COMMUNICATION FROM THE COMMISSION TO THE COUNCIL AND THE EUROPEAN PARLIAMENT Technical adjustment of the financial framework for 2015 in line with movements in GNI (Article 6 of Council Regulation No 1311/2013 laying down the multiannual financial framework for the years 2014-2020) 
Date: 2014-05-28
Institutions: European Commission
Subjects: budgetary procedure, commitment of expenditure, financial management, national income, structural adjustment













EUR-Lex - 52014DC0307 - EN











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52014DC0307

COMMUNICATION FROM THE COMMISSION TO THE COUNCIL AND THE EUROPEAN PARLIAMENT Technical adjustment of the financial framework for 2015 in line with movements in GNI (Article 6 of Council Regulation No 1311/2013 laying down the multiannual financial framework for the years 2014-2020) /* COM/2014/0307 final */









COMMUNICATION FROM THE COMMISSION TO
THE COUNCIL AND THE EUROPEAN PARLIAMENT
Technical adjustment of the financial
framework for 2015 in line with movements in GNI
(Article 6 of Council Regulation No 1311/2013 laying down the multiannual
financial framework for the years 2014-2020)
1.           introduction
Council Regulation No 1311/2013 laying down the multiannual financial framework for the years
2014-2020[1]
(MFF Regulation) contains the financial framework table for EU-28 for the period
2014-2020, expressed in 2011 prices (Table 1).
According to Article 6(1) of the MFF
Regulation, the Commission makes each year, ahead of the budgetary procedure
for year n+1, a technical adjustment to the financial framework in line with
movements in the EU's gross national income (GNI) and prices and communicates
the results to the two arms of the budgetary authority. As far as prices are
concerned, expenditure ceilings at current prices are established using the
fixed 2% deflator as provided for in Article 6(2) of the MFF Regulation. As far
as movements in GNI are concerned, the present Communication includes the
latest economic forecasts available.
At the same time the Commission shall calculate
the margin available under the own-resources ceiling set in accordance with
Decision 2007/436/EC, Euratom, the absolute amount of the Contingency Margin
provided for in Article 13, the global margin for payments provided for in
Article 5, and the global margin for commitments provided for in Article 14 of
the MFF Regulation. In addition, according to Article 3(1) of the MFF
Regulation, the sub-ceiling for heading 2 concerning market related expenditure
and direct payments shall be adjusted following the transfers between pillar I
and rural development in accordance with the legal act establishing these
transfers. 
The purpose of this communication is to present
to the budgetary authority the result of the technical adjustments (EU-28) for
2015 according to Article 6 of the MFF Regulation. 
2.           terms
of the adjustment of the financial framework table (tables 1-2)
Table 1 shows
the financial framework for EU-28 in 2011 prices as included in Annex I of the
MFF Regulation.
Table 2 shows
the financial framework for EU-28 adjusted for 2015 (i.e. in current prices).
The financial framework expressed in percentage of GNI is updated with the
latest economic forecasts available (Spring 2014) and long-term projections.
2.1.        Total
figure for GNI
According to the latest forecast available, the
GNI for 2015 is established at EUR 13 918 050 million in
current prices for EU-28.
2.2.        Main results of the technical adjustment of the
Financial Framework for 2015
The overall ceiling for commitment
appropriations for 2015 (EUR 146 483 million) equals 1.05 %
of GNI.
The corresponding overall ceiling concerning
the payment appropriations (EUR 141 901 million) equals 1.02 %
of GNI. On the basis of the latest economic forecasts, this leaves a margin
beneath the 1.23 % own resources ceiling of EUR 29 291 million
(0.21 % of GNI for EU-28).
2.3.        Adjustment of the sub-ceiling
for Heading 2
According to Article 3(1) of the MFF
Regulation, the sub-ceiling for heading 2 of in total EUR 312 735 million for
market related expenditure and direct payments in the period 2014 to 2020 shall
be adjusted following the transfers between pillar I and rural development in
accordance with the legal act establishing these transfers. 
The amounts made available to the European
Agricultural Fund for Rural Development (EAFRD), as set out in the Commission
Implementing Regulation No 367/2014[2],
consist of the following elements (see table below):
(1)         
The voluntary adjustment fixed in Commission
Implementing Decision 2013/146/EU pursuant to Article 10b of Regulation (EC) No
73/2009, to be added to the annual breakdown of Union support to rural
development in accordance with Article 10c(2) of the same Regulation. The
Commission Implementing Decision fixes this amount at EUR 296.3 million in the United Kingdom for financial year 2014. 
(2)         
The amounts to be transferred to the EAFRD in
accordance with Articles 136 and 136b of Regulation (EC) No 73/2009 for Germany
and Sweden of in total EUR 51.6 million each year for financial year 2014 and
2015 ('unspent amounts').
(3)         
The amounts to be transferred to the EAFRD in
accordance with Article 66(1) of Regulation (EU) No 1307/2013. Greece will transfer EUR 4 million annually from 2014 ('EL cotton'). 
This first set of transfers reduces the net
balance available for European Agricultural Guarantee Fund (EAGF) expenditure
by EUR 427.5 million in 2014-2020 and the MFF sub-ceiling for market related
expenditure and direct payments needs to be adjusted from EUR 312 735 million
to EUR 312 309 million as shown in the table below.
In addition, a second set of transfers between
pillar I and rural development has been decided which is not yet reflected in
the respective Commission Implementing Regulation. Following the notifications
made by Member States by 31 December 2013 on flexibility between pillars in
