Brussels, 13/07/2007 (Agence Europe) - On Friday 13 July, the Council of Finance Ministers of the EU member states reached unanimous agreement in Brussels on its first reading of the draft EU budget for 2008. The Budget Council has prepared a rigorous budget for next year, at this stage of the proceedings of a total of €128.4 bn in commitment appropriations (up 1.4% on the 2007 budget) and €119.41 bn in payment credits (up 3.4% on the 2007 budget). It confirmed the provisional strategy for the funding of Galileo and foresaw extra funding for Palestine (€80 million more, making a total of
€260 m) and €180 m in aid for Kosovo (see details in EUROPE 9467). The aid for these two countries has been put in the reserve while awaiting more detailed budget projections from the Commission in October 2007. In terms of payment credits, the total expenditure foreseen by the Council in first reading only amounts to 0.85% of the EU27's gross national income (GNI). The next stage in the budget procedure is a vote by the European Parliament in first reading on 25 October 2007 of the draft budget for 2008.
The Portuguese presidency of the Council of the EU welcomed the excellent outcome of the first reading by the Council, saying it boded well for the rest of the budget procedure for 2008. Emanuel Augusto Santos, the deputy Portuguese finance minister, said he was sure that the Council would adopt a budget making it possible to fund the EU's policies and priorities. He said the meeting had drawn closer to the EP over practically all budget issues.
EU Budget Commissioner Dalia Grybauskaite was not so optimistic. She protested against the Council's huge reductions in the budget for research, training and Erasmus (saying some 30% of students would be lost). She spoke of cuts in very controversial areas of funding when the Council was asking the Commission to find ways of funding the European Technology Institute (ETI) and the EU's satellite navigation system, Galileo. On the ETI, the commissioner said that the Council had created the legal basis and confirmed the €308 m needed to launch the institute next year, but the toughest part was yet to come because ways of mobilising the money now had to be found. She said that the Commission would be publishing options in this connection in the autumn. The Council believes that there is enough margin under the relevant budget heading to enable the EU to launch the ETI.
Grybauskaite criticised the Council's tactic of agreeing to the 853 new jobs demanded by the Commission to meet the needs of enlargement while cutting the budget for the new officials' salaries by €53 m. The commissioner said the budget cuts would mean only 18 of the 853 new officials could actually be recruited. She also criticised the reduction of posts in the EU agencies of nearly 40% on the European Commission's initial proposals. Grybauskaite said that this was the first time the total EU budget amounted to so little in terms of payment credits (0.95% of EU27 GNI).
Liaison with the EP. During conciliation with the Council, the European Parliament delegation expressed dismay at the cuts in the research budget, adding that when it comes to foreign affairs, the financial needs of Kosovo, the common foreign and security policy and Palestine should not jeopardise the EP's traditional priorities in other areas of the world. The EP agreed to accept the statements prepared by the Council on decentralised and executive agencies.
The draft budget in detail: - Competitiveness (Sub-heading 1a). The Council foresees a total budget here of €9.50 bn in commitment appropriations (up 7.2% on the 2007 budget) and €8.99 bn in payment appropriations (up 27.6% on the 2007 budget), in other words €266.4 and €548.4 m respectively less than in the Commission's Preliminary Draft Budget. The budget for the 7th Framework Programme of R&D is € 5,9 bn in commitment appropriations (7.7% more than in the 2007 budget) and €5.8 bn in payment appropriations (up 45% on the 2007 budget) - Cohesion (Sub-heading 1b). The Council foresees € 46.87 bn in commitment appropriations (up 3.1% on the 2007 budget) and €40.12 bn in payment appropriations (up 6.2%) for the Structural Funds and Cohesion Funds - Natural resources (Heading 2). The draft budget foresees €55.72 bn in commitment appropriations and €54.21 bn in payment appropriations (down 0.9% on the 2007 budget both for commitment and payment appropriations), including €41.94 bn (commitment appropriations) for direct farm aid and farm market expenditure - Citizenship, freedom and justice (Heading 3). The total is €1.27 bn in commitment appropriations (down 0.1% on the 2007 budget) - External actions (Heading 4). The draft budget foresees €7.12 bn in commitment appropriations, including the emergency aid reserve (€239 m) - Administrative expenditure (Heading 5). The budget foreseen here is €7.19 bn (commitment and payment appropriations), including €4.5 bn for the Commission (including pensions and European schools). The budget includes €206 m in compensation.