Amending letter no 1 to the preliminary draft budget 2009 statement of expenditure by section - Section III - Commission
Date: 2008-09-10
Institutions: Directorate-General for Budget, European Commission
Subjects: EU aid, EU expenditure, EU office or agency, European Commission, Georgia, Kosovo, Palestine question, amending budget, operation of the Institutions, preliminary draft EC budget

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COMMISSION OF THE EUROPEAN COMMUNITIES 

Brussels, 10.9.2008 
SEC(2008) 2435 

AMENDING LETTER No 1 
TO THE PRELIMINARY DRAFT BUDGET 2009 

STATEMENT OF EXPENDITURE BY SECTION 
Section III - Commission 

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AMENDING LETTER No 1 
TO THE PRELIMINARY DRAFT BUDGET 2009 

STATEMENT OF EXPENDITURE BY SECTION 
Section III - Commission 

Having regard to: 

– 

– 

– 

the  Treaty  establishing  the  European  Community,  and  in  particular  Article 272 
thereof, 

the  Treaty  establishing  the  European  Atomic  Energy  Community,  and  in  particular 
Article 177 thereof, 

Council Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial 
Regulation  applicable  to  the  general  budget  of  the  European  Communities1,  as  last 
amended  by  Council  Regulation  (EC,  Euratom)  No  1525/20072,  and  in  particular 
Article 34 thereof, 

the  European  Commission  hereby  presents  to  the  budgetary  authority  the  amending  letter 
No 1  to  the  Preliminary  Draft  Budget  for  2009  for  the  reasons  set  out  in  the  explanatory 
memorandum. 

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OJ L 248, 16.9.2002, p. 1. 
OJ L 343, 27.12.2006, p. 9. 

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TABLE OF CONTENTS 

1. 

2. 

2.1. 

2.2. 

3. 

3.1. 

3.2. 

4. 

5. 

6. 

7. 

8. 

8.1. 

8.2. 

9. 

Introduction .................................................................................................................. 4 

Kosovo ......................................................................................................................... 4 

Background .................................................................................................................. 4 

Budget lines, legal bases and remarks.......................................................................... 6 

Palestine ....................................................................................................................... 6 

Background .................................................................................................................. 6 

Budget lines, legal bases and remarks.......................................................................... 9 

Food Aid..................................................................................................................... 10 

Georgia....................................................................................................................... 10 

Effect on the heading 4 margin .................................................................................. 10 

Consular cooperation ................................................................................................. 11 

Education, Audiovisual and Culture Executive Agency (EACEA)........................... 11 

Set-up and extensions................................................................................................. 11 

Budgetary implications .............................................................................................. 12 

Executive Agency for the Public Health Programme (PHEA) and Trans-European 
Transport Network Executive Agency (TEN-T EA) ................................................. 13 

SUMMARY TABLE BY HEADING OF THE FINANCIAL FRAMEWORK ..................... 15 

STATEMENT OF EXPENDITURE BY SECTION 

The statement of expenditure by section is forwarded separately via the SEI-BUD system. An 
English  version  of  the  expenditure  by  section  is  attached  for  information  as  a  budgetary 
annex. 

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1. 

INTRODUCTION 

The  Amending  Letter  No  1  (AL  1)  to  the  Preliminary  Draft  Budget  for  2009  (PDB  2009) 
covers the following: 

–  the  mobilisation  of  new  funds  for  an  amount  of  EUR 40 million  in  commitment 

appropriations to support the stability and development of Kosovo; 

–  the mobilisation of additional funds for an amount of EUR 139 million in commitment and 

EUR 180 million in payment appropriations to support the Palestinian Authority. 

–  the creation of a new budget article 19 06 06 Consular cooperation; 

–  the  budgetary  adaptations  arising  from  the  extension  of  the  mandate  of  the  Education, 
Audiovisual and Culture Executive Agency (EACEA) to Tempus and ICI programmes; 

–  the lifting of the reserves entered in the 2009 preliminary draft budget after approval of the 
extensions  of  the  Executive  Agency  for  the  Public  Health  Programme  (PHEA),  and  the 
Trans-European Transport Network Executive Agency (TEN-T EA). 

2. 

KOSOVO 

2.1. 

Background 

Kosovo has  been  under United Nations (UN)  administration  since  1999 on the  basis of UN 
Security Council Resolution 1244 (UNSCR). On 17 February 2008, the assembly of Kosovo 
adopted  a  resolution  declaring  Kosovo  an  independent  and  sovereign  state.  Kosovo's 
constitution came into force on 15 June. To date, Kosovo's independence has been recognized 
by 46 members of the UN and 21 European Union Member States. 

