European Parliament Resolution on the draft general budget of the European Union for the financial year 2000, as modified by the Council (all sections) (C5-0600/1999), and on Letters of Amendment Nos 1/2000 (11568/1999 - C5-0313/1999), 2/2000 (13482/1999 - C5-0311/1999) and 3/2000 (.../1999 - C5-.../1999) to the 2000 draft budget

A5-0095/1999

(2000/C 41/02)

The European Parliament

- having regard to Article 272 of the EC Treaty, Article 177 of the Euratom Treaty and Article 78 of the ECSC Treaty,

- having regard to the Council Decisions of 26 November 1999 on the draft budget for 2000 as amended and modified by Parliament at first reading (13476/1999 - C5-0600/1999),

- having regard to the Council Decision of 31 October 1994(1) on the system of the European Communities' own resources,

- having regard to its resolutions of 23 March 1999 on the guidelines for the 2000 budget(2),

- having regard to the preliminary draft budget submitted by the Commission for the financial year 2000 [COM(1999) 200],

- having regard to the draft budget established by the Council for the financial year 2000 (C5-0300/1999),

- having regard to Letter of Amendment No 1 to the draft budget for 2000 (11568/1999 - C5-0313/1999),

- having regard to Letter of Amendment No 2 to the draft budget for 2000 (13482/1999 - C5-0311/1999),

- having regard to Letter of Amendment No 5 to the preliminary draft budget for 2000 (.../1999 - C5-.../1999),

- having regard to Letter of Amendment No 3 to the draft budget for 2000 (.../1999 - C5-.../1999),

- having regard to its resolutions of 28 October 1999 on the draft budget for 2000(3),

- having regard to the Interinstitutional Agreement of 6 May 1999 between the European Parliament, the Council and the Commission on budgetary discipline and improvement of the budgetary procedure(4),

- having regard to the Commission proposal for a European Parliament and Council decision revising the financial perspective annexed to the Interinstitutional Agreement of 6 May 1999 on budgetary discipline and improvement of the budgetary procedure (1999/0211 ACI - C5-0322/1999),

- having regard to the report of the Committee on Budgets and the opinion of the Committee on Agriculture and Rural Development on Letter of Amendment No 4/2000 to the preliminary draft budget for the financial year 2000 (A5-0095/1999),

A. whereas it is determined to ensure that the 2000 budget provides funding for the new priorities set for the Union in the field of external action, in accordance with the Interinstitutional Agreement of 6 May 1999, with particular regard to paragraph 19 thereof, and the declaration annexed to that Agreement, which explicitly provide for a revision of the financial perspective to take account of reconstruction work in Kosovo, once the needs have been ascertained and estimated,

B. whereas Parliament is seeking to achieve two goals in connection with the funding of reconstruction work in Kosovo, namely:

- to determine a reasonable amount to enter in the 2000 budget as part of a long-term effort, on the basis of an accurate, realistic and multiannual estimate of requirements and the share of the overall effort which should be borne by the EU,

- to agree with the Council to raise the ceilings in heading 4 by means of a multiannual revision of the financial perspective, with a view to funding new requirements in Kosovo and the Balkans, on the understanding that the funding of such new responsibilities must not be detrimental to the Union's traditional priorities,

C. whereas the proposal for a revision of the financial perspective submitted by the Commission would entail the ceiling for heading 4 being exceeded in the 2000 financial year alone,

D. whereas the appropriations which the Commission is proposing be earmarked for reconstruction in Kosovo are not based on an accurate, reliable assessment of requirements, nor are the estimates for the medium-term requirements in the Balkans as a whole; whereas, however, the Commission will apparently be able to provide more trustworthy estimates at the end of the first quarter of 2000,

E. whereas the Council has failed to take a firm stand on a clear, quantified and multiannual budgetary commitment on Kosovo and the Balkans,

F. whereas, however, it is the responsibility of the two arms of the budgetary authority to agree on the granting of the necessary funds for reconstruction work in Kosovo for the 2000 financial year pending a realistic multiannual assessment of funding requirements for Kosovo and the Balkans as a whole;

G. Whereas the proposal for a decision adopted by the Council at its meeting of 15 December 1999, after the vote on amendments at second reading by the Committee on Budgets, seeks to provide funding for expenditure in respect of Kosovo in excess of the ceiling for heading 4:

- by making use of the flexibility instrument provided for under paragraph 24 of the Interinstitutional Agreement of 6 May 1999,

