Presentation by the Council of the draft general budget - Budget 2009 (debate) 
President
The next item is the debate on the presentation by the Council of the draft general budget for 2009. I therefore welcome Éric Woerth, Minister for the Budget, Public Accounts and the Civil Service, as the representative of the Council Presidency.
Éric Woerth
President-in-Office of the Council. - (FR) Mr President, ladies and gentlemen, it is both an honour and a pleasure for me to speak in your House today for two reasons: firstly, because your Parliament represents the heart of European democracy. The French Presidency has a tremendous amount of respect and admiration for the work that you have done in support of European integration, and the best possible proof of our willingness to help Europe move forward together was provided by the French President in his speech in Strasbourg in July. It is this same spirit that guides me and is shared by my colleagues in the French Government. Secondly, because the draft budget for 2009, which I am presenting to you today, was adopted unanimously by the Council on 17 July. This unanimity shows that this draft budget is balanced and that it allows all EU governments to identify with it.
Our initial contacts have provided a sound basis for the continuation of the budgetary procedure. The trialogue and conciliation meetings have taken place in a constructive atmosphere. We have already reached agreement on six statements, and I am sure that we shall be able to agree on many other matters of common interest.
I can assure you that the Council is prepared to continue this high-quality dialogue with a view to securing an agreement on the 2009 budget that is satisfactory to all.
This agreement should comply with three principles: the first is to ensure the financing of the European Union's policy priorities - and we have established a financial framework for the period from 2007 to 2013 that we must implement in order to achieve our objectives in terms of competitiveness, cohesion and growth. The second is to observe the rules of budgetary discipline and sound financial management laid down in the Interinstitutional Agreement. Expenditure must remain within the limits fixed by this Agreement and sufficient margins must be maintained under the ceilings for the various headings. The third principle requires that appropriations be adjusted to take into account actual requirements. In particular, we should draw lessons from previous budget outturns so as to be able to determine our real ability to implement sectoral policies. Moreover, since the establishment of the financial perspective in 1988, the Community budget has always been subject to an under-utilisation of payment appropriations. Budget implementation is improving thanks to the efforts made by Commissioner Dalia Grybauskaité, but uncertainties related to the financial year 2009 clearly remain considerable and there is no evidence, at this point, to suggest that 2009 will be any different from previous years.
It is also important to protect the interests of European taxpayers - this is all the more true in the current economic climate - and so we must avoid, as far as possible, entering in the budget any appropriations that cannot be utilised. The objective of a realistic and balanced budget has consequently been the guiding principle of the Council's work.
Before presenting the fruits of its labours to you, I should like to say a word on the facility for rapid response to soaring food prices in developing countries. Our discussions over the next few weeks will focus on this issue. The European Council of 19 and 20 June provided a strong political impetus by welcoming the Commission's intention to come forward with a proposal for a new fund to support agriculture in developing countries. However, the European Council mandate is quite explicit in this respect: it is in strict compliance with the current financial perspective that a solution has to be found.
I am aware that the European Parliament does not currently share this view. Nevertheless, the Council will evaluate the proposal adopted by the Commission on 18 July from this perspective.
Finally, I would remind you that the European Council reaffirmed only yesterday its readiness to support reconstruction efforts in Georgia, including in areas of South Ossetia and Abkhazia, in addition to the EUR 6 million in emergency aid that have already been disbursed. The EU will therefore take the initiative of convening an international conference shortly to assist reconstruction in Georgia. Yesterday's European Council requested the Council and the Commission to start preparations for this conference.
I should now like to present to you the main thrust of the 2009 draft budget established by the Council.
We are proposing a budget of EUR 134 billion in commitment appropriations, which amounts to EUR 469 million less than in the preliminary draft budget. The increase in commitment appropriations therefore amounts to 2.8% compared to 2008 and, as a result, the EU's overall commitment capabilities are maintained.
