2001 DRAFT BUDGET
10299/00 ADD I
Draft general budget of the European Communities for the year 2001.
|Basis of consideration:
||Minister's letter of 5 December 2000
|Previous Committee Report:
||HC 23-xxx (1999-2000), paragraph 17 (22 November 2000)
|Discussed in Council:
||23 November 2000|
||Cleared (decision reported on 22 November 2000)
13.1 On 22 November 2000, we reported on
the amendments and proposals made by the European Parliament in
respect of the Council's Draft Budget for 2001. We invited the
Minister to write to us again after the Budget Council on 23 November
at which the European Parliament's proposals and amendments were
due to be considered, along with the Commission's Letter of Amendment
No. 2 to its Preliminary Draft Budget (PDB) for 2001, relating
to provision for agriculture and fisheries.
13.2 In our report of 22 November, we noted
that the main area of contention between the Council and the European
Parliament related to expenditure in the external actions
category. The Council had reduced commitments to the Mediterranean
countries (the MEDA Programme) in order to make increased provision
for the Western Balkans whilst staying within the financial perspective
ceiling for that category. The European Parliament wished to increase
provisions for the Western Balkans, including assistance to Serbia
to aid democratisation, but it opposed cuts in the MEDA Programme.
The Minister's letter
13.3 In her letter of 5 December, the Economic
Secretary to the Treasury (Miss Melanie Johnson) says that:
"At its second reading
of the Budget, the Council agreed to mobilise the flexibility
instrument (maximum 200 million euros) for Serbia.
Total commitments of 839 million euros were agreed for the Western
Balkans in 2001, including 240 million euros for Serbia (of which
200 million euros is from the flexibility instrument), and 175
million euros for Kosovo. This is consistent with what was agreed
at the General Affairs Council on 20 November regarding the CARDS
and MEDA multi-annual programmes, where financial envelopes were
agreed of 5.35 billion euros for MEDA and 4.65 billion euros for
CARDS for the period 2000-2006".
13.4 The Commission's Letter of Amendment
No. 2 to its PDB for 2001 updates the figures underlying the estimates
of agricultural expenditure in the PDB as regards the market organisations
and related measures. The Minister explains that requirements
are expected to be 932.5 million euros lower than initially forecast
in the PDB. The Minister goes on to explain that:
"The Commission also
proposed to correct the levels and breakdown of appropriations
for the international fisheries agreements. The overall effect
is a reduction of 2.7 million euros in commitments and 0.7 million
euros in payments for [these] agreements compared with the PDB.
This also translates into an increase of 4 million euros as earlier
estimates in the Draft Budget were 7 million euros lower than
the PDB. ...Council accepted Letter of Amendment No. 2 in full,
although it agreed to increased spending for fruit and vegetables
and 60 million euros were set in reserve for rapid testing for
13.5 In respect of the internal policies
category of the Draft Budget the Minister says that:
"... Council and Parliament
also agreed to the financing of a new multi-annual Employment
Initiative (2001-2005) at the level of 450 million euros. 100
million euros are to be committed in 2001".
13.6 The Minister notes that the European
Parliament will meet on 12 December to debate its second reading
of the 2001 Budget and will take a vote on 14 December, when it
is expected the Budget will be adopted.
13.7 We thank the Minister for her letter.
We will in due course report again on the Draft Budget, as amended
at the November Budget Council, when that document is deposited
and we have an Explanatory Memorandum from the Minister. Meanwhile,
we are glad that it now seems likely that the European Parliament
will adopt a Budget reflecting, on the key points, the outcomes
reported in the Minister's letter. We note that the Council has
not increased its provision for external aid to the Mediterranean
countries (MEDA), notwithstanding pressure from the European Parliament.
However, it remains possible that the European Parliament will
make some increase for MEDA, within the financial perspective
ceiling for external action, when it adopts the Budget in December.
13.8 We note also that, for the second
year running, it has not been possible to make all the desired
provision for the Western Balkans without drawing on the flexibility
instrument. Without that instrument, either the desired provision
could not have been made available or the financial perspective
for external action would have had to be increased. We recognise
that the Government and the Council strongly oppose any increase
in the financial perspectives, as agreed in the Agenda 2000 negotiations
last year. However, it is evident that the pressures in the external
action category are, and are likely to remain, very strong.
26 The financial instrument allows up to 200 million
euros to be provided, exceptionally, for a specific purpose, without
it counting against the financial perspective ceiling for the
category of expenditure in question. Back
is the acronym for the multi-annual Balkans programme. Back