- providing for a redeployment of EUR 40 million,

- leaving a margin of EUR 20 million under heading 4,

- reducing payment appropriations,

- initiating a revision of the financial perspective if estimated requirements for Kosovo and the Balkans are significantly higher than the amounts earmarked under existing programmes,

The priorities

1. Deplores the fact that the Commission did not show greater rigour and foresight in its proposals, particularly in respect of the planning of funding requirements for Kosovo, and that those proposals are not realistically based on reliable, confirmed needs; notes with satisfaction that the Council proposal to exceed the ceiling for heading 4 of the financial perspective goes beyond the Commission proposal referred in recital C,

2. Notes in particular that, while the estimates put forward by the Commission refer to the conclusions of a World bank study of foreseeable requirements in the region, they are not based on an accurate assumption of the overall volume of such needs, how long the effort needs to be maintained, the share to be borne by the European Union, the Member States and the other donors and the ability of a region with a gross national product which, according to the most optimistic assessments, stands at less than EUR 800 million, to take up such funding;

3. Notes that, in connection with funding for the Balkans, the President of the Commission has exhibited a willingness to pledge EUR 5,5 billion from the EU over a seven-year period, but that the Commission considers that it will be unable to make a satisfactory assessment of requirements before April 2000;

4. Notes that the information provided by the Commission concerning revenue is included neither in Letter of Amendment No 4/2000 to the preliminary draft budget nor in Letter of Amendment No 2/2000 to the draft budget; points out that the surplus available from the previous year - the 1999 budget balance - can only be included in the budget by means of an amending and supplementary budget in agreement with Parliament following finalisation in accordance with Article 32 of the Financial Regulation;

5. Notes that the Council's proposal that the funding required for Kosovo, which was initially set at EUR 500 million for 2000, be divided between the 2000 financial year (EUR 360 million) and the 2001 financial year (EUR 140 million) and that part of the reconstruction effort in 2000 be funded by means of carry-overs from 1999 is not based on a fully satisfactory analysis of requirements, the appropriate timetable and the responsibilities to be taken on by the Union;

6. Accepts, despite the additional efforts required, the draft compromise proposed by the Council to provide funding of EUR 360 million in 2000 for reconstruction work; decides accordingly to leave a margin of EUR 20 million below the ceiling for heading 4 and undertakes if necessary to redeploy appropriations to an amount of EUR 40 million;

7. Accepts, with a view to taking its proper part in the efforts to achieve rigour, that the future fisheries agreement with Morocco and the requirements identified in East Timor and Turkey should be funded within the current financial perspective by means of redeployment of the appropriations entered under heading 4 (External action) of the budget;

8. Reiterates its wish to see the pre-accession appropriations for Cyprus and Malta entered under subsection B7 (Pre-accession); however, owing to the Council's refusal to agree to this, enters the necessary appropriations under heading 4, so as not to penalise the countries concerned;

9. Will await the assessment of funding requirements in Kosovo and the Balkans as a whole, which the Commission has indicated that it will be able to produce by April 2000, before determining:

- the overall volume of funding to be committed to Kosovo and the Balkans as a whole between 2000 and 2006,

- the share of such funding to be borne by the European Union,

- the total appropriations which are not covered by the existing programmes and which will therefore call for a raising of the ceiling for heading 4;

10. Emphasises its determination to take appropriate action on the assessment and the Commission proposal at the earliest opportunity, and by April 2000 at the latest, by negotiating with the other arm of the budgetary authority an appropriate revision of the financial perspective in respect of heading 4 in accordance with the declaration annexed to the joint decision(5);

11. Takes the view that the requirements under Article 14 of the Financial Regulation are substantiated for the changes to lines against subheading 1a and headings 5 and 7, which were introduced by Letters of Amendment Nos 1 and 2 to the 2000 draft budget and have been accepted unamended; considers that the requirements of Article 14 of the Financial Regulation have not been met for lines against subheading 1b and heading 4, however, and rejects those parts of Letter of Amendement No 2 to the 2000 draft budget on the ground hat, as regards those headings, "very exceptional circumstances" have not been adduced;

TAOs: genuine reform under way

12. Welcomes the Commission's positive reaction to Amendment 460 and the constructive attitude it has shown to the need for reform; endorses Vice-President Kinnock's decision to make technical assistance a central issue in the administrative reform process; points out, furthermore, that the Council has approved the move to identify administrative expenditure within the budgetary nomenclature;

