financial perspectives’ 2008/9 review the european council decided on the 2007-2013 financial...
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Financial Perspectives’ 2008/9 Review
• The European Council decided on the 2007-2013 Financial Perspectives on 19 December 2005 under the British Presidency
• Part III of the Decision states:
The European Council (…) invites the Commission to undertake a full, wide ranging review covering all aspects of EU spending, including the CAP, and of resources, including the UK rebate, to report in 2008/9. On the basis of such a review, the European Council can take decisions on all the subjects covered by the review. The review will also be taken into account in the preparatory work on the following Financial Perspective. (Council of the European Union, ‘Financial Perspectives’, 15915/05, Brussels, 19/12/2005)
• That is what we are going to do!
WaCoPaS Multiannual Financial Framework 2007-2013
Timetable
• 25 April 2006: Commission delivers a proposalProposal by the Team of tutors: Concentration on the first 4 headings of the 2007-2013 agreement
– Sustainable growth– Preservation and management of natural resources (incl. CAP)– Citizenship, freedom, security and justice– EU as a global player
• 10 May 2006: Member States/European Parliament deliver minimum and maximum papers (Commission only minimum paper)
• Coalition / Compromise negotiations take place• Presidency prepares a compromise proposal based on / in cooperation with (?)
the Commission for the negotiations in Warsaw • 25/26/27 May 2006: European Council in Warsaw
WaCoPaS Multiannual Financial Framework 2007-2013
Institutions
WaCoPaS Multiannual Financial Framework 2007-2013
European Parliament
Role• At first sight limited in the actual negotiation, BUT the member states should
not disregard the position of the EP• The FP can only enter into force through an inter-institutional agreement
between the EP and the Council, i.e. the budgetary authority
Position• Calls for ‘appropriate’ financial resources for the EU• Political priorities such as competitiveness, growth and employment /
citizenship, freedom, security and justice and budgetary priorities need to be brought in line
• Stresses the need for more flexibility in the annual budgetary procedure, i.e. the FP cannot replace the yearly budgetary procedure
WaCoPaS Multiannual Financial Framework 2007-2013
Commission
3 priorities during the negotiation in 2004/2005:• Promoting sustainable development by completing the internal market and mobilizing
various policies (economic, social and environmental) to that end. The objectives of competitiveness, cohesion and the protection and management of natural resources also fall under this heading.
• Giving meaning to the concept of European citizenship by completing the area of freedom, justice and security and ensuring access to basic public goods and services;
• Promoting a coherent role for Europe as a global partner.
Position:• Believes that the significance of the challenges identified justifies an increase in the budget
but can be drawn up within an overall own resources ceiling of 1.24% of GNP. • Suggests that from 2013 onwards the financial perspective should be established for a
period of five years, which would fit in better with the institutional timetable • Calls for the solidarity found to be integrated into the financial framework.
Political context regarding the 2008 review:• Institutional weakness of the Barroso Commission, lack of political leadership• Uncertainty on the institutional future of the EU (draft constitutional treaty)
WaCoPaS Multiannual Financial Framework 2007-2013
Council Secretariat
• Crucial role• Formally: simply support of presidency
– minutes / synthesis report – together with presidium – Collecting written interventions– Timing of the meetings
• But: Power of drafters– Importance of the first text– can help to build informal compromise (in mission of
presidency?)
• tension between member states interest and EU interests
• own interests
WaCoPaS Multiannual Financial Framework 2007-2013
Members States
WaCoPaS Multiannual Financial Framework 2007-2013
Czech Republic (Presidency)
Priority as Presidency:• Finding an Agreement
Priorities:• Maintaining the EU budget’s subsidies for poor regions… and
specially for the CR• Very strong support for the structural funds and the Cohesion
funds
Other positions:• Support to the agreement on the financing of the CAP from
2002• In favor of expenditure supporting the goals of the Lisbon
Strategy
Possible coalition partners: other new MS
WaCoPaS Multiannual Financial Framework 2007-2013
France
Context:• Traditional support for the progress of the EC budget (Mitterrand…)• Europe as a delicate political issue : refusal of the Draft Constitutional
Treaty by referendum (29th May 2005)
Position:• Support to the principle of a limitation of the EC budget : a shift in
France European policy ?• Strong support for CAP spending
(refusal to re-consider the Chirac-Schröder agreement)• In favor of a suppression UK abatement : tensions between Blair and
Chirac
Political context regarding the 2008 review:• Presidential election in 2007 : Chirac will leave. Will CAP spending still
be considered as a major priorities by France?• Possible coalitions : Germany, Mediterranean countries?
