Mr President, firstly I would like to thank the rapporteurs for the budget, Mrs Neena Gill and Mr Jan Mulder, for their excellent and constructive work. My group, the Group of the European Liberal, Democrat and Reform Party, is proud that Mr Jan Mulder, who is one of our members, is general rapporteur. For that we particularly want to thank the Group of the European People’s Party , with whom we reached political agreement on the matter at the start of this parliamentary term. I likewise want to say how highly I regard the Chairman of the Committee on Budgets, Mr Terence Wynn, and the Budgets Commissioner, Michaele Schreyer, for their friendly and expert cooperation. Next year’s is a historic budget, because for the first time it is being drafted for a Union of 25 Member States. Formally it is being made legally binding on 15 Member States, but politically the budget is to be agreed this year to apply to a Union of 25 Member States. Secondly, the budget has been drawn up as an activity-based budget. This is something the Group has been consistently calling for for a long time now. In this way we can monitor with greater accuracy the costs associated with different policy areas, how administrative expenditure relates to operational expenditure, as well as general efficiency. This is a big reform, which at the same time emphasises the importance of personal accountability, and it will create a basis for later activity-based management in the Commission. The proposal in the wake of the debate by the Committee on Budgets contains many important areas of focus. I would like to mention a few of them. With regard to agriculture, the committee gave export aid for live cattle its own separate budget heading. This means we will be in a better position to monitor this controversial activity. I think the budget heading under which appropriations are being earmarked for the development of marker vaccines is especially important. Up till now the European Union has worked on the principle that, for example, animals should not be vaccinated against foot-and-mouth disease, as this way one cannot tell whether immunity is due to the infection spreading the disease or the vaccines. It is clear, however, that vaccines also have to be used to achieve lasting prevention of animal diseases. Appropriations for rural development exceed the finance ceiling. Our group cannot support this amendment proposed by the Group, as it does not accord with good administration. It is furthermore questionable whether these funds could be used because equivalent regulations on the subject of finance are already in force. We think it inevitable that Structural Funds payment appropriations will have to be adequately increased, to prevent outstanding commitments, or RALs, from growing out of control, as they have up till now. The biggest problem with the draft budget concerns the reconstruction of Iraq. Our group cannot support the proposal by the Group of the European People’s Party to spend EUR 500 million on assisting the reconstruction of Iraq. Instead, we are prepared to support extra financing of around EUR 200 million in addition to the EUR 100 million granted in humanitarian aid. It is our opinion, however, that the main share of this – EUR 100 million approximately – should be financed out of the flexibility instrument, as otherwise Parliament’s priorities would run into trouble. There is an argument within Parliament over aid relief earmarked for organisations and bodies. The Group strongly favours doing away with it as it is in contravention of the current Financial Regulation. At the end of the day, it is a sort of favouritism. In our opinion, the European Parliament is not a committee or an agency that deals with applications for assistance or grants. That is why we should abandon this system. With these observations we support the reports by Mr Mulder and Mrs Gill.

Political group: ELDR