DRAFT AMENDING BUDGET No 5 TO THE GENERAL BUDGET 2017 Providing the financing for the European Fund for Sustainable Development (EFSD) and increasing the Emergency Aid Reserve (EAR) further to the revision of the Multiannual Financial Framework regulation
Date: 2017-07-28
Institutions: Directorate-General for Budget, European Commission
Subjects: amending budget, commitment of expenditure, draft budget (EU), emergency aid, financial year, fund (EU), general budget (EU), sustainable development

EN 

   EN 

   EUROPEAN COMMISSION  Brussels, 28.7.2017 COM(2017) 485 final   DRAFT AMENDING BUDGET No 5 TO THE GENERAL BUDGET 2017 Providing the financing for the European Fund for Sustainable Development (EFSD) and increasing the Emergency Aid Reserve (EAR) further to the revision of the Multiannual Financial Framework regulation  
 
 
Having regard to: 

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the Treaty on the Functioning of the European Union, and in particular  Article 314 
thereof,  in  conjunction  with  the  Treaty  establishing  the  European  Atomic  Energy 
Community, and in particular Article 106a thereof, 

Regulation  (EU,  Euratom)  No  966/2012  of  the  European  Parliament  and  of  the 
Council of 25 October 2012 on the financial rules applicable to the general budget of 
the Union1, and in particular Article 41 thereof, 

the general budget of the European Union for the financial year 2017, as adopted on 
1 December 20162, 
the amending budget No 1/20173, adopted on 5 April 2017, 
the amending budget No 2/20174, adopted on 4 July 2017, 
the draft amending budget No 3/20175, adopted on 30 May 2017, 
the draft amending budget No 4/20176, adopted on 26 June 2017, 

The European Commission hereby presents draft amending budget No 5 to the 2017 budget to 
the European Parliament and to the Council. 

CHANGES  TO  THE  STATEMENT  OF  REVENUE  AND  EXPENDITURE  BY 
SECTION 

The  changes  to  the  statement  of  revenue  and  expenditure  by  section  are  available  on  EUR-
Lex (http://eur-lex.europa.eu/budget/www/index-en.htm). An English version of the changes 
to this statement is attached for information as a budgetary annex. 

1 
2 
3  
4  
5  
6  

OJ L 298, 26.10.2012, p. 1. 
OJ L 51, 28.2.2017. 
OJ L 136, 24.5.2017. 
OJ L XXX, XX.XX.XXXX. 
COM(2017) 288, 30.5.2017. 
COM(2017) 541, 26.6.2017. 

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TABLE OF CONTENTS 

1. 

2. 

3. 

4. 

INTRODUCTION ................................................................................................................................... 4 

EUROPEAN FUND FOR SUSTAINABLE DEVELOPMENT (EFSD) ............................................ 4 

2.1   CONTEXT .................................................................................................................................................. 4 
2.2   FINANCING ............................................................................................................................................... 5 

INCREASE OF THE EMERGENCY AID RESERVE (EAR) ........................................................... 5 

SUMMARY TABLE BY MFF HEADING ........................................................................................... 7 

3 

 
 
 
1. 

INTRODUCTION 

The purpose of Draft Amending Budget (DAB) No 5 for the year 2017 is twofold:  

  To  provide  the  financing  from  the  general  budget  2017  for  the  European  Fund  for 
Sustainable  Development  (EFSD)  further  to  the  adoption  of  the  related  legal  base  by  the 
European Parliament and the Council. 

  To  reflect  in  the  general  budget  2017  the  outcome  of  the  mid-term  revision  of  the  MFF 
regulation  as  regards  the  increase  of  the  annual  amount  of  the  Emergency  Aid  Reserve 
(EAR), from EUR 280 million to EUR 300 million in 2011 prices. 

Overall,  this  DAB  increases  the  level  of  commitment  appropriations  by  EUR 297,8 million 
whereas the level of payment appropriations remains unchanged. 

2. 

EUROPEAN FUND FOR SUSTAINABLE DEVELOPMENT (EFSD) 

Context  

2.1  
On  7  June  2016  the  Commission  issued  a  Communication7  on  establishing  a  new  Partnership 
Framework with third countries under the European Agenda on Migration8. In the document, the 
Commission proposed a variety of measures to address the most urgent needs of refugees and to 
support host communities, while emphasizing the need for a long term strategy to address the root 
causes of migration. The European Council endorsed the Commission's proposal on 28 June 20169, 
inviting the Commission to present a proposal for an ambitious External Investment Plan (EIP) by 
September 2016. 