On  12  June  2008,  the  UN  Secretary  General  issued  his  proposals  to  reconfigure  the  United 
Nations  Mission  in  Kosovo,  acknowledging  the  need  for  the  UN  to  adjust  the  operational 
aspects of the international presence in Kosovo and the European Union's readiness to play an 
enhanced role in Kosovo as reflected in the Council Conclusions of 14 December 2007. The 
reconfiguration  process  should  be  completed  by  the  autumn  of  2008.  UNSCR  1244  will 
continue to apply until further notice. 

The  Commission's  Communication  on  the  Western  Balkans  issued  on  5  March  20083 
confirmed  Kosovo's  clear  and  tangible  European  Union  perspective  and  the  Commission's 
intention  to  support  its  institution-building  and  development,  and  to  organise  a  Donors' 
Conference to mobilise funding to address Kosovo's most pressing needs. 

The  2008  June  European  Council  confirmed  its  conclusions  of  December  2007  and  the 
General  Affairs  and  External  Relations  Council  (GAERC)  conclusions  of  February  20084, 
stating that the European Union remained committed to playing a leading role in ensuring the 
stability of Kosovo. The Council welcomed the UN Secretary General's report facilitating the 

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COM(2008) 127. 
Council of the European Union, document 11018/08 of 20.6.2008. 

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deployment of a European security and defense policy (ESDP) rule of law mission (EULEX) 
throughout Kosovo and allowing for an enhanced operational role of the European Union in 
the  area  of  rule  of  law.  The  Council  also  expressed  its  support  to  the  Donors'  Conference 
which was organised by the Commission and took place on the 11th July 2008 and recalled its 
willingness  to  assist  the  economic  and  political  development  of  Kosovo  through  a  clear 
European perspective.  

In  preparation  for  the  conference,  the  Kosovo  authorities,  with  the  assistance  of  the 
International  Financial  Institutions  (IFI)  and  the  Commission  have  established  a  Medium-
Term  Expenditure  Framework  (MTEF)5  for  the  years  2008-2011,  which  incorporates  all 
foreseeable public revenue and expenditure. In addition, detailed sectoral strategy papers have 
been drafted on areas such as education, transport, and rule of law. This documentation was 
presented and discussed at the Conference and served as a basis for pledging by participants 
to  fill  an  identified  gap  of  some  EUR  1.4  billion,  of  which  EUR  approximately  1  billion  is 
estimated to be required for socio-economic development. This gap is being addressed by the 
European Union, the USA, but also individual European Union Member States, IFIs and other 
bilateral donors.  

Total  pledges  made  at  the  conference  amounted  to  EUR  1,236  million,  of  which  EUR  102 
million were for the stabilisation reserve6. In line with its political commitment that Kosovo is 
a  profoundly  European  matter,  the  European  Union  in  its  entirety  pledged  2/3  of  the  total 
collected. 

In  addition  to  EUR  285  million  from  Member  States,  the  Commission  pledged  EUR  508 
million,  composed  of  some  EUR  358  million  from  the  Instrument  for  Pre-Accession 
Assistance (IPA) and a further EUR 150 million in Macro-Financial Assistance (MFA). This 
pledge  is  conditional  to  the  Kosovo  government's  commitment  to  the  sound  and  efficient 
management  of  donated  funds  and  the  implementation  of  agreed  policy  reforms.  It  is  also 
subject to sufficient budgetary appropriations being voted by the Budgetary Authority as the 
European Union pledge currently stands above the current financial programming for Kosovo 
by  EUR  100  million  as  some  EUR  408  million  are  programmed  under  IPA  and  Macro 
Financial  Assistance  funding  (MFA)  over  the  period  2008/20107.  Thus  the  Commission 
intends to increase the amounts foreseen for Kosovo in the financial programming by some 
EUR 100 million to meet the EUR 508 million pledging target.  

In  order  to  minimize  the  impact  of  additional  funding  for  Kosovo  on  the  limited  margin 
foreseen for 2009, the  Commission  is  requesting  EUR  40  million  as  additional  front-loaded 
assistance  under  the  2009  budget.  This  amount  is  to  be  directed  towards  development 
assistance via IPA. The remaining EUR 60 million would stem from internal redeployments 
within heading 4 that will be transferred to the IPA programme already in 2008; this would 
also mean a faster translation of pledge into reality for the development of Kosovo.  

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The  International  Monetary  Fund,  in  its  Letter  of  Assessment  (on  the  MTEF  and  accompanying 
policies)  gave  a  broadly  positive  assessment  on  the  macroeconomic  policy  framework  for  the  period 
2008/2011. 
To build up a contingency reserve for instance for expenditure related to debt obligations which Kosovo 
may inherit. 
EUR 258  million  are  already  programmed  under  the  Instrument  for  Pre-Accession  Assistance  (IPA) 
over  the  three-year  period  covered  by  the  MTEF,  and  EUR 150 million  are  still  available  as  macro-
financial assistance (MFA). 

