Brussels, 02/07/2002 (Agence Europe) - Adopting in Strasbourg on Tuesday the report by Goran Färm (PES, Sweden) preparing for the consultation with the Council over the draft budget for 2003, the European Parliament has called for changes to the Financial Perspectives, not only with a view to potentially ten new Member States joining the EU in 2004, but also in order to incorporate Cyprus and Malta's pre-accession credits under Heading 7 (expenditure linked to enlargement). It confirmed its desire to settle the problem of administrative expenditure in July (during the consultation procedure on 19 July) and is therefore calling on the other institutions to make a better assessment of the needs arising due to enlargement (where necessary anticipating 2003 expenditure and cutting the cost of agencies) rather than using the flexibility instrument to deal with the predicted overshooting of the ceiling for this heading in the Financial Perspectives.
Parliament said it was prepared to examine the Commission's proposal to increase Common Foreign and Security Policy (CFSP) expenditure by 33%, as long as the Council shows that it holds to the EP's priorities under Heading 4 for external action and does not challenge the traditional EU priorities. By 413 to 108 with 11 abstentions, Parliament felt that the Commission's proposal to create a special flexibility instrument to fund civilian crises should not be restricted to urgent needs but should allow greater recourse to the emergency reserve under Heading 4 for structural intervention in situations of external crisis. It showed it was willing to agree to the funds needed to send an EU police force to Bosnia, but calling for additional guarantees in terms of commitments made to Afghanistan. In terms of agriculture, by 445 to 88 with 14 abstentions the EP called on the Commission to present a proposal in the framework of the mid-term review of the CAP to considerably increase funding for rural development and cut direct payments.
The European Parliament adopted the report by Guido Podesta (Forza Italia) on implementing the 2002 budget credits, calling on the Commission to urgently implement the budget in the form in which it was adopted by the Budgetary Authority. The Commission is invited to improve the implementation of EU programmes and respect the action plan to scrap so-called abnormal outstanding commitments that have now reached EUR 110.447 bn, more than the EU's annual budget. The EP regretted that because of the rigid system, credits not spent in one sector couldn't be used to cover needs in another sector. The European Parliament is calling on the Commission to provide information about the use of EU funds by Israel and the Palestinian Authority.
During the debate, Färm said that the EP was calling for genuine reform in the framework of the 2003 budget, stressing the importance of reaching agreement with the Council about funds needed to be able to send an EU police force to Bosnia. He said there was a structural problem of lack of funding under Heading 4 for the Foreign and Security Policy (EFSP) and more money had to be found by either following the Commission's idea of setting up a special flexibility instrument to fund civilian crises (although he pointed out that the Council wasn't keen on the idea), or by taking up the EP's desire to make greater use of the emergency reserves.
While highlighting that the work for preparing for enlargement (Heading 5) had to be started as early as possible (in other words, before the July consultation meeting) in order for the timetable that had been laid down to be respected, Färm said that prioritising enlargement didn't mean that they had to approve willy nilly all expenditure on, for example, for staff costs. In order to make his reluctance clear about the Commission's proposal to use the flexibility instrument to cover this expenditure, he said that there was no way a blank cheque would be written and called for detailed priorities for staff needs to be determined by the Commission.
Podesta, the rapporteur on how the 2002 budget was implemented, said that the surveillance set up by the EP had identified two types of problems - an over systematic (and often ill-advised) use of the flexibility instrument and bad implementation of credits in some chapters (for example, Podesta pointed out that the Commission transferred more than EUR 2 billion in 2001 using bank transfers).
Schreyer says the Council's desire to cut Commission's administrative expenditure is unacceptable
Commissioner Michaele Schreyer regretted that the Council (the Budgetary Committee's working group) had planned to increase expenditure on publishing Community acquis by 12% in 2003 on 2002, an increase to be funded by cutting ordinary Commission expenditure.
She said it was a totally unfair way of operating and the proposal was unacceptable to the Commission. For the agriculture heading, changes in exchange rates should not be overlooked because the euro has gone up against the dollar, meaning that the margin under the ceiling of the Financial Perspectives has fallen by between EUR 400 and 500 million compared with the amount forecast in the Preliminary Draft Budget for 2003. For fisheries expenditure, Schreyer said the Commission would be unveiling a proposal (on 10 July) to finance some of the fisheries reform measures (EUR 32 million) using the flexibility instrument (the Commission had already proposed to use EUR 101 million from the flexibility instrument, EUR 27 million of which for restructuring the Spanish and Portuguese fishing fleets hit by the failure to renew the fisheries agreement with Morocco and EUR 74 million to cover the cost of preparing for enlargement). On EFSP expenditure, the Commissioner said that during consultation, they would have to think about how to ensure greater security for funding of the various operations. On foreign policy, she said the Commission was preparing the fourth Supplementary and Amending Budget in order to be able to use the margin made available last year in the 2002 budget, namely of EUR 70 million, for activities in favour of Afghanistan, pointing out that last year, Parliament and Council had left this sum in reserve, saying that it could be released as soon as detailed information became available about the programme for Afghanistan.