Brussels, 24/01/2006 (Agence Europe) - The three EU institutions have started their negotiations over the formal adoption of the EU's new budget (the 'Financial Perspectives 2007-2013'). There are still sharp disagreements over how to improve on the deal struck at the European Council in December last year in order for the European Parliament to formally adopt the package. At the first 'budget trialogue' (meeting between the European Commission, European Parliament and Council) on 23 January, the three institutions decided on a preliminary schedule of talks. Another trialogue will be held on 21 February, and one more on 21 March, ahead (it is hoped) of full agreement at the end of March. The formal adoption of the Financial Perspectives 2007-2013 by the European Parliament may take place in April, according to the European Commission, but EP sources it is more likely to be in May 2006.
There has been little progress since the EP resolution on 18 January rejecting the December deal struck by EU heads of state (see EUROPE 9112). The talks will only really get going when the Austrian Presidency receives its mandate from the Council and when the European Commission has unveiled proposals to guide the negotiations. On 1 February next week, the Commission will unveil a new draft inter-institutional agreement, expected to recommend greater flexibility in the budget and giving details about the exact details of the budget review clause (the budget review process is due to start in 2008). At the end of February, the European Commission will unveil two further documents, one on setting up a Globalisation Adjustment Fund (as decided by the European Council), and another on amending the own resources decision (to take account of the Summit deal on new calculation methods for the British rebate, redefining the VAT rules in favour of Austria, Germany, the Netherlands and Sweden, and cutting the Swedish and Dutch contributions to the EU budget).
At the January trialogue, the Austrian Presidency said the budget deal had been tough to negotiate and it would therefore be difficult to change the amount decided upon. On 25 January, the Austrian Presidency will brief COREPER on the outcome of the 23 January trialogue, when Member States will decide on how to proceed in the negotiations.
At a press conference on 23 January, the President of the EP's Budgets Committee, Janusz Lewandowski (EPP-ED, Poland) said people would have to wait for the 21 February trialogue to see what room for manoeuvre the Council really had in the budget talks. The EP is awaiting a European Commission assessment of the European Council's cuts in the budgets of various multi-annual programmes and is prepared to strike a deal with the Council, said Lewandowski, but not at any price.
The EP's reporter on the Financial Perspectives, CDU MEP Reimer Boge, told reporters that the European Parliament was prepared to strike agreement in the next three months but it all depended on the degree of flexibility in the Council's negotiating mandate and the new draft inter-institutional agreement. He listed the EP's wish list for the cuts made by the European Council, namely the huge increase in the R&D budget (+75% in 2013 compared with 2006 levels ) agreed in the European Council deal which meant there had to be cuts in other programmes, like the trans-European networks and life-long learning. The Council cannot decide on its own, said Boge, on the budget for rural development (where big cuts had been made) or on the details for the Structural Funds regulation (granting derogations to new EU Member States based on the n+2 rule, and various sweeteners to different Member States), warned Boge. He said that EP figures suggested that the European Council deal was a 30% cut on the initial proposals unveiled by the Prodi Commission for the EU's main foreign policy instruments (pre-accession, cooperation and the EU Neighbourhood Policy). Boge said two key demands for the EP were the budget review clause and flexibility (the EP is calling for the current flexibility instrument, described as not going far enough, to be replaced with greater flexibility outside the EU budget per se, to enable the funds (0.03% of EU25 gross national income) to be more rapidly mobilised.
The European Commission is prepared to agree with the EP on two issues. A spokesperson for Budget Commissioner Dalia Grybauskaite said the Commission supported MEPs' philosophy on more flexibility in budget spending and more EP involvement. During the trialogue, Grybauskaite called for improvements and corrections in various areas of the European Council deal. She said the impact of the cuts decided by the heads of state would have to be alleviated in areas like trans-European networks, education and customs (under the employment and growth competitiveness subheading), rural development (under the conservation of natural resources heading) and consumer protection, particularly from bird flu (under the other internal policies heading). The Commission thinks the problem of lack of resources for EU foreign policy measures can be solved through greater budget flexibility.