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Should  additional  funding  for  Kosovo  become  available,  the  Commission  would  want  to 
mobilise grant funding to address the substantial infrastructure needs identified in the MTEF. 
The  IPA  Infrastructure  Preparation  Facility  is  indeed  rapidly  building  a  track  record  in 
financing preparatory activities for sizeable investment projects in Kosovo. The absorption of 
such  grant  funding  would  be  ensured  in  close  cooperation  with  the  relevant  International 
Financial  Institutions.  By  way  of  follow-up,  the  government  of  Kosovo  is  committed  to 
establish,  within  the  next  3  months,  a  coherent  framework  for  donor  coherent  coordination 
that fully takes account of Kosovo’s European integration ambitions.  

The  Authorities  will  also  develop  and  implement  a  comprehensive  action  plan  to  improve 
budget management, including in the areas of internal control and audit, to integrate better the 
capital  and  current  budget,  and  to  accelerate  the  execution  of  the  public  investment 
programme  by  raising  the  capacity  to  plan,  prioritise,  implement  and  monitor  public 
investment. The Authorities will take account of last year’s Public Expenditure and Financial 
Accountability (PEFA) Assessment Report, which concluded that ‘the level of fiduciary risk 
is low enough for external partners to consider budget support for Kosovo. 

2.2. 

Budget lines, legal bases and remarks 

The global amount needed (EUR 40 million in 2009) will be included under article 22 02 02 
"Transition  and  institution-building  assistance  to  potential  candidate  countries"  of  title  22 
"Enlargement", chapter 02 "Enlargement process and strategy".  

Article 22 02 02  Transition  and  institution-building  assistance  to  potential  candidate 
countries 

Figures 

Appropriations PDB 2009 

Amending Letter No 1 

New amount 

Commitments 

Payments 

Commitments 

Payments 

Commitments 

Payments 

429 330 000 

225 489 000 

40 000 000 

469 333 000 

225 489 000 

As  already  mentioned,  EUR  40  million  in  commitment  appropriations  are  requested  as  a 
front-loaded assistance under the 2009 budget.  

3. 

PALESTINE 

3.1. 

Background 

As  measured  in  mid-year  2008,  the  overall  economic  and  social  trends  in  the  occupied 
Palestinian territory are in decline over the expectations formulated at the end of 2007. The 
Palestinian  Donors´  Conference  held  in  December  2007,  co-chaired  by  the  Commission, 
stressed  the  shared  responsibility  for  Palestinian  economic  growth  of  the  Palestinian 
Authority  (PA)  (as  described  in  the  Palestinian  reform  and  Development  Plan  2008-2010), 
Israel  (for  lifting  restrictions  on  movement  and  access)  and  the  donor  community  (financial 
assistance).  According  to  the  May  2008  World  Bank  report  for  the  Ad  Hoc  Liaison 
Committee (AHLC), “the virtuous cycle of economic growth arising from parallel actions by 

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the PA, Israel and the donors has not been realised”.8 As a result, the actual GDP growth for 
2008  will  be  much  lower  than  projected  in  the  Palestinian  Reform  and  Development  Plan 
(3.5 %), and possibly only around 1 % (still under the assumption that there will be a slight 
reduction of the restrictions during the second part of the year). At this stage, the growth rate 
for  2009  forecast  by  the  International  Monetary  Fund  (IMF)  is  3,6 %,  but  this  also  will 
probably have to be reviewed downward. 

While  the  PA  pursued  its  reform  programme  and  donors  have  provided  generous  financial 
contributions,  restrictions  by  the  Government  of  Israel  on  Palestinian  movement  and  access 
continue to weigh heavily on the Palestinian economic outlook. The small reduction of a few 
checkpoints  in  the  West  Bank  did  not  create  the  necessary  freedom  of  movement.  The  five 
crossing points to transfer commercial goods use a back-to-back cargo transfer system, which 
is unlikely to accommodate a significantly higher volume of traffic. The prospect of opening 
the Gaza crossings, including Karni considered the lifeline for the Gazan economy, remains 
uncertain following the truce between Israel and Hamas in June 2008. Current flows to Gaza 
are limited to humanitarian supplies and fuel.  

Other economic indicators in the occupied Palestinian territory have also deteriorated further. 
Unemployment stood at nearly 23 % in 2007, up from only 10 % before the beginning of the 
Second Intifada. The unemployment rate is the highest in Gaza, at nearly 33 % of the active 
work force, and at 19 % in the West Bank. 70 % of households in Gaza and 56 % in the West 
Bank  live  under  the  poverty  line  (mid-2007;  source  UNDP).  In  view  of  the  strict  closure 
regime in Gaza, the current deep poverty rate is now even above the 35 % reported in 2006. 
38 %  of  the  Palestinian  population  is  food  insecure  (56%  in  Gaza)9.  Furthermore,  a  double 
digit inflation rate is foreseen for 2008.  