accordance with Article 14 of Regulation (EU) No 1307/2013, the total transfer
of the amounts from the direct payments ceilings to rural development
programming for the financial years 2015-2020 is EUR 3 884.380 million,
while the total transfer of the amounts from rural development programming for
the financial years 2015-2020 to direct payments ceilings is EUR 2 988.507
million.
However, these
figures are only preliminary. This second adjustment to the H2 sub-ceiling can
only be implemented in 2015 (in the technical adjustment for 2016) after the
amendment to Commission Implementing Regulation setting the net balance
available for the EAGF  comes into force[3].
At that time further adjustments related to the flexibility between pillars
might be taken into account following the second notification deadline on 1
August 2014.
The modification of the H2 sub-ceiling in
current prices needs to be translated into 2011 prices in order to technically
adjust the MFF table in 2011 prices.  
For this purpose the EAGF net balance is first
transformed into 2011 prices by using the 2% fixed deflator. This is then
rounded up to obtain the adjusted H2 sub-ceiling as the MFF ceilings are only
expressed in million of Euros. Only with this rounding-up procedure it can be
ensured that the MFF sub-ceiling is always higher than the net balance
available for EAGF expenditure. The resulting small difference does not
constitute an available margin, but is exclusively arising from the rounding
operation as all figures in the MFF table needs to be expressed in million of
Euros. For each annual budget, the Commission will use the exact amounts of the
net balance available for EAGF expenditure as it was already the case for
budget 2014.  
3.           global
margin for payments
According to Article 5 of the MFF Regulation, the
Commission will adjust the payment ceiling for the years 2015-2020 upwards by
an amount equivalent to the difference between the executed payments and the
MFF payment ceiling of the year n-1. Any upward adjustment shall be fully
offset by a corresponding reduction of the payment ceiling for year n-1.
This adjustment will be done for the first time
in 2015 (in the technical adjustment for 2016).
4.           special
instruments
A number of instruments are available outside
expenditure ceilings agreed in the financial framework 2014-2020. These
instruments aim at providing rapid response to exceptional or unforeseen
events, and provide some flexibility beyond the agreed expenditure ceilings
within certain limits:
4.1.        Emergency
Aid Reserve
According to Article 9 of the MFF Regulation,
the Emergency Aid reserve can be mobilised up to a maximum amount of
EUR 280 million per year in 2011 prices, or EUR 303 million
in 2015 at current prices (EUR 2 209 million for the whole
period in current prices). The portion of the unused amount of the previous
year can be carried over.
4.2.        European
Union Solidarity Fund
According to Article 10 of the MFF Regulation,
the EU Solidarity Fund can be mobilised up to a maximum amount of
EUR 500 million per year in 2011 prices, or EUR 541 million
in 2015 at current prices (EUR 3 945 million for the whole
period in current prices). The portion of the unused amount of the previous
year can be carried over.
4.3.        Flexibility
Instrument
According to Article 11 of the MFF Regulation,
the Flexibility Instrument can be mobilised up to a maximum annual
amount of EUR 471 million in 2011 prices, or EUR 510 million in 2015
in current prices (EUR 3 716 million for the whole period in
current prices). The portion of the unused annual amounts of the previous 3
years may be carried over.
4.4.        European
Globalisation Adjustment Fund
According to Article 12 of the MFF Regulation,
the European Globalisation Adjustment Fund can be mobilised up to a
maximum of EUR 150 million per year in 2011 prices, or EUR 162
million in 2015 in current prices (EUR 1 183 million for the
whole period in current prices). 
4.5.        Contingency
Margin
According to Article 13 of the MFF Regulation,
a Contingency Margin of up to 0.03 % of the Gross National Income of the Union shall be constituted outside the ceilings of the financial framework for the
period 2014‑2020.
The absolute amount of the Contingency Margin
for the year 2015 is EUR 4 175.4 million.
4.6.        Global
margin for commitments for growth and employment,
in particular youth employment
According to Article 14 of the MFF Regulation, margins
left available below the MFF ceilings for commitment appropriations for the
years 2014-2017 shall constitute a Global MFF Margin for commitments, to be
made available over and above the ceilings established in the Annex of the MFF
Regulation for the years 2016 to 2020 for policy objectives related to growth
and employment, in particular youth employment. The Commission shall calculate
the amount available. 
The Global MFF Margin for commitments will be
calculated for the first time in 2015 (in the technical adjustment for 2016).
[1]               OJ L 347, 20.12.2013, p. 884.
[2]               Commission Implementing Regulation (EU) No 367/2014
of 10 April 2014 setting the net balance available for EAGF expenditure (OJ L
108, 11.4.2014, p. 13)
[3]               Commission Delegated Regulation (EU) No xxx/xxxx of
13 May 2014 amending Annexes VIII and VIIIc to Council Regulation (EC) No
73/2009, Annex I to Regulation (EU) No 1305/2013 of the European Parliament and
of the Council and Annexes II, III and VI to Regulation (EU) No 1307/2013 of
the European Parliament and of the Council (C(2014)3006) was sent to the EP and
the Council. Both institutions have a scrutiny period of minimum 2 months to
object. Only after that scrutiny period, the Commission will be able to adopt an
amending Commission Implementing Regulation setting the net balance available
for EAGF expenditure. The flexibility between pillars notified on the 31
December 2013 will be already taken into account for the Draft budget 2015.