Brussels, 30/08/2012 (Agence Europe) - On Thursday 30 August, in Nicosia, during the informal meeting of European affairs ministers of the EU, the Cypriot Presidency of the EU Council of Ministers prepared the ground for a fall in the initial amounts proposed by the European Commission in the context of the multiannual financial framework 2014-2020. It suggests in its working paper that total amounts proposed by the Commission should be reduced and considers that the cut must concern all EU budget headings, including Cohesion Policy and Common Agricultural Policy. This was something which gave rise to criticism from many ministers, the Commission and the European Parliament delegation. On the other hand, a number of so-called “net contributor” countries welcomed the Cypriot presidency's intentions to reduce the initial amounts.
Talks will continue with a view to reaching a compromise in Council on this dossier by the end of the year. An extraordinary European Council is due to be held in November on the financial framework 2014-2020.
During the press conference, Cypriot minister Andreas D. Mavroyiannis said the Commission proposal represented 1.11% of the EU's Gross National Income (GNI). He said that a group of countries has called for a substantial reduction in the amounts so as not to exceed 1% of GNI, which is a difference of €140 billion. The figures will be gradually added (as of September) to the “negotiating box” on the 2014-2020 financial framework, Mavoyiannis said.
“Most delegations reiterated their stances and their red lines, but some admitted the need to make compromises”, a European source said. Some so-called net contributor countries, such as Germany, the Netherlands, the United Kingdom, Sweden, Denmark and Finland, called for a reduction (of at least €100 billion, according to some of these countries) of the envelope proposed by the Commission. The latter suggests that a total of €1,033 billion in commitment appropriations be granted for the period 2014-2020, and €988 billion in payments. Net contributors call for 1% of GNI of the EU not to be exceeded. Some of these countries welcomed the fact that the Cypriot Presidency, in its working document submitted to the informal meeting, evokes the need to reduce the initial amounts proposed by the Commission in the hope of reaching a compromise on the 2014-2020 financial framework.
In the other camp, a number of the 15 so-called “friends of cohesion” countries (Poland, Spain, Portugal, Bulgaria, Croatia, Czech Republic, Greece, Hungary, Romania to name a few) called for more money for cohesion. Some of those countries criticised the fact that the Presidency is counting on a reduction of Cohesion Policy allocations to focus more on funding for the less developed regions of the EU. The Commission noted that 14 countries, broadly support the overall amounts that it proposes. The Presidency also suggests a cut in the initial envelope proposed for agriculture and rural development. France, supported by some countries such as Ireland, defended keeping the current level of funding devoted to the Common Agricultural Policy (CAP). On the other hand, the United Kingdom and Sweden recommended a reduction in the level of agricultural spending proposed.
Timetable in disarray.
The Cypriot Presidency hoped to submit a new version of the negotiating box on the financial framework 2014-2020, giving figures for the first time, to Coreper on 12 September, then to the General Affairs Council on 24 September. However, the likely holding, in November, of a European Council specifically dedicated to the financial framework has turned the initial timetable upside down.
In the working document submitted to ministers, the Presidency “recognises that it is, therefore, inevitable that the total level of expenditure proposed by the Commission, including all elements inside and outside of the multiannual financial framework, will have to be adjusted downwards”.
On the receipts section, the Presidency notes that a large majority of delegations are calling for reform of the current system for financing the EU budget. Some countries, like France, have supported the introduction of a tax on financial transactions. On the plan to abolish the own resource based on VAT, the Presidency suggests that the Commission provide more information on the consequences of that abolition in terms of simplification, its innovative nature and equity. The EP delegation greatly underlined the need to create new own resources in order, in particular, to reduce the amount of contributions by EU countries and to have greater flexibility on the use of funding. (LC/transl.jl)