13. Considers that the assurances given in connection with the implementation of the principles advocated by Parliament, namely the phasing-out of the TAOs, the drawing up of a list of tasks that may be delegated, and the setting up of Decentralised Implementation Units (DIUs) supervised by regular staff from the Commission, who come under its authority, are now credible in that they are converted by a precise and transparent timetable;

14. Proposes therefore to release the reserve of 90 % of the appropriations for technical assistance and administrative expenditure which was set aside at first reading and to transfer 10 % of administrative appropriations to operational headings, with a view to prompting the Commission to adopt more rigorous management procedures; is keeping 10 % of the administrative appropriations for heading 4 lines in the reserve, pending provision of information to the budgetary authority on present contracts;

15. Reserves the right to make a comprehensive appraisal of the action taken by the Commission in this connection before the vote at first reading on the 2001 budget;

Headings 1, 3, 4 and 5

16. Welcomes the fact that agreement has been reached with the Council on some of the points covered by Letter of Amendment No 2 to the 2000 draft budget, with particular reference to subheading 1a; in this connection, welcomes the Council's decision to accept that funding of EUR 50 million be provided for consumer protection without any cut in the appropriations earmarked for the distribution of food products to disadvantaged persons;

17. Notes that most of the amendments adopted at first reading have not been taken up by the Council; draws attention to the need to ensure that the level of payment appropriations to be entered in the budget is compatible with the level of commitment appropriations;

18. Deplores the fact that the Council has rejected certain pilot projects and preparatory actions for which the appropriations were entered by Parliament in full compliance with the Interinstitutional Agreement of 6 May 1999; points out, furthermore, that, when sifting pilot projects and preparatory actions, the Council agreed to delete the measures it itself entered at first reading to assist employees of firms affected by the discontinuation of the duty-free system;

19. Confirms its first-reading decisions with regard to the appropriations to be entered for the Union's external actions, but has been obliged to redeploy EUR 150 million to permit funding of new needs in East Timor, Turkey, Cyprus and Malta, and of the fisheries agreement with Morocco; has endeavoured to conduct this redeployment without sacrificing any of Parliament's basic priorities and while taking account of the reassessment of the needs set out in Letter of Amendment No 4 to the 2000 preliminary draft budget;

20. Welcomes also the Council's agreement to allocate 75 new posts intended for OLAF and the creation of an appropriate structure within the budget; points out, lastly, that the Council has approved conversion of the Sapard pre-accession instrument into differentiated appropriations, albeit without quantifying what the payments reduction means;

Other institutions

21. Notes Letter of Amendment No 3/2000, adopted by the Council, to the 2000 draft budget, and voices its full endorsement of that letter of amendment;

22. Instructs its Secretary-General to adjust the new staff promotion policy to take account of the shortcomings noticed so far, in particular concerning promotion possibilities for the lowest grades in each category;

23. Considers that the new mobility policy for staff in the A grades is in principle a useful means of making Parliament's Secretariat more dynamic, but stresses that unless professional training in specialised areas such as the environment, transport and agriculture is stepped up, there will be a huge loss of human capital; instructs its Secretary-General to submit a report by 31 March 2000 proposing the action intended to overcome this loss of human capital in the short- and medium-term;

24. Emphatically underscores the fact that mobility, promotion and assessment policy must form a coherent whole; insists that promotions, in particular of A1 and A2 grades, must be based strictly on professional performance and on personal and managerial skills; expects its Secretary-General to submit a report by 31 Marc 2000 on the coherent implementation of mobility, promotion and assessment policy; expects in particular that, in the area of assessment policy, the training of assessors, the assessment criteria and the scope for officials, for their part, to assess their assessors will also be addressed;

25. Is in favour of the continuation of the agreement between the Ombudsman and the Parliament on administrative, financial and logistical matters; stresses that although the Ombudsman's budget will become an independent section of the general budget of the Communities as from the 2000 budget onwards, this should not involve increased staffing in the areas of administration, budgets and finances;

26. Instructs its President to designate the budgetary act as the "Budget of the European Union";

27. Instructs its President to forward these budgetary decisions to the Council, the Commission and the institutions and advisory bodies concerned.

(1) OJ L 293, 12.11.1994.

(2) OJ C 177, 22.6.1999, pp. 40 and 44.

(3) "Texts adopted" of that sitting, Items 1 and 2.

(4) OJ C 172, 18.6.1999, p. 1.

(5) See Item 7.