As for payment appropriations, the Council has made an adjustment limited to EUR 1.7 billion compared to the preliminary draft budget. As you requested in previous years, the Council has not been making random across-the-board cuts to all headings. This reduction is based instead on a detailed analysis of budget implementation in 2007 and 2008 and on a realistic approach to the potential of Community programmes to be implemented and completed. The draft budget therefore amounts to EUR 115 billion in payment appropriations.
The reduction in the level of payment appropriations in 2009 does not - and I should like to emphasise this point - come as a surprise. It had been taken as read when the financial framework for 2007-2013 was adopted. If the ceiling on payment appropriations in 2009 is far lower than that in 2008 and 2010, this can be explained, in particular, by movements in appropriations for the cohesion policy, which will be affected in 2009 by the end of the 2000-2006 programming period and by a gradual increase during the 2007-2013 programming period. We also have seen no indication that new programmes have been able to get off the ground more quickly. On the contrary, the mechanism for the monitoring of the adoption of management and control systems and of major projects shows that they are getting off to a slow start. Therefore, out of 433 programmes, there are only two, in Hungary, for which interim payments have been made.
The level of payment appropriations in our draft budget is therefore realistic and adapted to the needs of the Union.
A few points should be emphasised heading by heading.
With regard to the heading 'Competitiveness for growth and employment', the Council attaches great importance to the implementation of the Lisbon Strategy. It has therefore ensured that adequate financing is provided, particularly for research and technological development programmes, trans-European networks and improving the quality of education and lifelong learning. The Council has limited the increase in commitment appropriations on the basis of the analysis of the potential of programmes to be implemented, as I have already said.
Nevertheless, I should like to emphasise that, in this context, the increase in commitment appropriations is quite considerable for priority programmes. For instance, compared to 2008, the Research Framework Programme will receive a 10% increase, the innovation and competitiveness programme a 16% increase and the 'Lifelong Learning Programme', essential for European citizens, will receive a 6% increase.
These examples clearly illustrate the targeted strategy adopted by the Council. Moreover, the Council has reduced payment appropriations (by EUR 471 million) by making cuts on several targeted lines so as to take into account how the appropriations were utilised.
With regard to heading 1b, 'Cohesion for growth and employment', the Council has accepted the amount of commitment appropriations proposed by the Commission in the preliminary draft budget. For payment appropriations, we adopted a balanced approach by introducing, on the one hand, an increase of EUR 50 million for convergence countries and regions and, on the other, a reduction of EUR 300 million in the area of regional competitiveness.
This means a reasonable overall reduction of EUR 250 million in payment appropriations, and I am delighted that we were able to agree on a joint statement on the Structural and Cohesion Funds as well as on the rural development programmes.
With regard to the heading 'Conservation and management of natural resources', the Council has adopted a limited reduction of EUR 382 million in commitment appropriations and of EUR 497 million in payment appropriations. These concern mainly budget lines related to market intervention and clearance of accounts and, to a reasonable degree, rural development.
I would also point out that the budget lines related to food programmes, free distribution of fruit and vegetables, school milk and promotion measures have been maintained. We have also maintained the amounts proposed by the Commission for environmental policies.
With regard to heading 3, 'Citizenship, freedom, security and justice', the Council has made a slight increase in the margins available under the ceilings to reach a total of EUR 76 million by making targeted reductions of EUR 20 million in commitment appropriations. In this context, I should like to emphasise the importance attached by the French Presidency to immigration policy. The amount proposed in the preliminary draft budget for the Frontex Agency has therefore been included.
With regard to heading 4, 'The EU as a global partner', we have sought to anticipate the needs related to Palestine and Kosovo without waiting for the Commission's letter of amendment, which it should be adopting next week. We have therefore set aside additional resources, compared to the preliminary draft budget, of EUR 100 million for Palestine and EUR 60 million for Kosovo.
