Brussels, 11/06/2014 (Agence Europe) - On Wednesday 11 June, the European Commission adopted the EU draft budget for 2015 - which provides for a moderate rise in commitments compared with the 2014 budget (+2.1% in commitments to €145.6 billion, and +1.4% for payments - which is virtually absorbed by the estimated inflation rate for 2015).
“We have highlighted growth and jobs, but we must also tackle the arrears - in other words, everything that has not been paid and that dates back to last year”, said European Commissioner for Financial Programming and Budget Janusz Lewandowski at a presentation of the draft 2015 budget to the press. Lewandowski spoke about the problem of the snowball effect of commitments that have still not been paid, and he underlined the need “to stabilise the European budget situation” and to reduce the number of posts in the European institutions. “This is the third consecutive year that we are cutting staff by 1%”, he said.
The arrears problem (2013 invoices that still need to be paid) remains unsolved, with an estimated sum of €23.4 billion, said Lewandowski. However, the Commission hopes that this backlog will gradually be reduced. “In fact, there will be fewer invoices that will come in at the beginning of the programming period. There should be €10 billion less than in 2014. We can therefore reduce the problem and return to normal arrears” (around €6 billion), Lewandowski said in response to questions from the press. He defended his draft amending budget (+€4.738 billion in payments for 2014) presented on 28 May (see EUROPE 11090) and believed that it was necessary to use all the possibilities offered by the treaty to solve the problem - including the contingency margin.
Lewandowski spoke of “a small increase” in commitments (+2.1%) but “we are still €2 billion below expenditure in the 2013 budget”, he stated. “We are making more Europe but with less money”, he also noted.
Most of the commitments concern future projects that will consolidate Europe on the economic level, while some 40% of the payments still relate to projects for the 2007-2013 period financed by the EU. The Commission is proposing another 1% cut to its workforce - the third such cut in three years.
As regards cohesion, Lewandowski said that there were fewer debts expected for 2015 (the peak was in 2014 with €60 billion - a historic level). “A small part of the spending will be allocated to the new 2014-2020 programming period”, said Lewandowski.
Regarding external action, Lewandowski spoke of a financial aid package for Ukraine (an envelope is planned in 2014 and also in 2015 for this country). As concerns humanitarian aid, “we are learning the lessons from Syria. We must pay and not only promise commitments. So the commitments correspond to the payments as regards humanitarian aid for 2015”, he said.
The Commission points out that the commitment appropriations focus on new programmes (multiannual financial framework - MFF 2014-2020) and nearly 60% of the amount proposed is planned for research and innovation programmes, and programmes for youth and businesses in Europe.
Most of the payment appropriations are dedicated to sectors favouring economic growth and employment in Europe (+29% compared with 2014) - such as research (Horizon 2020), trans-European energy, transport and information technology networks (Connecting Europe Facility), or the Youth Employment Initiative. Other areas recording an increase in payments are the Asylum, Migration and Integration Fund (+140%) and protecting Europeans' health and consumers (+20%).
The functioning cost of the EU remains stable at around 4.8% of the total budget. Its increase (+1.6%) is around the expected rate of inflation and therefore does not increase in real terms. The draft budget also includes a third 1% reduction in staff in three years. Finally, the Commission cut the expenditure and staffing requests of other EU institutions to better align them with the staff reduction target of 5% over five years and apply restraint to other administrative costs. “Salaries and pensions in the European institutions are going up less than inflation”, said Lewandowski. With the next European Parliament not yet in place, there are no funds planned in the 2015 budget at this stage, but the figures will be adjusted during the budgetary procedure for 2015.
Summary of draft budget by heading. (1) Smart and inclusive growth: €66.6 billion in commitments (+4.2% compared with 2014 budget) and €67.1 billion for payments (+1.2% compared with 2014 budget); (1a) Competitiveness: €17.4 billion in commitments (+5.8%) and €15.6 billion in payments (+29.5%); (1b) Cohesion: €49.2 billion in commitments (+3.6%) and €51.6 billion in payments (-5%); (2) Natural resources: €59.2 billion in commitments (+0.0%) and €43.9 billion in payments (+0.3%) including €43.9 billion (both in commitments and payments) of market-related expenditure and direct aid (+0.3%); (3) Security and citizenship: €2.1 billion in commitments (-1.9%) and €1.9 billion in payments (+12.2%); (4) Global Europe: €8.4 billion in commitments (+1.1%) and €7.3 billion in payments (+7.1%); (5) Administration: €8.6 billion (+2.5%) in commitments and in payments; (6) Special instruments outside MFF (in other words, emergency aid reserve, European Globalisation Adjustment Fund - EGF - and EU Solidarity Fund): €515.4 million in commitments (+13.0%) and €225 million in payments (-35.7%).
What are the next steps? Following the Commission's adoption of the 2015 draft budget, the Council (member states) will adopt its position, followed by the European Parliament. This will be followed by a 21-day conciliation period to find a compromise between the Council and Parliament. (LC)