WaCoPaS Multiannual Financial Framework 2007-2013
Hungary
Context :• Decrease in EU-enthusiasm one year after entry : failure to bring increased political and
economic stability ; old Member States put a curb on economic integration of the new Member States
• Hungary is looking forward to closing the transition period and acquiring the status of a full Member State.
Position :• Strong support for high EU budget : cohesion and structural funds are to be raised in order
to close the economic gap within the EU• Strong support for CAP spending and the current CAP agreement• In favor of a fair burden sharing, e.g based on GNI level• The British rebate is not a main issue as long as it is not a brake for a high enough budget
Possible coalitions :• New member states for higher budget• Cohesion and structural funds beneficiary countries (Spain, Italy, Portugal)• Agricultural countries on CAP agreement
WaCoPaS Multiannual Financial Framework 2007-2013
Ireland
Context:• Former net recipient, profited a lot from cohesion funding• Stresses importance of the Lisbon agenda goals and cohesion funding
especially for the new member states
Position:• Encourages more generous budget than 1,0% (in favor of the Lisbon
agenda goals and cohesion funding)• Strong support for CAP spending• In favor of a suppression UK abatement
Possible coalitions :• New MS, “small” MS, europhile MS…
WaCoPaS Multiannual Financial Framework 2007-2013
Italy
Context:• Net contributor to the union’s budget• Major recipient of the Union’s cohesion policies
Position:• Is for maintaining a rather tight budget (the ceiling of this budget may
be fixed up to 1.06 of the union’s GDP)• Refuses to increase its net contribution to the Union’s budget• The significant reduction of the UK rebate was one of its major priority• May accept a redirection of funds away from CAP towards other areas
(such as Denmark)• Strongly opposed to any reduction in cohesion policy funds (such as
Spain)
Political context regarding the 2008 review:• Possible changes of Italy European policy: Berlusconi vs. Prodi
WaCoPaS Multiannual Financial Framework 2007-2013
Netherlands
Context:• Rejected the Commission’s proposal of an increase in the budget
to 1.24% of EU GNI in 2004• Rejected the « generalised correction mechanism » proposed by
the Commission during the Luxembourg presidency because it did not offer enough compensation
• Europe as a delicate political issue : refusal of the Draft Constitutional Treaty by referendum (June 2005)
Position:• For a new orientation in the spending policy: only the poorest
members should benefit from structural funds; the agricultural costs of Bulgaria and Romania should be reduced, cuts in export subsidies
• For maintaining the budget ceiling of 1%• For reducing its net contribution to the budget • Possible coalitions : Sweden? UK?
WaCoPaS Multiannual Financial Framework 2007-2013
Spain
Context:• For a long time a net receiver, global financial position towards EU is
tending to neutrality• Strong beneficiary of Development funds since 1986• Eligibility to Cohesion Funds will stop soon due to strong growth rates
and a raise in standards of living level. Number of regions eligible to Structural Funds strongly threatened.
Position:• Against any global reduction of European budget spending (new MS)• Supports a phase-out of regional aids, and a share contribution to
enlargement costs• Strong commitment for spending related to Security and justice
(terrorist attacks) and the fulfilment of Lisbon objectives• Not in favour of a reduction of the CAP amounts• Very strong intention to reduce the UK abatement (3rd largest
contributor after France and Italy)• Possible coalition partner: France?
