Brussels, 22/11/2001 (Agence Europe) - After a long working dinner with the European Parliament's delegation (headed by the President of the Budget Committee, Terence Wynn) the Budget Council managed to conclude its second reading of the draft budget for 2002 on Wednesday night. General agreement was reached between the two arms of the budget authority and the European Commission on the main areas of conflict - contributing to managing the Afghan crisis, converting fishing fleets (following the failed fisheries agreement with Morocco) and extra aid for cross-border areas of Member States bordering on candidate countries.
The Belgian Presidency and the Commission welcomed the agreement since it enables the broad outlines of the 2002 budget to be set out. During the negotiations, which reached fever pitch at times, Parliament got the Council to make use of EUR 200 million from the flexibility instrument (maximum amount allowed under the 1999 Inter-Institutional Agreement) for Heading 2 for Structural Actions, in order to finance not only the conversion of the fishing fleets (EUR 170 million), but also aid for cross-border regions of countries bordering on candidate countries (EUR 30 million) (Germany, Austria, Italy and Greece).
At a press conference on Thursday, Commissioner Michaele Schreyer, said that, occasionally to the detriment of some of its political priorities (co-operation with Latin America and MEDA), the EP had also greed that at least EUR 165 million be earmarked to "ensure a peaceful future" for Afghanistan.
The Council was given assurances that Parliament would not be over eager for payment credits when it formally adopts the 2002 budget in plenary on 14 December. The EP is reported to have pledged to limit the increase in payment credits (on the 2001 level) to 2%. By accepting the second letter of amendment (cutting agricultural expenditure by EUR 1.9 billion), the Council thereby cut payment credits by the same amount. Ms Schreyer insisted that the EP could always use its option to amend the draft budget under the headings of administrative expenditure and external actions, adding that the Belgian Presidency had skilfully managed the negotiations. The method selected at the end of the day by the Belgian Budget Minister, Johan Vande Lanotte, of negotiating privately with Member States that had made heavyweight demands (the United Kingdom concerning Afghanistan, Spain and Portugal for fishing and Germany representing the cross-border regions of the EU), proved to be highly effective. The expenditure decided on by the Council after first reading totalled EUR 98,454 billion in commitment credits and EUR 94.827 billion in payment credits (+1.8% on the 2001 credits which means the EP can increase spending by 0.2%). As a percentage of Member States' GNP, this draft budget implies an increase of 1.03%. The Council also decided to incorporate into the 2002 budget the income surplus (EUR 1.2 billion) from the 2001 financial year.
The salient points of the agreement, by heading:
1) External actions. A total of EUR 165 million in commitment credits to cope with the impact of the riposte to the 11 September attacks in Afghanistan, but the breakdown is not very clear: EUR 60 million from the EUR 488 million earmarked for the co-operation programme with central Asia and EUR 70 million from the remaining margin in the Financial Perspectives will be earmarked for Afghanistan; EUR 35million of the emergency reserve will be used (humanitarian aid) as proposed by the Commission. Ms Schreyer said that this aid would have to be accompanied by definite programmes (not yet the case). EUR 814 million are earmarked for the Balkans.
2) Structural actions. EUR 170 million of the flexibility instrument will be used in 2002 for converting the Spanish and Portuguese fishing fleets. To achieve the amount pledged to Spain and Portugal (EUR 197 million in total according to the Commission proposal), the Council, EP and Commission pledge in a declaration to be included in the budget for 2003 (it remains to be decided how this will be done) to provide the remaining EUR 27 million; EUR 30 million from the flexibility instrument will be allocated to cross-border regions in 2002, plus EUR 20 million from specific internal policy programmes (Heading 3: programmes for young people and SMEs). In another declaration, the EU expresses willingness to provide cross-border regions with a further EUR 15 million in 2003.