The deficit of the current budget of the Palestinian Authority is expected to reach USD 766 
million  in  2008.  The  PA  made  efforts  to  control  the  public  sector  wage  bill  and  reduce  net 
lending (subsidies to electricity and fuel utilities). On the other hand, the PA made an effort to 
reimburse all arrears to the private and public sector accumulated over the period 2006-2007 
by the Hamas-led Government. While this has led to extraordinary financial expenses in 2008, 
the early repayment of all arrears will decrease the burden on PA’s expenditure in 2009 and 
2010.  

Rationale for Community intervention 

It is difficult to estimate the precise overall needs in 2009 at this stage, especially with regard 
to recurrent expenditures. The IMF will make its revised forecast known only before the next 
Ad  Hoc  Liaison  Committee  meeting  planned  for  22  September.  A  number  of  contextual 
factors  need  to  be  taken  into  account,  in  particular  uncertainties  about  the  outcome  of  the 
political  process  launched  in  Annapolis  by  the  end  of  2008,  possible  delays  in  organising 
Palestinian  presidential  elections  scheduled  for  January  2009,  and  prospects  for  substantial 
changes on the ground, in particular with regard to movement and access restrictions, which 
have major implications for economic activity.  

If  the  current  pattern  of  developments  continues,  the  Commission  expects  for  2009  the 
situation  to  remain  stable  or  marginally  improve  in  the  West  Bank,  but  probably  worsen 

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Implementing  the  Palestinian  Reform  and  Development  Agenda,  Economic  Monitoring  Report  to  the 
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WFP/UNRWA/FAO survey on food security in the Occupied Palestinian Territories. 

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further  in  the  Gaza  Strip.  Therefore,  the  needs  of  the  Palestinian  population  are  likely  to 
remain high.  

In view of the current situation and high needs set out above and considering the large deficit 
of  the  PA,  pressure  for  external  assistance,  in  particular  from  the  European  Union,  as  the 
largest donor to the Palestinians, will remain high.  

The Action Strategy launched in November 2007 in the context of the Annapolis process put 
a  major  focus  of  the  European  Union’s  commitment  on  assisting  Palestinian  state-building 
efforts as well as providing support for the transition period. The General Affairs and External 
Relations  Council  (GAERC)  of  May  200810  confirmed  that  “the  EU  remains  committed  to 
assisting  Palestinian  state-building  efforts  across  a  broad  range  of  areas”  and  stressed  “the 
need to deliver  on pledges  made  at the International Donor's  Conference  for the  Palestinian 
State in Paris last December”. 

Taking  into  account  the  above  factors,  Commission  support  to  the  Palestinians  in  2009  is 
envisaged for: 

– 

– 

– 

– 

– 

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A high level of financial assistance to the Palestinian Authority, in coordination with 
other  donors  and  international  organisations.  These  actions  will  continue  to  aim  at 
improving  the  fiscal  stability  of  the  Palestinian  Authority,  and  thereby  at 
strengthening  its  capacity  to  deliver  services  to  the  Palestinian  population  and 
enforce  law  and  order  (support  to  current  expenditure  is  foreseen  at  EUR  14 
million/month i.e. EUR 168 million per annum). 

Building the institutions of the Palestinian Authority. The target of the assistance is 
to  strengthen  the  PA  ministries  and  other  institutions  in  view  of  Palestinian 
statehood. Specific focus will be given to the Palestinian capacity building in the area 
of  civil  security  and  the  rule  of  law,  where  the  European  Union’s  major  role  was 
confirmed at the Berlin conference held in June 2008. The Commission will continue 
to  provide  funding  for  specific  projects  in  support  of  measures  launched  by  the 
Quartet Representative (Institution building, Civil Society, Rule of Law, Education, 
Health is foreseen at EUR 18 million and Twinning at EUR 2 million). 

Support to the  East Jerusalem  institutions. The status of East Jerusalem  as possible 
capital of the future Palestinian state is of paramount political importance (support to 
current expenditure is foreseen at EUR 2 million). 

Possible  measures  to  support  the  implementation  of  an  agreement  on  final  status 
issues that could be due to be finalised by December 2008. This would constitute the 
main result of the Annapolis Process supported by the European Union, although the 
detailed  needs  will  not  be  known  until  the  end  of  the  year,  in  view  of  the  secrecy 
surrounding the bilateral negotiations (no amount planned currently). 