WaCoPaS Multiannual Financial Framework 2007-2013
Sweden
A “modern” budget:• Critics of the EU model of expenditure. In favour of
reform of the CAP.• Strong supporter of a modern budget profile, i.e.
supporting growth, research and development• Wants to connect the financial perspective and the
Lisbon strategy
A “reasonable” contribution:• Sweden is among net contributors• Supports a share contribution to the budget• Willing to support the enlargement but refuses for
relative rich countries in southern Europe
WaCoPaS Multiannual Financial Framework 2007-2013
Germany
Context• Has long been the paymaster of the EU; however, in the
current economic situation does not want to stay in this position
Position • Wants a budgetary ceiling of 1,00% of GNI, but is open to
negotiate• Would welcome a reduction / abolishment of the British
rebate, but this is not the most important issue at stake• Criticizes a reduction of payments from the structural /
cohesion funds to the new member states• The French-German compromise on CAP was not to be opened
up again in 2005; however, for the 2008/9 review there should be the possibility for new negotiations
Possible Coalition Partners• Net payers (‘letter of the six’), new member states, France
WaCoPaS Multiannual Financial Framework 2007-2013
United Kingdom
Context• Very Eurosceptic public
Position • Wants a FP that can be sold to the public, therefore
– the total expenditure by the EU must remain low– the British rebate must be protected– the Common Agricultural Policy needs to be cut back– the budget must appear to be modern and responsive to
the problems currently facing Europe
Possible coalition partners• Net payers (‘letter of the six’)
WaCoPaS Multiannual Financial Framework 2007-2013
Poland
Position
• Against reduction of the overall budget to make sure that policies like CAP and structural assistance are phased in for the new member states as soon as possible.
• Cautious about the proposed ‘Globalisation Adjustment Fund’
• Against earmarking large parts of the structural funds to ‘growth and jobs’ (Lisbon Strategy)
• In favour of abolishing the British rebate and against a general correction mechanism for net payers
Possible Coalition Partners• New member states, France
WaCoPaS Multiannual Financial Framework 2007-2013
Portugal
Position
• No reduction of the overall budget• Ensure that the cuts for the current cohesion countries
are as small as possible • Importance of the funds for ultra-peripheral regions
(Azores, Madeira)
Possible Coalition Partners
• Greece, Spain, new member states (overall size of the budget)
WaCoPaS Multiannual Financial Framework 2007-2013
Greece
In Principle• The Luxembourg Presidency Proposal is considered as a
minimum (1,06% of GNI)• The redistributive dimension of the EU finances should
correspond to its quasi-federal ambitions at a time when enlargement has brought in countries with important structural problems
In Practice• Most important issues are agricultural and structural
funds including support for Mediterranean products and fisheries
Possible Coalition Partners:New member states, Portugal, Spain
WaCoPaS Multiannual Financial Framework 2007-2013
Finland
Context• Finland is a net contributor and does not want to see its
net contributions risePosition• Supports the Commission in its opinion that
competitiveness is important, but does not want to favour it at the cost of agricultural policy
• Against the British rebate, but this is not the most salient issue
• Main interest: rural development and regional policy
Possible Coalition Partners• Net payers, possibly esp. France
WaCoPaS Multiannual Financial Framework 2007-2013
Luxembourg
Context • The negotiations on the FP failed in June 2005 under the
Luxembourg PresidencyPosition• The Luxembourg Presidency compromise proposal foresaw:
– a budget volume of 1,06% GNI– a reduction of the British rebate, mainly related to more spending
for cohesion policy in the new member states• More money for competitiveness, less spending on CAP• Generally in favour of the „Globalisation Adjustment Fund“
proposed by the CommissionPossible Coalition Partners • Many member states had been able to agree with the
Luxembourg proposal, except for the UK, Sweden, the Netherlands, Spain and Finland
WaCoPaS Multiannual Financial Framework 2007-2013
Latvia
Context• EU is seen as a means to reduce „social and economic
backwardness“ (Prime Minister Kalvitis)
Position• Most important: cohesion fund• In favour of reassessing the priorities of the EU budget
especially in relation to CAP• Against the British rebate• Calls for solidarity between member states
Possible Coalition Partners• New member states, budget modernizers
WaCoPaS Multiannual Financial Framework 2007-2013
Slovakia
Background information• Slovakia is a very liberal market economy (flat income
tax of 19% for everybody)
Position• In favour of a modernization of the budget
– Reduction of CAP spending– Increased investment on education, research and
information technology• Against the proposed „Globalisation Adjustment Fund“
Possible Coalition Partners• New member states, UK
WaCoPaS Multiannual Financial Framework 2007-2013
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