Regarding the CFSP, the Council has accepted, as a precautionary measure, the commitment and payment appropriations which were entered in the preliminary draft budget and which are in line with the amounts provided for in the Interinstitutional Agreement of 17 May 2006. As for payment appropriations, the reduction made amounts to EUR 393 million, but half of this reduction relates to the reserve for emergency aid and, as you know, the Council considers that it may be possible to finance this reserve by redeploying payment appropriations, as has been seen in recent years.
Finally, with regard to heading 5, 'Administration', the Council has adopted a controlled increase of 3.8% in administrative appropriations which it deems necessary to ensure the proper functioning of the institutions. The margin available under heading 5 therefore amounts to EUR 224 million. The Council has, of course, accepted the 250 posts linked to the 2007 enlargement. We have also made targeted reductions based on past implementation, rather than making across-the-board cuts, which have become almost a tradition.
Finally, with regard to decentralised agencies, we have taken account of the life cycle of these agencies. We cannot deal with agencies that have already reached cruising speed in the same way as agencies that are still developing their expertise - agencies that are at the development stage - and we have taken into account the surplus generated by some agencies in previous financial years. This is the case for Frontex and Eurojust, two agencies that fall within our priorities.
In conclusion, I therefore feel that the 2009 draft budget represents a balance between the ambitions that we naturally all have for our European Union and sound budgeting for which we are answerable to the citizens. This is clearly essential if citizens are to share this confidence in the European idea.
The view of this House will probably be different, but we are only at the beginning of the budgetary procedure and we still have plenty of time to harmonise our views on the structure of the 2009 budget and to respond to the challenges facing us as a result of the Commission's new proposals. I am sure that the three institutions will therefore make every effort so that, between now and conciliation in November - in two months' time - we can reach a comprehensive agreement on all these issues, and I hope that this agreement will be the best possible compromise for both the institutions and European citizens. You can obviously count on my total commitment with that in view.
President
Thank you very much, Minister. You deserved a rather better turnout, but the quality of our Members counts for a great deal. Today, of course, we are engaging in an initial discussion, and a former minister who once held your office is also in attendance.
Jutta Haug
rapporteur. - (DE) Mr President, Commissioner, President-in-Office of the Council, you just said that we are at the start of the budgetary process. As far as Parliament is concerned, that is not the case. We had begun the budgetary procedure and discussions on the procedure and on our budget for 2009 at the start of the year. We have therefore come a long way already. In particular, moreover, we in Parliament are agreed that neither the Commission's preliminary draft budget nor the Council's draft - which, as we know, has pruned back the appropriations for both commitments and payments contained in the Commission's estimates, is particularly inspiring. We certainly do not regard it as an ambitious budget that satisfies the demands made of us in the European Union in every possible area of political activity.
In particular, Parliament has recurring difficulties with the fact that, for all the constant and ubiquitous talk of wanting to tackle climate change, this intention is insufficiently reflected in the budget. We in Parliament - as you can see from the overwhelming support the chamber gave the negotiating team from the Committee on Budgets in the July vote - will ensure that the fight against climate change can be stepped up in many parts of the budget and that this can be done with European funds. We do not believe that such a wide gap can remain between the appropriations for commitments and those for payments as the 15% proposed by the Commission, which has subsequently been further widened by the Council.
Instead, we shall ensure that we obtain a budget which is more in tune with the principles of budgetary accuracy and clarity. No doubt we shall have the occasional heated discussion this autumn. I am very hopeful, however, that we shall arrive at a satisfactory outcome once we have come to an arrangement with each other on certain matters.
Janusz Lewandowski
rapporteur. - (PL) Mr President, in autumn we embark, as usual, on the decisive phase of the budget procedure, this time for the year 2009. Our task is to note and take account of all the changes that have occurred since submission of the preliminary budget proposals.
