These countries are the United Kingdom, Germany, the Netherlands, Sweden and Denmark, plus France with internal fiscal imbalances and for this reason not really ready to put so much money on the table. There's also to be considered the EU 2015 budget is just one part of the problem, since Draft amending budgets (DABs) have been proposed for the current annual financial framework. From February to September five DABs have been presented, for total 152 million of Euro of extra money to be put into the European budget for 2014. Now, this is not a huge amount of fresh resources, but of course countries are ready to postpone the disbursement as late as possible.
The European Union risks to block everything as it happened at the end of 2012, when an agreement over 2012 DABs made impossible to start negotiations on 2013 budget. For technical and practical reasons, in fact, it's not possible to star debating a financial cycle if the previous one has not be closes. In other words it is not possible discuss about the budget for 2013 if discussion on 2012 budget are not finished. That's what happened in 2012, and that's what can happen this year. It has to be recalled that according to procedure the European Council can start vote a EU Commission DAB only eight weeks after its presentation. Since last DAB (DAB5) has been presented the 8th of September, a discussion will be not possible until the 8th of November. Meanwhile both the European Parliament and the European Council will discuss all the other dossier related to budget issues at the Conciliation Committee, the special body convened to resolve any disagreements. Conciliation Committee works will start the 28th of October and will last until the 17th of November. For that day all the issues related to budget should be solved, but this is theory. The European Council decided for a 2,1 billion reduction in payments, with over 60% of these cuts - 1,3 billion Euros- affecting the EU budget headline 1a, that one dedicated to "Competitiveness for growth and jobs". A decision the EU Parliament doesn't like since competitiveness, growth and jobs should be boosted. The EU member states are ready to approve the total amount of 152 million Euros from DABs (rather than paying just one part in 2014 and transfer a second part of these 152 million extra payments to 2015) in order to don't change their position on 2015 budget. The debate is opened.
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