Explanatory Memorandum to COM(2018)814 - Towards a swift agreement on a long-term budget for Europe's priorities - The European Commission's contribution to the European Council meeting on 13-14 December 2018 - Main contents
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| dossier | COM(2018)814 - Towards a swift agreement on a long-term budget for Europe's priorities - The European Commission's contribution to the ... |
|---|---|
| source | COM(2018)814  |
| date | 04-12-2018 |
Contents
- Brussels, 4.12.2018
- r Eur
- A SWIFT AGREED
- The EU budget reflects the Union's commonly agreed priorities and shows how they can be
- The Commission's proposals modernise the budget by providing a significant and necessary
- Cohesion Policy and the Common Ag ricultural Policy will continue having a vital role to play
- E v o I ution
- m m i ssio n
- INED FINANCIAL ARCHITECTURE
- Significant progress has been made in the negotiations on the programmes proposed by the Com mission. M any are now close to a partial general approach in the Council. W h i I e a
- cil should confirm the principle of a simpler, more streamlined
- A FLEXIBILITY TOOLBOXT
- Fairness lies at the heart of the Commission's proposals and is key to an agreement on the
- The size of the EU budget as a percentage of gross national income (GNI)
- Average 1993-1999
- European Development Fund
- m mission
- The Commission's proposals have been widely recognised as a fair and balanced basis for the
COM(2018) 814 final
COMMUNICATION FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT, THE EUROPEAN COUNCI L AND THE COUNCIL
T
owards a swift agreement on a long~term budgetfo
ope s priorities
The European Commission s contribution to the European Council meeting on
13~14 December 2018
EN
TOWARDS A SWI FT AGREEMENT ON A LONG-TERM BUDGET FOR EUROPE'S PRIORITIES
1. Keeping up the momentum
The E uropean Uouncil meeting on 13-14 Dec ember will be a crucial milestone in the negotiations on the future I o n g ~te r m budget of the Union, ahead of the Sibiu Summit on 9 May 2019. I t will be an opportunity to give new impetus to the process by consolidating the considerable progress already made and providing clear direction on the key features of the future framework. This will prepare the ground for the next, decisive political phase of work.
On 2 M ay, the Uom mission put forward proposals for a fair, balanced and modern budget to deliver on the most important issues for Europe s future, as outlined by Leaders in Bratislava o n 16 S e pte m b e r 2016 and R o m e on 25 M arch 2017. T his was followed with unprecedented speed by legislative proposals for the 37 sectoral program mes that will form part of the future long_term budget. These proposals have been widely recognised as a solid basis for the neg oti ati o n s .
Intensive work in the European Parliament and the Council has enabled encouraging progress to be made. The E uropean Parliament adopted its Interim Report on 14 N o v e m b e r 2018 and will agree its positions on a number of sectoral proposals by the end of the year. In the Council, work led by the Bulgarian and Austrian Presidencies has allowed the key political
issues for the future long -term budget framework to be identified in a draft 'N e g oti ati n g
Box" P artial general approaches have already been agreed on several specific programmes and others are on track. The E uropean Economic and Social Committee , the Committee of the Regions and the European Court of Auditors have also contributed to the debate.
Converting this momentum into a political agreement will require strong leadership from the European Council, working in close cooperation with the European Parliament, the Council and the Uommission, W ith the European Parliament elections Just around the corner, agreement by Leaders on the key parameters underpinning the new long~term budget by the time ofthe Sibiu Summit on 9 May 2019 would show that the Union at 27 is united and ready to deliver on the things that matter most to Europeans. It would make it possible to get the new programmes up and running by 1 J a n u a ry 2021, avoiding the unacceptable delays ofthe p a st.
The Commission calls on the European Council to confirm its goal of making maximum progress on the future framework by the time ofthe Oibiu Oummit on 9 May 2019. A political agreement on the new long~term budget should be achieved by the European Council in October 2019. T his would allow its adoption by the Uou ncil by the end of 2019 after the consent ofthe Quropean Parliament.
Reso I u ti o n of 14 Nov ember 2018 on the M ultiannual Financial Framework 2021 -2027 - Parliament's
position with a view to an agreement.
2 The Negotiating Box is a document of the Presidency that supports the horizontal negotiations in the
European Council and in the Council. It includes a number of elements that will form the basis for a package deal f o r the European Council. It is built progressively, with the range of options narrowed over time. Opinion of 19 S e pte m b e r 2018. Opinion of 9 0 cto b er 2018.