Development projects. The Commission will continue and expand its programme of 
infrastructure  and  other  development  projects  to  support  the  implementation  of  the 
Palestinian  Reform  and  Development  Plan and  to  resume  development  activities  in 
the Gaza Strip as soon as conditions allow (support to current expenditure is foreseen 

Council of the European Union, document 9674/1/08 of 26.6.2008. 

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for infrastructure at EUR 26 million and for Gaza Business Regeneration at EUR 18 
million). 

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United Nations Relief and Works Agency (UNRWA), in its five fields of operation, 
and in particular in Gaza. Rising food prices across the countries of the region, and 
current pace of developments in Gaza point to the fact that even more people may be 
dependent on external assistance and the pressure on UNRWA is likely to increase 
(support to current expenditure is foreseen at EUR 66 million). 

The situation in the occupied Palestinian territory continues to be volatile and this makes the 
task of estimating needs in the medium term difficult. In recent years (2008, 2007 and 2006), 
the amounts allocated initially for the Palestinians were systematically below the actual needs. 
The Commission had to call on other budget lines within the Community budget to cover the 
gap.  

In 2006, the assistance to the Palestinians on “MEDA”, “Peace Agreement” and “UNRWA” 
lines  reached  EUR  222 million,  a  large  part  of  which  being  allocated  to  the  Temporary 
International Mechanism and UNRWA.  

In 2007, the assistance to the Palestinians on the ENPI budget line for Palestine, UNRWA and 
Peace  Process  (which  corresponds  to  the  “MEDA”,  “Peace  Agreement”  and  “UNRWA” 
budget lines under MEDA Regulation) was increased from an initial EUR 172 million to EUR 
447 million. 

In  2008,  the  initial  allocation  of  EUR  300  million  on  the  ENPI  budget  line  for  Palestine, 
UNRWA and Peace Process was reinforced to EUR 380 million, to respond to Prime Minister 
Fayyad’s  request  to  the  donor  community  to  fund  the  increasing  deficit  for  recurrent 
expenditures. 

In light of the need to continue a realistic level of funding in 2009, taking account of the state 
of  Palestinian  public  finances  and  the  need  for  assistance  by  the  Palestinian  Authority 
government,  the  Commission  proposes  to  increase  the  budget  line  19 08 01 02  in  2009  by 
EUR 139 million to reach EUR 300 million. 

As  regards  payment  appropriations,  the  amount  requested  in  the  PDB  (EUR  100  million) 
should also be reinforced in line with the Commitment appropriations and past execution. An 
additional EUR 180 million is estimated necessary. 

In the course of the year 2009, the Commission may, as in previous years, have to reassess the 
situation  in  view  of  budget  execution,  eligibility  of  the  different  types  of  assistance  to 
Palestine under the various budgetary instruments, and efforts made by other donors. 

3.2. 

Budget lines, legal bases and remarks 

The additional amount needed (EUR 139 million in commitment appropriations in 2009) will 
be  included  under  item  19 08 01 02  "European  Neighbourhood  and  Partnership  financial 
assistance  to  Palestine,  the  peace  process  and  UNRWA"  of  title  "External  Relations", 
chapter 19 08 "European Neighbourhood policy and relations with Russia". 

Item  19 08 01 02  European  Neighbourhood  and  Partnership  financial  assistance  to 
Palestine, the peace process and UNRWA 

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Figures 

Appropriations PDB 2009 

Letter of amendment No 1 

New amount 

Commitments 

Payments 

Commitments 

Payments 

Commitments 

Payments 

161 000 000 

100 000 000 

139 000 000 

180 000 000 

300 000 000 

280 000 000 

As  mentioned  above,  EUR 139 million  are  requested  in  order  to  satisfy  needs  for  financial 
assistance to the Palestinian Authority especially focusing on direct financial assistance to the 
government  and  institution  building  of  the  future  Palestinian  state  as  declared  during  the 
GAERC meeting in May 2008.  

4. 

FOOD AID 

As  mentioned  in  the  2009  PDB,  the  sustained  increase  of  world  food  prices  will  affect  the 
capacity of the European Union to address food aid crises. In order to cover the most pressing 
humanitarian food needs and for the European Union to meet its international obligations and 
maintain the planned burden share in respect of support to food aid, the Commission intends, 
where necessary, to make use of all budgetary instruments available, including the Emergency 
Aid Reserve.  

In addition, the Commission adopted in July 2008 a draft regulation establishing a facility for 
rapid  response  to  soaring  food  prices  in  developing  countries.  Such  a  facility  is  primarily 
aimed  at  supporting  agriculture  in  developing  countries  hence  enabling  them  to  enhance 
production levels. It will also help those countries to mitigate the negative effects of high food 
prices on the poorest.  

5. 

