Mr President, ladies and gentlemen, having discussed and adopted our guidelines for Budget 2001 in the spring, we are now drafting and formulating the position we intend to take up in the conciliation procedure. This procedure will begin with a trialogue on Thursday evening, followed by conciliation on the outcome of the trialogue in the traditional meeting of delegations at the time of the Council’s first reading. This meeting is due to take place on 20 July. The new interinstitutional agreement between the European Parliament, the Council and the Commission on budgetary discipline and the improvement of the budgetary procedure, which was concluded on 6 May last, have revised our old ad hoc procedure. Our current conciliation procedure has become the centrepiece of the procedure for interinstitutional cooperation in budgetary matters. This procedure now encompasses two topics, firstly the one that was covered by our old ad hoc procedure, i.e. agricultural expenditure, including the expenditure resulting from fisheries agreements, along with the EU financed CSFP expenditure. However we should also discuss all the other expenditure; at least discuss it, even if we cannot agree. Because the conciliation procedure creates the framework that makes it possible, as it says in the interinstitutional agreement, to continue the debate on overall expenditure development and the essential features of the budget for the coming financial year in the light of Commission’s preliminary draft budget. That is precisely the stage we are at now. We are in possession of the Commission’s draft budget, and our motion will contain advice for the Council on its first reading of the budget. This advice will be clear and unequivocal. One of our main priorities was, is, and remains support for the peace and stability process in the Balkans. We asked for a multiannual programme for this as early as last year, so that the financing for this process would no longer have a hand-to-mouth existence but would be placed on a firm footing. We have already inserted a revision clause in the interinstitutional agreement to this end, in conjunction with the Council and the Commission. In addition, as early as December last year, we drew up a joint declaration, together with the Council, during our last second reading. Accordingly, the Commission has now presented a proposal for revision of the financial perspective and for a multiannual programme for the Western Balkans. It has also submitted a preliminary draft budget based on the revision of the financial perspective. We welcome this initiative from the Commission, because we believe that it is absolutely vital to revise the financial perspective if we are to honour the commitments entered into by the European Union in the Balkans. However we do not think that we should finance our aid to Kosovo and the Balkans simply by carrying out a multiannual redeployment of our traditional priorities in external policy, and making cutbacks in our cooperation with developing countries and in the aid we deliver to the poorest of the poor. By adopting Agenda 2000 we have already agreed to a 22% cut in heading 4, albeit only on condition that the appropriations needed for Kosovo and the Balkans are financed by fresh money. Consequently, we are expecting the Council to enter into constructive negotiations with us to this end, and hope to reach a conclusion before the Council’s first reading. Permit me to make a few comments on the traditional aspects of the ad hoc procedure. We take the view that when it comes to heading 1a, i.e. agriculture, we are completely justified in waiting until the Commission has sent its Letter of Amendment before we amend the ceilings. We are delighted that the Commission has budgetised in heading 1b the full amount available under the financial perspective, and we hope the Commission will be able to make full use of it. Last year, Parliament fought tooth and nail for heading 1b. We are not so fickle as to behave any differently this year. But we certainly take a keen interest in the transformation of the nature of the appropriations for heading 1b into differentiated appropriations. As far as the fisheries agreements are concerned, we are expecting that as in previous ad hoc procedures, the Commission will submit updated, realistic figures before Parliament’s first reading that we will then be able to take into account. We think it is right and proper that the CFSP is becoming more and more of a Community policy, i.e. CFSP actions are being transferred from the Second Pillar to the First Pillar. However, we would like to press home to the Council that this must not lead to more and more cuts in the amounts available for our traditional external policy measures What we absolutely cannot agree to is the Council’s attempt to finance the Special Envoys in its own budget. The gentlemen’s agreement only applies to administrative expenditure. The expenditure for the special representative is of an operational nature. If such a step was taken without the agreement of Parliament, then we would deem this a violation of the Interinstitutional Agreement on the part of the Council. That was the advice I wanted to give the Council. There will be more in the motion that we are due to vote on tomorrow. We expect the Council to take account of our deliberations and decisions in those of its own.

Political group: PSE