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Vol. 1983/02 59 
  
 
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In accordance with Council Regulation (EEC, Euratom) No 354/83 of 1 February 1983 
concerning the openi ng to the public of the historical archives of the European Economic 
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In Übereinstimmung mit der Verordnung (EWG, Euratom) Nr. 354/83 des Rates vom 1. 
Februar 198 3 über die Freigabe der historischen Archive der Europäischen  
Wirtschaftsgemeinschaft und der Europäischen Atomgemeinschaft (ABI. L 43 vom 15.2.1983,  
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COMMUNAUTES EUROPEENNES
S e c r é t a r i a t  g é n é r a lCOM(83) 729 final
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DOCUMENT INTERNE
B U D G E T A R Y  P L A N N IN G  A N D  B U D G E T A R Y  P R O C E D U R E S
(Communication from the Commission to the Council)
C 0M (83) 729 final

BU D G ETA RY  P L A N N IN G  AND BU D G ETA RY  P R O C E D U R E S
REFLEXIONS DE LA COMMISSION
In the light of certain of the concerns expressed  
in the discussion in the Special Council, notably the note presented  
by the Netherlands Delegation on the 16 September, the Commission  
presents the following reflections on the improvement of the  
Community's budgetary planning and procedures.
As the overall size of the Community Budget grows,  
so too does the importance of achieving greater clarity and  
predictability over its medium-term development. The decisions  
by the Budget Authority on each year's annual Community budget  
must be taken against a background of adequate prior consensus  
on the Community's priorities. Programmes whose effects can  
only be realised over a number of years need to be assured of  
a continuing availability of Community support. National governments  
in turn must have a clearer medium-term picture of the nature  
and scale of the financial effort which the Community Budget  
is likely to be .called upon to undertake.
It therefore seems appropriate to the Commission to  
envisage certain practical improvements to the present budgetary  
procedures. The purpose of the improvements would be to tighten 
up budgetary discipline b y  more accurate E C  ’  budget forecasting in 
order to keep  the volume of'the b u d g e t  and its medium-term growth 
u n d e r  control while at the sam e time not altering the Treaties and 
respecting the prerogatives of each of the Institutions concerned.
The improvements in question would be based on the  
more systematic use of two existing instruments, namely:
1. The further promotion in appropriate cases of the idea of  
multiannual programming, involving an agreement between
the Council and the Parliament (on the basis of a proposition  
from the Commission) on an estimated overall budgetary envelope  
for certain actions over a medium- to long-term timescale.
2. A more focussed presentation by the Commission, as a separate  
precursor to the tabling of its preliminary draft budget,
of the triennial forecasts of both revenue and expenditure.
These forecasts should be discussed by both the Council  
and Parliament, who should be invited to express a view  
on them within a fixed timescale. In the case of the Council,  
an appropriate formation for the discussion of the triennial  
forecasts would be a combined meeting of Foreign and Finance  
Ministers, which, it has in the past been suggested, should  
each year address the question of the Community's policy  
and budgetary priorities. In the case of the Parliament  
such discussion might form the background to the annual  
"guidelines" resolution.

2
MULTIANNUAL PROGRAMMING
A number of the Community's expenditure areas are already  
subject to some kind of multiannual programme or indicative  
guideline:
(a) FEOGA Guarantee expenditure will, if the Commission proposal  
is accepted, be subject to a qualitative guideline linked to  
the growth of the Community's own resources.
(b) Most actions in the fields of research and development, energy,  
industry and transport already take place within a legislative  
framework which indicates the amount estimated necessary for  
the accomplishment of the programme over a certain medium- to  
long-term period.
(c) For the structural funds, the Commission has proposed both an  
overall guideline rate of growth (that they should double  
overall in real terms in five years) "together with, in the  
case of FEOGA Guidance, Fish and the Integrated Mediterranean  
Programmes, indicative estimates of the total amounts required  
for a multiannual period.
(d) The administrative and other miscellaneous expenditure under  
the Budget is in any case relatively stable in its incidence.
The Commission is proposing that greater use be made, where  
appropriate, of multiannual planning. The nature of the plans in  
question would vary according to the nature of the action involved.
In some cases it would be appropriate to enter the sums considered  
necessary in the basic regulations. In others it would be a question,  
rather, of laying down guidelines for the relative increase in real  
terms of certain categories of expenditure. In order, however, to  
prevent all the expenditure predetermined to a greater or lesser  
extent by multiannual programmes included in regulations from making  
the European Parliament's powers with regard to non-compulsory  
expenditure hollow, legislative concertation would need to be carried  
further, so as to have the sums considered necessary agreed on jointly  
by the twin holders of budget authority. The Council should be  
prepared to enter into a constructive concertation with the Parliament  
in order to achieve this.