GEORGIA 

On  1  September  2008,  the  extraordinary  European  Council  stated  the  European  Union  is 
ready to commit itself to support every effort to secure a peaceful and lasting solution to the 
conflict  in  Georgia.  To  that  end,  a  fact  finding  mission  has  been  decided  with  the  task  of 
helping  to  gather  information  and  defining  the  modalities  for  an  increased  European  Union 
commitment on the ground, under the European Security and Defence Policy.  

The  Commission  has  already  supplied  emergency  aid  in  response  to  the  crisis.  Both  the 
European  Council  and  Parliament  have  declared  the  European  Union  should  be  prepared  to 
supply aid for reconstruction in Georgia and to support confidence building measures and the 
development  of  regional  cooperation.  The  European  Council  has  called  for  an  international 
donors  conference  to  take  place  to  assist  reconstruction  in  Georgia.  The  Commission  has 
already  started  preparations  for  such  a  conference.  Once  the  need  assessment  is  completed 
and the necessary burden-sharing among donors takes shape, the Commission will reflect the 
resulting budgetary implications in the budgetary procedure accordingly. 

6. 

EFFECT ON THE HEADING 4 MARGIN  

The combined additional needs for heading 4 amount to EUR 179 million in commitments, of 
which EUR 40 million for Kosovo and EUR 139 million for Palestine. This leaves a margin 

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under the ceiling of EUR 64 million for heading 4. The additional payment appropriations are 
EUR 180 million for Palestine. 

7. 

CONSULAR COOPERATION 

Due  to  the  increasing  significance  and  frequency  of  major  crises  in  third  countries,  the 
European  Union  institutions  and  the  Member  States  have  initiated  reflection  on  the 
reinforcement  of  their  capacity  for  crisis  response,  including  in  the  area  of  consular 
cooperation. The guidelines for the consular protection of the EU citizens in third countries, 
which  have  been  adopted  by  Council  in  June  200611,  foresee  that  the  "Commission 
delegations should be included in contingency planning. It is understood that – at the request 
of the Presidency and as appropriate – Commission delegations/representations could provide 
logistic support to Member States' missions, especially during crises." 

Based on article 20 of the TEC, concerning the protection of EU citizens not represented in 
third countries by their Member States, and on article 20 of the TEU, providing a role for the 
Commission delegations in the implementation of the TEC article, the possible actions could 
include,  for  example,  placing  personnel,  office  space  or  material  at  a  disposal  of  Member 
States'  consulates;  participation  in  the  renting  of  transport,  material  or  space;  or  logistic 
support. 

As  these  actions  could  go  beyond  the  possibilities  for  the  use  of  the  administrative  support 
expenditure  of  the  delegations,  which  is  strictly  limited  to  the  needs  of  functioning  of  the 
delegations,  the  Commission  proposes  to  create  a  specific  budget  line  19 06 06  Consular 
cooperation on the basis of article 49, §6 point d) of the financial regulation (specific powers 
of  the  Commission  under  the  Treaties),  which  would  allow  for  financing  of  potential 
operational expenditure in favour of European citizens.  

The annual amount necessary for this potential expenditure would be limited (in the range of 
EUR 50 000  to  EUR 500 000),  and  cover  actions  undertaken  in  third  countries.The  budget 
line is proposed with a token entry (p.m.) for both commitment and payment appropriations. 
If necessary a transfer could be made within chapter 19 06 Crisis response and global threats 
to security. 

8. 

EDUCATION, AUDIOVISUAL AND CULTURE EXECUTIVE AGENCY (EACEA) 

8.1. 

Set-up and extensions 

On 14 January 2005, the Commission adopted Decision 2005/56/EC setting up the Executive 
Agency for the management of Community action in the fields of education, audiovisual and 
culture (EACEA). 

The  mandate  of  EACEA  was  extended,  for  the  first  time,  by  Commission  Decision 
2007/114/EC of 8 February 2007 to include management of: 

- the new generation of programmes previously delegated to the Agency (MEDIA 2007, Long 
Life Learning (LLL), Culture, Youth in Action, Europe for Citizens);  

11 

Council of the European Union, document 10109/2/06 of 16.6.2006. 

EN 

11 

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-  the  projects  in  the  fields  of  education,  vocational  training  and  youth,  governed  by  the 
agreements  made  in  these  fields  by  the  European  Community  and  the  United  States  of 
America and Canada;  

- other programme strands, in particular the Erasmus Mundus External Cooperation Window 
(including Latin America, Asia and the Balkans).  

A second extension of the mandate of the Agency was proposed to cover the remaining files 
of the Media II programme (1996-2000). This proposal was accompanied by a request for the 
human resources required for the Erasmus Mundus External Cooperation Windows relating to 
Latin  America,  Asia  and  the  Balkans,  in  order  to  implement  the  extension  of  the  Agency's 
mandate agreed upon in 2007.  