The greatest problem and difficulty for me, as rapporteur on the budget of the European Parliament and the other European institutions, is the uncertainty as to the fate of the Lisbon Treaty. The budget forecasts for 2009 were based on the most likely outcome, namely entry into force of a treaty that fundamentally enlarges the European Parliament's powers of co-decision. Since at the present time there is a question mark over the Treaty, the normal reaction with regard to the budget is to separate the expenditure directly linked with the Lisbon Treaty from the preliminary expenditure for the coming year, and that was the request we put to all the European institutions. We have a response from the European Parliament, which is currently being examined. It is not yet an official document of Parliament's Bureau, but it meets the requirement to separate expenditure linked to the Lisbon Treaty, which can be taken into account later if the situation changes.
Obviously the uncertainty as to the fate of the Lisbon Treaty affecting the budget for 2009 does not excuse us from applying the other principles governing establishment of the expenditure plan for 2009. We have to take account of the new rules on MEPs' remuneration and the remuneration and employment of assistants. We have to cover the costs of the European election campaign and take account of the movements in prices of the various energy sources that occurred in 2008. Above all, 2009 is an election year, in which we must strive for rigour and financial discipline. An expansion of European bureaucracy - European administration, in other words - is not the best message to send to people whom we are asking to renew the mandates of members of the European Parliament.
I would like to draw attention to one more matter that concerns me not as the European Parliament's rapporteur but as a member of a community of democratic nations concerned with human rights and the sovereignty of all the nations of Europe. We should react, on a budgetary level too, to what has happened in Georgia. I believe the European Parliament should take a position on this question at the first reading, since it will be difficult to persuade European taxpayers to continue providing unconditional aid to Russia when it is spending money on wars beyond its borders.
Kyösti Virrankoski
Vice-Chairman of the Committee on Budgets. - (FI) Mr President, Minister, Commissioner, first of all I would like to say how thankful I am that next year's draft budget is now before Parliament. At the same time I wish to say how sorry I am that our Committee's chairman, Reimer Böge, cannot be present at the debate, as he has important obligations in his country at the same time. For that reason, I will make the speech for the Committee on Budgets for him.
I want to thank the Council and its Presidency for their constructive cooperation, as at the budgetary conciliation meeting in July we made important, joint declarations which relate to the implementation of the Structural and Cohesion Funds, the European Solidarity Fund, the European Globalisation Adjustment Fund, and staff expenditure, besides other matters. This also bodes well for a positive atmosphere at the conciliation meeting in November. Unfortunately, the Council has not been quite as cooperative as regards the financing of the numerous new posts which were discussed and included in the resolutions at the European Council in June, for example.
The Commission's preliminary draft budget was already very meagre. Commitment appropriations stood at EUR 134.4 billion, which is 2.6 billion below the financial perspective, and payment appropriations were even more meagre at EUR 116.7 billion. This is the equivalent in payments of just 0.9% of the EU's GDP, which is substantially below the already extremely compromised financial framework, at an average of 1%. The Council has cut the budget further by a total of EUR 500 million in commitment appropriations and EUR 1.8 billion in payment appropriations.
In my opinion, this much reduced budget does not reflect either the EU's or Parliament's priorities. It is very dangerous to have made cuts to heading 1, which is vital for sustainable growth and employment. The paucity of payment appropriations is a particular threat to structural policy, which is one of Parliament's major priorities. Its implementation has already been greatly delayed in any case.
It is quite clear that heading 1 in the budget needs to be looked at in particular, but so does heading 4, which seems to be chronically underfunded from one year to the next. At this very moment there are difficulties with Kosovo and Palestine.
Finally, I would like to raise two issues. The first is the Food Facility Instrument. The Commission is proposing approximately EUR 1 billion for the development of food aid and production in developing countries. Parliament supports this, but regrets that the Commission has not proposed any suitable instruments. The interinstitutional agreement is a good opportunity for this, and the Committee on Budgets is ready and willing to back it on this issue too.
The European Parliament is also ready to support reconstruction in Georgia. The budgetary procedure also provides opportunities for this. We hope that when the Commission makes promises on behalf of the European Union at the next Conference of Donors they will be discussed with the budgetary authorities beforehand.