Briefing Paper of 10 July 2018 on the Commission's proposal for the 2021 2027 M ultiannual Financial
Framework. The Court of Au ditors has also subm itte d a number of more specific briefing papers related to different aspects of the next M ultiannual Financial Framework.
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"HE BENEFIT OF ALL EUROPEANS
A swift agreement on the future long-term budget would allow the Un ion to look to the future with
confidence. It would show Europe's strength and unity at a crucial moment for the Union, and
demonstrate the capacity to act to protect, empower and defend, It would provide a boost to the economy and avoid damaging delays to essential i n vestm e nts, such as were seen in 2014,
/4 timely agreement would, for example.
accelerate Europe s digital transformation, investing in h i g h ~ p e rfo r m a n ce computing, artificial intelligence, cybersecur ity and digital skills to compete on the global technology market,
create tens of thousands research jobs already in 2021 and many more in the wider economy,
allow o ver 100,000 projects funded under Co hesi on Po iicy (e.g, business support, energy efficiency, healthcare, education, social inclusion) to start on time,
allow 1,000,000 young people to benefit from an Era smus exchange and give the opportunity to 40,000 young people to engage in so I i d a r ity action across Europe in 2021,
support sta rt~u ps and small and medium ~s ize d companies to realise th e ir investments,
ensure funding to a number of iarge~scale infrastructure projects such as Europe s space programmes, the Rail Ea/tica project or the Brenner base tunnel,
significantly step up defence investments and capabilities, to enhance Europe's strategic
autonomy in protecting and defending its citizens,
support the development of a fully integrated European border management system, protecting the Union against trafficking, smuggling and fraud,
2. A modern, balanced package tightly geared to the Union's priorities
delivered. The political agenda set out by Leaders in Bratislava and Rome is the roadmap for the future long~term budget. At a time of immense challenges and opport unities, the Union of 27 needs a budget that will help it to deliver efficiently across all priorities. I he budget should offertangible answers to the challenges of technological, demographic and climate change. It should show how the Union is ready to protect itself again st new securi ty threats and geopolitical instabili ty. A nd it should show unequivocally that Europe will continue investing in sustainable economic growth, as well as strengthening social and territorial cohesion.
funding boost in key areas. From innovation to the digital economy, from training and employment for young people to climate action and the environment, from migration and border management to securi ty, defence and external action, the budget will invest where it really counts. The proposal also provides the basis for strengthening and completing the Economic and M onetary Union, where there is an urgent need to speed up work on new instruments as part of the future financial framework.
for Europe's future. The Commission has proposed to modernise these essential pillars of the
EU budget so that they continue to evolve in line with new priorities and the changing economic and social realities. This will be done by b ette r targeting support to where it is needed, updating priorities in line with the objectives set in Bratislava and Rome, introducing more effective delivery systems, and forging a much closer link with the economic reform process coordinated through the European Semester.
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of main policy areas in the
EU b u d g et
50%
40%
30%
Common Agricultural Policy and Fisheries
Administration
P J J?
Other programmes include for example:
" Horizon Europe ' Digital Europe Programme ' Single M arket Program me " Erasmus
" Asylum and Migration Fund ' Internal Security Fund ' European Defence Fund " Neighbourhood, De v e I o p m ent a n d International Cooperation Instrument
*Adjusted for 1995 enlargement
So u roe , European Co
For the first ti me, the Commission has proposed that the large st share of the budgetwill be allocated to programmes such as Erasmus, Horizon Europe, Digital Europe, Border M anagement, and Secur i ty . Strong support for Cohesion Policy and the Common Ag r i c u 11 u r a I Policy is also maintained.
As proposed by the Com mission, it will be essential for the credibility of the new long-term budget to strike the right balance between these broad expenditure areas — agriculture and maritime policies, Cohesion Policy and the other programmes that will
be so vital to Europe's future.
3. A simpler, more streamlined, and more transparent budget
Over ti me, the EU budget has become too complicated, too fragmented and too burdensome when it comes to following the rules governing financial programmes. The resounding message from all stakeholders has been the urgent need for simplification and streamlining. This has been a recurring theme from the European Parliament and Council, as well as by beneficiaries large and small, from students to farmers, from small business to big business, from non~profit organisations to public authorities.
