2017 EU budget: good chance of reaching a deal

9 Nov 2016 01:22 PM

On 8 November 2016, the Council and the European Parliament asked the Commission to draw up a compromise text to enable them to agree on the 2017 EU budget. At the first conciliation committee meeting on next year's EU budget the Council and the Parliament also got a better understanding of each other's position.

"It is now clear that there is a good chance of reaching a deal on the 2017 EU budget by the end of the conciliation period on 17 November - if the talks focus on what conciliation is about: agreeing a 2017 EU budget that addresses the migration crisis, reinforces security, boosts growth and creates jobs. Let's be pragmatic and use this window of opportunity", said Ivan Lesay, state secretary for finance of Slovakia and President of the Council.

Four major challenges

The presidency also used the conciliation committee meeting to recall the position of the Council in this year's budget talks. From the Council's perspective it is important that the 2017 EU budget

  • leaves sufficient margins under the expenditure ceilings of the multi-annual financial framework (MFF) for 2014-2020; this is to enable the EU to meet unforeseen needs
  • is in line with actual payment needs; this is to ensure that member states don't have to provide unnecessary high contributions to the EU budget at a time when they have to consolidate their public finances
  • respects the deal reached on the financing of the European fund for strategic investments; this is to leave sufficient leeway to allow the EU to meet unexpected needs for research and other future orientated expenditure
  • reflects the EU's institutions commitment to reduce their staff by 5% by 2017; this is to underpin the EU's credibility by showing that it lives up to its promises

Background

In its draft budget for 2017 the Commission proposed setting the total level of commitments at €157.66 billion and of payments at €134.90 billion.

The Council's position, adopted on 12 September, amounts to €156.38 billion in commitments and €133.79 billion in payments.

The Parliament asks for total commitments to be increased to €162.42 billion and total payments to €138.03 billion. This is at least €3.26 billion in commitments above the MFF ceilings.

As regards staff numbers, according to the methodology applied equally by the Commission to all institutions, the Council and the Commission will have reduced their establishment plan posts by 5.0% between 2013 and 2017; by contrast, the Parliament with its position adopted on 26 October took itself further away from achieving the agreed target by limiting the reduction of its staff to 2.3%.

Next steps

The next meeting of the conciliation committee will take place on 16 November. An Ecofin/Budget Council will meet on the same day to provide the presidency guidance for the talks with the Parliament. If no deal is found by the end of the conciliation period on 17 November the Commission has to present a new draft budget for 2017. If no budget is adopted at the beginning of 2017 only one twelfth of the resources in the 2016 budget or of the amounts proposed by the Commission for 2017, whichever is smaller, can be spent each month.

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