Brussels, 02/06/2005 (Agence Europe) - On Thursday the Luxembourg Presidency unveiled a new compromise document on the upcoming Financial Perspectives (2007-2013). The ECOFIN Council will discuss the document next Tuesday, and the EU's foreign affairs ministers on Sunday 12 June. There are no huge differences compared with the version dated 19 May (see Europe Nos. 8950 and 8952). The Luxembourg Presidency suggests restricting commitment credits to around 1.06% of Gross National Income (GNI) of the enlarged Europe (EUR 864 bn over seven years), compared with the Commission's initial recommendation of 1.24% (EUR 1022 bn) or 1.00% (EUR 824 bn) as recommended by the six Member States supporting greater budget discipline. The document foresees the phasing out of the British rebate and the granting of measures to Germany, the Netherlands and Sweden to enable them to cut their contributions to the EU's budget. A summary of the changes suggested by the Luxembourg Presidency for negotiation:
Competitiveness for Growth and Employment. (Technological R&D, trans-European networks, education and training, etc). The new document suggests EUR 74 bn in commitment credits for 2007-2013, representing just over 8% annual real growth compared to 2006. The Commission suggested EUR 132.7 bn (including the Growth Adjustment Fund of EUR 1 bn a year that the Luxembourg Presidency has not taken into account because the Council opposes the idea).
Cohesion for Growth and Employment. (Cohesion policy.) Very little change here. The policy objective remains to concentrate the Structural Funds and the Cohesion Funds on the least developed regions and Member States while providing for satisfactory transitional arrangements in particular for those contributing most to such a concentration. The Luxembourg Presidency suggests an overall level of contribution appropriations of 0.37% of GNI for the EU27 (EU25 plus Romania and Bulgaria), in other words slightly over EUR 305 bn, compared with 0.41% in the Commission's proposal (EUR 338.7 bn). In its May compromise, the Luxembourg Presidency suggested between 0.37% and 0.38% of GNI. Like in its earlier version, the Luxembourg Presidency's new compromise suggests transitional arrangements for Member States and regions for which aid will gradually be phased out; and a gradually scrapping (over a two year period) of the Cohesion Fund for Spain.
Preservation and Management of Natural Resources. (Agriculture, rural development, fisheries and the environment.) No figures have been given here. The document notes that the amounts for market-related expenditure and direct payments correspond to those agreed at the October 2002 European Council. The Luxembourg Presidency does not rule out an additional package of EUR 2 bn to take account of the accession of Romania and Bulgaria. Between EUR 73 and 75 bn has been earmarked for the new 'rural development' instrument (compared with between EUR 69 and 77 bn in the previous compromise document).
Freedom, Security and Justice. The Luxembourg Presidency document suggests a total budget of EUR 7.4 bn over seven years for activity concerning freedom, security and justice (18% annual growth in commitments compared with the budget foreseen for 2006), plus EUR 4.5 bn for other internal policies, like culture, youth, health and consumer protection (5% annual growth compared with 2006). This means a total of nearly EUR 12 bn for this heading, compared with the Commission's suggestion of EUR 24.7 bn.
The EU as a Global Partner. The document foresees a total of EUR 51 bn from 2007 to 2013, i.e. annual real growth of 5% compared with 2006, not including the European Development Fund (EDF). The Commission foresaw EUR 92 bn including the EDF (EUR 21.8 bn from 2007-2013). The Luxembourg Presidency suggests making large cuts in administrative expenditure.
Own Resources. The Luxembourg Presidency suggests that the UK's rebate 'should correspond in 2007 to its nominal average over the seven-year period immediately prior to the most recent enlargement (1997-2003). This amount should be set on a downward path from the following year.' It suggests 'specific measures' for Germany, the Netherlands and Sweden covering the period 2007-2013 to cut their contributions to the EU's budget. Such measures might include a 'reduction in the rate of call of the VAT resource' for these countries in the period 2007-2013.