By Bruno Waterfield - 1st February 2006
EU “flexibility” budgets will be hiked from €200m to €700m a year after 2007 under European commission proposals published on Wednesday.
Rules governing the expenditure - reserved for unexpected events, such as natural disasters outside Europe – will also be eased allowing spending on EU policies such as youth or education.
The proposals potentially unlock €5bn on top of an EU budget deal for 2007 to 2013 agreed by Europe’s leaders last year.
The commission’s move could help secure early European parliament agreement and clear the way for Europe’s spending programmes to begin on time next year.
“Today, the flexibility instrument is limited… and is in practice used almost exclusively in the area of external actions,” said a statement
“The commission proposes today to increase the amount of the flexibility instrument… and to give it a broader scope, covering not only annual unexpected needs but also new multi-annual requirements.”
Parliament must back the seven-year EU financing package for spending to cleared and on January MEPs rejected proposals agreed at a summit on December 17.
MEPs are unhappy with spending cuts driven by penny-pinching national capitals and a deal €163bn less that the original commission proposals unveiled in 2004.
The extra €5bn will help the parliament swallow the bitter pill of overall budget cuts that national governments are unlikely to climb down on.
Also key to agreement will be involvement for the parliament in a review of Europe’s financing arrangements and spending priorities in 2008
“This exercise constitutes a high priority for this commission. It will be the fruit of detailed preparation and wide consultation in which European parliament should be deeply involved,” said a statement.
“In 2008/2009, the commission will present to the European Parliament and to (governments) a comprehensive white paper, covering the whole structure of the budget, expenditure and revenue sides.”
The proposals come in a draft “inter-institutional agreement” tabled by EU budget commissioner Dalia Grybauskaite.
“We need to have an agreement by April. Everyone understands very well that otherwise the execution of many EU programmes will be problematic as from January 1 2007,” she said.
“We have to act fast while being prudent, responsible and realistic. The credibility and effectiveness of the enlarged union is at stake.”
Her basis for accord between commission, MEPs and national governments also includes “basic rules of the European globalisation adjustment fund”.
The new €3.5bn fund will “support those workers suffering from the consequences of major structural changes in world trade patterns, to assist them with their re-training and job search efforts”.
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