Heeding those calls, the Commission has proposed to simpli f y radically the budget. The new headings and clusters illustrate more clearly what the EU budget is for and how it suppo rts the political priorities. I he number of programmes has been reduced from 58 to 37 . New, streamlined programmes in strategic areas such as external action and the Single M a r k et will make investment from the EU budget more visible and better targeted. It will also help fully exploit the synergies b etw een different EU programmes. I here is a stronger focus on performance and on sound financial management, including through the new mechanism designed to ensure that generalised deficiencies in the rule of law do not put the budget at risk. This further illustrates the emphasis placed on efficientand effective implementation.
For
legal reasons, a limited number of programmes are based on more than one legal act.
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/4 streamlined budget with simpler rules will make it easier for different programmes and instruments to work together to boost the impact of the EU b u dg et, For ex am pIe .
► InvestEU: pooling centrally managed financial instruments into Invest EU will allow for significant economies of scale and a standardised approach, Simplified and streamlined i n vestm ent support, with one set ofruies and procedures and one point ofcontact for advice, will help maximise the impact ofthese instruments,
European Social F~ und Plus, integrating several important instruments will enhance their impact and create synergies and complementarities, Financial support is becoming more flexible to respond to economic and social challenges, and the administrative burden for authorities and beneficiaries will be reduced,
Single KAarket. the creation of a single integrated programme will increase the support of the EU budget for the Single rket, new programme will reduce overlaps, enhance
synergies and facilitate communication and networking with stakeholder groups, The new programme will offer greater value for money and cost efficiency,
Border f\Aa n a g e m e nt. the proposed integrated fund, with its two components on border management/visa and customs control equipment, will help ensure better and more integrated management of the ELI s external borders, and a higher level of bo r de r secur ity in the Un ion,
External Action, the new integrated instrument for the neighbourhood, development and
international cooperation will increase the effectiveness and visibility of the EU's external
action, It will strengthen coordination with internal policies and give the EU the flexibility to respond more quickly to new crises and challenges,
Significant progress has been made in the negotiations on the programmes proposed by the Com mission. M any are now close to a partial general approach in the Council. W h i I e a
number of issues still need to be addressed, the work to date shows that the architecture of the
Commission's proposals for the next financial framework and the different programmes has
found broad support.
The E uropean v_^oun
budget, on the basis of the simplified architecture and programmes presented by the Co,
• m m i ss ion.
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4. A more flexible budget
The need for flexibility in the budget has never been more acute or more apparent than it is today. In a highly turbulent and uncertain world, it is impossible to predict where the EU will need to a ct in 2027. F, exibility instruments are therefore built in throughout the budget. I he value of this flexibili ty was shown when Europe needed to respond urgently to the economic and financial crisis, and laterthe migration crisis.
fO ADDRESS EL EMERGENCIES
ERGING PRIORITIES AND
Since 2014, the EU budget helped to address new priorities and unforeseen needs, while ensuring tangible solidarity with regions in Europe and the rest of the world affected by emergencies, The various flexibility mechanisms were for example instrumental in.
Responding to the economic and financial crisis. EUR 196 million was mobilised to support the reintegration in the labour market of displaced workers who lost their Job as a result of major structural changes, in sectors such as the automotive industry, air transport, road transport, machinery and equipment, shipbuilding and manufacturing. The reinforcement of the EU G uarantee Fund of the European Eund for Strategic Investments by EUR 2A billion
further supported the Fund's capacity to boost investment throughout Europe. The Youth
Em pioyment Initiative provides an additional EUR 12 billion between 2017 and 2020 for the integration of young people in the labour market.
Addressing the refugee crisis in Europe and in the neighbourhood, reinforcements of over EUR 5.6 b iiiion over the years 2015 to 2018 were provided to address the consequences of the
refugee crisis within the EU and in the Union's neighbourhood, to reinforce border control
and security, and to develop investment opportunities in countries oforigin,
W Showing the Union's solidarity: EUR 1.6 b iiiion worth of support was provided to regions in
16 Member Sta tes affected by natural disasters such as floods, forest fires, drought and
earthquakes, EUR E5 billion was mobilised to reinforce the Union's humanitarian actions in
countries affected by crises and in particular aid to refugees and persons displaced because of co nfi Icts.
The future budget should be a more flexible budget. It is right to look critically at what could be done better, which the Commission did through its comprehensive spending review. The assessment shows that the current flexibili ty system works well. AII of the current in st rumen ts serve a distinct purpose and should be the basis for the flexibili ty provisions in the future long_term budget.