-  3  -
On.the other hand, with regard to the European Par Li ament's  
margin of manoeuvre, it would be.reasonable to'ask it to make very  
prudent use of this, particularly wherein entering in its draft  
budget the sums actually needed, the Council has, followed such  
legislative decisions.
TRIENNIAL FORECASTS
i--- Pursuant to the Council decision of 21 April 1970, the
Co
mmission has drawn up multiannual estimates every year (except in  
1974 for the period 1975-77 and in 1982 for the period 1983-85). The  
^Economic Policy Committee has examined them. The budget authority has  
generally ignored them completely. Thus, effect has never been given  
to Articles 2 and 3 of the decision.
The Commission now proposes, in the context of a greater use  
of the technique of multiannual programming, to bring forward  
its triennial forecasts, covering both revenue and expenditure,  
before the presentation of its preliminary draft budget, with  
a view to promoting a serious discussion of them by the two  
halves of the Budgetary Authority.
On the revenue side, the forecasts would provide the  
most recent estimates of the total own resources potentially  
available to the Community for the following three years, together  
with an indication, in respect of the immediately following  
year, of the yield of the application of the full maximum rate.
On the expenditure side, the forecasts would be limited  
to the main categories of expenditure:
- For FEOGA Guarantee they would show the implication of a growth  
rate in conformity with the qualitative guideline which the  
Commission has proposed (i.e. limitation to within the growth  
rate of own resources expressed on the basis of a rolling  
three-year average), accompanied by such comments on the conjunc-  
tural situation as the Commission thought it right to make
(but bearing in mind that the Commission would not at this  
stage have taken any final decision on its proposals in respect  
of FEOGA Guarantee in the preliminary draft budget).
- For the Structural Funds, forecasts would show, in terms of  
both existing and new commitments, the effect of the  
application of any overall guideline which previously had  
been agreed.
./·

-  4  -
- For sectoral policies, the forecasts would set out the budgetary  
implications of the appli£értion ■  · ·  of whatever multiannual  
programmes had been agreed, together with an indication t  <?f; the 
'PJ?der of„jnagnitude, not necessarily precieelyjjuantified, ,of > r  
such new policy initiatives with expenditure'lmplications as
the Commission envisaged bringing^forward before the next budget year.
- For administration, development and other expenditure, the  
forecasts would show whatever prospective rate of spending
the Commission judged appropriate in the light of the circumstances.
The Commission envisages presenting these forecasts,  
which will need to be revised and updated annually in the early  
months of each year, well in advance of the start of the budget  
procedure as such, the first formal act of which is the presentation  
by the Commission in May of its preliminary draft budget for  
the following year._ The Commission would expect its forecasts to i  
be examined by the Council and Pa A  i ament separately, with a  
'conciliation meeting if agreement ^bulcT not t>ë reactrecF, If after  
“ 'sücIT'â"mëëïTrigÿ'.èhfe're was stiTlT;i3c  aiiagreement between the Council  
and Parliament, ttië Commission would still 'give  full consideration  
to whatever lessons it was able to draw.
In the case of the Council, consideration of the triennial  
forecasts could appropriately take place in the framework of  
the Joint Council of Foreign and Finance Ministers which, it  
has been suggested by the Dutch delegation, should meet early  
in each year to discuss the Community's budgetary priorities.
Although the past results of meetings of this kind have been  
disappointing, the Commission believes that, in the context  
of a more structured development of the Community's budgetary  
planning, such Joint Councils could in future play a valuable  
rôle. It might be that some Member States might want to use  
them as an occasion to offer a view on the overall level of  
VAT rate which they considered appropriate for the following  
budgetary year.
In the case of the European Parliament consideration  
of the forecasts might take place in parallel with the elaboration  
of the budgetary guidelines resolution which Parliament has  
in recent years adopted in the early part of the year.

CONCLUSION
The Commission therefore would see advantage, with a view  
to improving the Community's procedures for budgetary planning  
and control, in the adoption by the Council, the Parliament and  
the Commission of the following texts:
First text
At the beginning of each budget year the Commission is to draw up  
proposals for 3-yearly estimates for the revenue and expenditure  
to be included in the general budget of the European Communities  
for the following three budget years, the estimate for the  
immediately following year (n + 1) being intended to serve as the  
basis for the preparation of the preliminary draft budget it  
presents on 15 June.
The Council and the Parliament are to examine the Commission's  
proposed 3-yearly estimates and to state their views within six  
weeks of receiving them. The procedure according to;which the  
Parliament's and Council's opinions are delivered must be such  
as to supply a clear guide as to the lines of conduct to be laid  
down for the Commission for the preparation of its preliminary  
draft budget. If the Commission finds any substantial differences  
between the Council's and Parliament's positions, it is to ask for  
a conciliation meeting, to be held within the following fortnight  
once both the opinions are to hand.
Second text
If the sum considered necessary to carry out the programme (operation)
is to be stated in the regulation, such sum must be agreed on by
the Council and Parliament (in the case of non-compulsory expenditure).