After approval by the Committee on Executive Agencies (CREA) on 15 April 2008, and after 
the positive opinion of the European Parliament's Committee on Budgets (COBU) on 29 May 
2008,  the  mandate  of  the  Agency  was  indeed  extended  to  cover  the  remaining  files  of  the 
Media II programme (1996-2000) by Commission Decision C (2008)2554 of 12 June 2008.  

An  external  cost-benefit  study  finalised  in  April  2008  demonstrated  that  recourse  to  the 
Agency is the best solution for managing the Tempus programme (fourth phase and closure of 
the third phase) and for strengthening cooperation in the areas of education and youth with the 
industrialised  countries  and  other  high-income  countries  and  territories  (ICI)  in  order  to 
include  new  activities  and  bilateral  projects  with  Australia,  New  Zeeland,  Japan  and  South 
Korea.  Therefore,  the  Commission  has  proposed  a  third  extension  of  the  mandate  of  the 
Agency to Community actions in the field of TEMPUS III and IV programmes and the ICI 
programme.  This  proposal  was  submitted  to  the  Regulatory  Committee  for  Executive 
Agencies  which  gave  a  favourable  opinion  on  7  July  2008  and  was  also  submitted  in 
accordance with the working arrangements applicable to the creation/extension of executive 
agencies, to the opinion of the European Parliament Committee on Budgets (COBU).  

8.2. 

Budgetary implications 

The  additional  tasks  given  to  EACEA  related  to  the  mentioned  extensions  will  lead  to  an 
increase in the subsidy of the Executive Agency, and will be covered by appropriations under 
items  19 01 04 30  EACEA  –  Subsidy  for  External  Relations  programmes  and  22 01 04 30 
EACEA  –  Subsidy  for  programmes  under  heading  4  in  the  Enlargement  policy  area.  The 
amounts concerning the last extension (Tempus III-IV and ICI) are put in reserve pending of 
its approval by the Budgetary Authority.  

Taking  into  consideration  these  two  extensions  in  2008,  the  subsidy  by  programme  and  by 
budgetary line under heading 4 is broken down as follows: 

EN 

12 

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(in million EUR) 

Budget line 

Programme 

and  Partnership  Policy,  ENPI 

- Erasmus Mundus External Cooperation Window(European 
and 
Neighbourhood 
Development Cooperation Instrument, DCI ) 
- ICI bilateral education cooperation 
- Tempus (ENPI and DCI) 
Western Balkans Youth 
Erasmus Mundus External Cooperation Window 
Tempus (Instrument for Pre-accession Assistance, IPA) 

19 01 04 30 

22 01 04 30 
TOTAL 
EXTENSIONS 

OF 

2009 

+ 3.79412 

+ 1.41013 

+ 5.204 

These increases have to be covered by the existing envelopes of the operational programmes 
they manage as follows: 

(in million EUR) 

Budget line 

Programme 

19 05 01 

19 08 01 01 

19 08 01 03 
19 09 01 
19 10 01 01 
19 10 02 

Chapter 40 01 
Sub-total 
22 02 07 01 
TOTAL 
EXTENSIONS  

OF 

Cooperation with Industrialised non-member countries (ICI) 
European Neighbourhoud and Partnership policy – Financial 
cooperation with Mediterranean Countries 
European Neighbourhoud and Partnership policy – Financial 
cooperation with Eastern Europe 
Cooperation with developing countries in Latin America 
Cooperation with developing countries in Asia  
Cooperation with the developing countries of Central Asia 
Reserve  (Education,  Audiovisual  and  Culture  Executive 
Agency – Subsidy for External Relations programmes) 

Regional and horizontal programmes (IPA) 

2009 

- 0.203 

- 0.847 

- 1.180 

- 0.190 
- 0.310 
- 0.333 

- 0.731 

- 3.794 
- 1.410 

- 5.204 

The establishment plan of the agency proposed in the 2009 Preliminary Draft Budget needs to 
be amended in order to add eight temporary agent posts in 2009 for the second extension. 

9. 

EXECUTIVE AGENCY FOR THE PUBLIC HEALTH PROGRAMME (PHEA) AND TRANS-
EUROPEAN TRANSPORT NETWORK EXECUTIVE AGENCY (TEN-T EA) 

On 15 April 2008, the Committee on Executive Agencies (CREA), established by Article 24 
of  Council  Regulation  (EC)  No  58/200314,  approved  the  extension  of  the  mandate  of  the 
Executive  Agency  for  the  Public  Health  Programme  (PHEA),  and  the  Trans-European 
Transport  Network  Executive  Agency  (TEN-T  EA).  This  was  followed  on  29  May  by  the 
approval of the European Parliament's Committee on Budgets (COBU). 