This has been highlighted by the European Parliament which ' a q rees with the overall
a r c h itectu re of the fi ex i b i I ity mechanisms in the 2021-2027 MFF; stresses that the special instruments have different missions and respond to different needs, and opposes any attempts to merge them, str o n g Iy s u p p o rts the clear provision that b oth commitment and payment appropriations deriving from the use of sped a I i n str u m e nts should be e ntere d in the budget over and above the relevant hA EE ceilings, as we II as the removal of a ny capping to the adjustments flowing from the global margin for payments .
The E uropean Uouncil should confirm the need for a more flexible long~term budget to react quickly, decisively and efficiently in a fast_changing world, based on the architecture proposed by the Com mission.
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5. A fair budget that can deliver
future long_term budget, both in terms of how and where the EU budget is spent, and of how the budget is financed. This must be a budget for all Europeans, investing in areas where the EU budget can deliver what national budge ts cannot. Wh ere funding is allocated by M ember State, the criteria used must be fair and objective, with the same rules applying to all.
The future long~term budget must also provide the Union with the resources needed to deliver efficiently and to rise to new challenges. At the same time, the financial consequences of the United Kingdom s withdrawal must be accounted for in a fair way. Proportionate savings musttherefore inevitably be made in the largest spending areas.
0.03%
I
0.03% 0.03% 0.02% ^^^^
0.03% ■■ 0
1.25%
1.09%
1.12%
Average 2000-2006
Average 2007-2013
Average 2014-2020
Average 2014-2020, EU-27*
2021-2027**
Commitments ceiling in % EU GNI
*2014-2020 estimated commitments
(UK expenditure excluded) in % EU27 GNI
** European Development Fund integrated ('budgetised')
So u rce , European Co
The Commission has proposed a budget equivalent to around 1.11 % of the gross national income of the future Union of 27 Member S tates. I his is based on a rigorous assessment of the resources needed to deliver on the Union s objectives, while addressing the sho rtf a I I created by the United Kingdom s withdrawal in a balanced way. Some M ember States have argued for a smaller budget. Oth ers have Joined the Luropean Parliament s call for a larger
one. The Commission's proposal strikes a fair balance that is both ambitious and realistic.
The principle of fairness must extend to the financing of the budget. The reform of the Union s own resources system is long overdue. This is a unique opportunity to make the system fairer and more transparent, as well as to diversi f y sources of financing.
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The Commission has proposed a basket of possible new own resources chosen for their strong link with European policies. They would allow a share ofthe benefits ofthe internal marketto accrue to the EU budget and be reinvested back into the European economy. M oving away from a system dominated by national contributions through the introduction of new own resources would help to shiftthe emphasis to the benefits ofthe EU budgetto all Europeans,
A modern and fairapproachto financing the EU budget also means that the same rules should apply for everyone. W ith the withdrawal of the United Ixingdom the complex system of rebates and corrections will end. To cushion the impact of this change on M ember States currently receiving a correction, the Commission has made the pragmatic proposal to phase out all corrections over a period of five years.
The Commission welcomes that reform of own resources is a top priority for the European Parliament. It also notes the willingness of many M e m b e r States to engage constructively on the possible introduction of new own resources.
The next IV1 ultiannual Financial Framework should allow the Union to deliver efficiently on its priorities in a way that is fair to all. As part of this, the European Council should support the ongoing work on the reform ofthe financing ofthe EU budget and agree on the principle of introducing new own resources.
6. Towards a swift agreement on a budget for Europe's priorities
The U n i o n of 27 needs a modern long~term budget that is fairer, simpler and more flexible. The budget should allow the Union to deliver efficiently on the priorities Leaders agreed together in Bratislava and Rome. It should strike the right balance b etw een the main spending areas and bring meaningful reform to the financing ofthe EU b u d g et.
negotiations. The rapid progress that has already been made in the European Parliament and the Council has created a solid platform for a swift agreement. Strong leadership from the highest political level is now needed to make this happen. It is not yet time to decide on figures. But a shared understanding about the principles and structure for the new budget is an importantstep towards a comprehensive agreement in the near future.
At a time of change for the Union, an early agreement on the future long~term budget would showthatthe Union is united and ready to act. Taking longer would delay the implementation of the future programmes, with real consequences for regions, small businesses, farmers, researchers and young people and everyone who benefits from the EU budget.
By the time ofthe Sibiu Summit, maximum progress on the future long~term budget should be achieved. A comprehensive agreement on the long~term budget, including figures, should follow in the Quropean Uouncil by vJ ct o be r 2019 at the latest. I his work should be done in close collaboration with the European Parliament, in view of enabling the adoption ofthe next IV1 ultiannual Financial Framework by the end of 2019.
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