Dalia Grybauskaitė
Member of the Commission. - Mr President, I would like to recall the very good atmosphere of our negotiations which we began in the spring, finalising them before the summer vacation. I hope that we will be able to proceed in this manner throughout the whole procedure.
I would like to draw your attention to the fact that we will have four main blocks of problems in our negotiations. The first one concerns the level of the payment appropriations, which have been cut by the Council by EUR 1.8 billion. In the evaluation of the Commission's proposal, Parliament thinks it is too modest and the Council thinks it is too ambitious; so I hope that we will be able to find a compromise and a proper budget for Europe by the final stage of our negotiations.
The second block of problems is concentrated in Heading 4, and here I would like to mention three elements: additional resources for Kosovo and Palestine; the emergency aid reserve, especially as there will be needs requiring a fast response this year and next year; and of course the upcoming donors' conference to help Georgia, and here - at least today - we do not yet have a decision on the table.
The third block which the Commission sees as a problem concerns administrative expenditure, where as usual the Council approves posts but cuts the financial funding. This means that for the Commission, at this stage and with these proposals, it will not be possible to recruit additional staff, although 250 enlargement-related posts have been approved.
The fourth block concerns the food facility. At the Council's prompting, we made a proposal which has not yet at this stage been approved as an instrument by the Parliament. So this is the fourth block of our negotiations which I see as problematic.
So, in general, there are only these four points which may cause difficulties. For the rest it is very well prepared and very well calculated, and I think that for the most part we can very rapidly reach agreement. If we maintain the spirit of cooperation which we have today, I hope that we will solve all our problems.
Éric Woerth
President-in-Office of the Council. - (FR) Mr President, firstly, thank you for this discussion. I should like to say to Mrs Haug that this budget clearly is ambitious, even if the levels are not quite the same when you refer to the various headings. However, we naturally share the same objective and we obviously need to reconcile our differences of opinion. We now have two months in which to do so.
Secondly, Mr Lewandowski, regarding your comments on the consequences of the Treaty of Lisbon, we share your desire which is actually to consider that the ratification process has not yet been concluded and that it is therefore wise not to enter these costs in the budget. I think that we clearly share the same opinion on this issue. You mentioned Georgia. The European Commissioner has actually referred to this as one of the major issues that we need to resolve, and the Council has expressed its views on the subject. We must now endeavour to flesh out the policy areas identified yesterday afternoon.
Mr Virrankoski, with regard to the preliminary draft budget, you say that it is already extremely tight and that what we are actually doing is tightening it even more. That is true. However, first we must draw a distinction between commitment appropriations and payment appropriations. In the case of commitment appropriations, there is an increase of just under 3% compared to 2008. I think that this shows how ambitious we are. Regarding payment appropriations, it is true that a reduction of a similar magnitude is planned. I tried to explain that we carried out a very detailed analysis and that this is not the result of a random and undiscerning method of reducing payment appropriations. It is purely and simply the result of an analysis of the rate of utilisation of appropriations of the various policies. I tried to explain this, heading by heading. To go back to heading 1 briefly, it is true that there is a reduction, but, at the same time, within that reduction, there is a planned increase of EUR 50 million for convergence countries and regions; I wanted to mention this. Under heading 4 - the Commissioner mentioned this as well - there is an increase in appropriations for Palestine and Kosovo, and half of the reduction in appropriations entered in the draft budget relates to the emergency reserve that can be financed, as has been the case so far, through the redeployment of resources. Obviously, we have until November to discuss in more detail issues that are specific, clearly defined and subject to certain parameters, and we shall endeavour to find the best possible compromise, a compromise that would, of course, help us forge ahead.
President
That was an important interim debate on the budget. You were all very quick to refer to the crisis and the war in Georgia. As you know, I made a statement to the European Council on that issue yesterday, and I sense that the opinion I expressed yesterday is shared by all sides in the European institutions. Thank you.