12 

13 

14 

Of  which  EUR  2.563  on  the  reserve  subject  to  the  approval  of  the  second  extension  in  2008  by  the 
budgetary authority. 
Of  which  EUR  1.314  on  the  reserve  subject  to  the  approval  of  the  second  extension  in  2008  by  the 
budgetary authority. 
Council  Regulation  (EC)  No  58/2003  of  19  December  2002  laying  down  the  statute  for  executive 
agencies  to  be  entrusted  with  certain  tasks  in  the  management  of  Community  programmes  (OJ  L  11, 
16.1.2003, p. 1). 

EN 

13 

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By Commission Decisions C (2008)2939 of 20 June 2008 and C(2008)3465 of 11 July 2008, 
the mandate of these Agencies were further extended to cover respectively the management of 
the  Consumer  Policy  Programme  2007-2013  and  of  the  Community  food  safety  training 
measures and to take responsibility for the management of transport projects supported by the 
new TEN-T Programme 2007-2013. 

The 2009 preliminary draft budget foresaw appropriations, as subsidy, allocated to these two 
agencies which were entered in reserve pending approval by the budgetary authority. As this 
condition is now met and the extension decided, it is now proposed to transfer the following 
amounts from the reserve 40 01 40 to the corresponding lines. 

Agency for Health 
and Consumers 

Agency for Trans-
European Network 

17 01 04 30 

17 01 04 31 

06 01 04 31 

EUR 1 710 000 

EUR 1 100 000 

EUR 9 794 000 

EN 

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SUMMARY TABLE BY HEADING OF THE FINANCIAL FRAMEWORK 

Financial framework 
Heading/subheading 

2009 Financial Framework 

PDB 2009 

AL 1/2009 

PDB 2009 + AL No 1/2009 

CA 

PA 

CA 

PA 

CA 

PA 

CA 

PA 

1. SUSTAINABLE GROWTH 

1a. Competitiveness for growth and 
employment 
1b. Cohesion for growth and employment 

11.272.000.000

48.428.000.000

11.689.966.000

10.285.190.500

11.689.966.000

10.285.190.500 

Total 

59.700.000.000

60.103.850.669

45.199.324.666

Margin1 

96.149.331   

48.413.884.669

34.914.134.166

48.413.884.669

34.914.134.166 

60.103.850.669

45.199.324.666 

96.149.331   

2. PRESERVATION AND 
MANAGEMENT OF NATURAL 
RESOURCES 
Of which market related expenditure and 
direct payments 

46.679.000.000

42.860.252.000

42.814.219.000

42.860.252.000

40.825.600.500 

3. CITIZENSHIP, FREEDOM, 
SECURITY AND JUSTICE 
3a. Freedom, Security and Justice 

3b. Citizenship 

Total 

59.639.000.000

57.525.729.686

54.834.932.000

Margin2 

2.113.270.314

872.000.000

651.000.000

839.125.000

628.733.000

596.670.000

669.010.000

Total 

1.523.000.000

1.467.858.000

1.265.680.000

Margin    

55.142.000   

57.525.729.686

54.834.932.000 

2.113.270.314

839.125.000

628.733.000

596.670.000 

669.010.000 

1.467.858.000

1.265.680.000 

55.142.000   

4. EU AS A GLOBAL PLAYER3 

7.440.000.000

7.440.432.000

7.579.456.769

179.000.000

180.000.000

7.619.432.000

7.759.456.769 

5. ADMINISTRATION4 

6. COMPENSATION 

Margin 

Margin 

Margin 

7.699.000.000

7.655.255.982

7.655.255.982

243.568.000

210.000.000

121.744.018

209.112.912

887.088

209.112.912

59.786.000

7.655.255.982

7.655.255.982 

121.744.018

209.112.912

209.112.912 

887.088

TOTAL 

136.211.000.000

123.858.000.000

134.402.239.249

116.743.762.329

179.000.000

180.000.000

134.581.239.249

116.923.762.329 

Margin    

2.630.760.751

7.436.237.671

2.446.978.751

7.256.237.671 

1 
2 
3 
4 
the staff contributions to the pensions scheme. 

The European Globalisation adjustment Fund (EGF) is not included in the calculation of the margin under Heading 1a. 
The European Union Solidarity Fund (EUSF) amount is entered over and above the relevant headings as foreseen by the IIA of 17 May 2006 (OJ C 139 of 14.6.2006). 
The 2008 margin for heading 4 does not take into account the appropriations related to the Emergency Aid Reserve (EUR 244 million). 
For calculating the margin under the ceiling for heading 5, account is taken of the footnote (1) of the financial framework 2007-2013 for an amount of EUR 78 million for 

EN 

15 

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