The  Commission  presented  a  Communication  towards  the  new  European  External  Investment 
Plan10 to boost investments in Africa and the Neighbourhood. 

The  EIP  follows  the  same  logic  as  the  European  Fund  for  Strategic  Investments  (EFSI):  use  of 
public  funding  as  a  guarantee  to  attract  public  and  private  investment.  As  part  of  the  broader 
efforts  the  EU  is  pursuing  on  the  basis  of  the  new  Partnership  Framework,  the  EIP  would 
complement  the  Union's  development  aid,  strengthen  its  partnerships,  promote  a  new  model  of 
participation of the private sector and contribute to achieving the Sustainable Development Goals. 

The EIP is based on three pillars: (i) the European Fund for Sustainable Development (EFSD), (ii) 
technical  assistance  and  (iii)  improving  investment  climate  and  overall  policy  environment.  The 
EFSD  constitutes  the  integrated  financial  package  of  the  EIP,  combining  financing  of  blending 
facilities  and  an  EFSD  Guarantee  (EUR 1 500 million),  backed  by  an  EFSD  Guarantee  Fund 
(EUR 750 million, of which EUR 350 million from the EU budget and EUR 400 million from the 
European Development Fund). 

On  14  September  2016,  the  Commission  submitted  a  Proposal  for  a  Regulation  establishing  the 
EFSD, the EFSD Guarantee and the EFSD Guarantee Fund11. 

On 17 October 2016, the Commission submitted the Amending Letter No 1 to the Draft General 
Budget 201712, proposing to provision the EFSD Guarantee Fund with EUR 275 million in 2017. 

7   COM(2016) 385, 7.6.2016. 
8   COM(2015) 240, 13.5.2015. 
9   EUCO 26/16. 
10   COM(2016) 581, 14.9.2016. 
11   COM(2016) 586, 14.9.2016 

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In  their  final  agreement  on  the  budget  201713,  the  provisioning  of  the  EFSD  was  not  retained 
pending the adoption of the legal base but the European Parliament and the Council invited "the 
Commission to  request the  necessary appropriations  in  an amending budget  in  2017 in  order to 
provide the financing of the EFSD from the EU budget as soon as the legal base is adopted." 

A final compromise on the draft EFSD Regulation was found between the European Parliament, 
the  Council and  the  Commission  during  their  5th  trilogue on  26  June  2017.  The  agreed  text  was 
then  endorsed  by  the  Council  (COREPER  II)  on  28  June  2017  and  adopted  by  the  European 
Parliament during its plenary session in Strasbourg on 6 July 2017. The final adoption of the EFSD 
Regulation by the Council will follow in September 2017. 

The Commission is therefore requesting in the present DAB the necessary appropriations in order 
to  provide  for  the  contribution  from  the  general  budget  to  the  EFSD  Guarantee  Fund  in  2017 
(EUR 275 million  in  commitment  and  payment  appropriations).  The  remaining  contribution  of 
EUR 75 million from the general budget to the Fund is to be provided in 2018–2020. 

2.2  

Financing 

Given  the  absence  of  margin  under  the  commitment  ceiling  of  heading  4  Global  Europe  in  the 
general  budget  2017  and  taking  into  account  the  redeployments  already  made  in  the  adopted 
budget 2017, the Commission proposes to mobilise the flexibility instrument in order to cover in 
full the reinforcement in commitment  and payment appropriations requested for the financing of 
the EFSD (EUR 275 million). The corresponding proposal to mobilise the flexibility instrument14 
accompanies this DAB. 

As  regards  payment  appropriations,  the  Commission  expects  under-implementation  within  the 
Asylum, Migration and Integration Fund (AMIF) under heading 3 Security and Citizenship. Some 
delays  encountered  in  the  start-up  of  the  programmes  caused  by  the  late  adoption  of  the  legal 
bases, and therefore a delay in programming, and in the designation of national authorities, are the 
main cause of this situation. Moreover, the pace of implementation of the two relocation schemes 
under AMIF is  slower than expected leading to a lower declaration of expenditure  in  the annual 
accounts of the Member States at the end of March 2017. The amount of payment appropriations 
available under heading 3 should therefore be reduced by the amount of EUR 275 million. At the 
moment  of  the  establishment  of  the  general  budget  2017,  it  was  not  possible  to  take  this  into 
account. 

INCREASE OF THE EMERGENCY AID RESERVE (EAR) 

3. 
On 20 June 2017, the Council adopted the revision15 of the Council Regulation (EU, EURATOM) 
No 1311/2013 of 2 December 2013 laying down the multiannual financial framework for the years 
2014-202016 (hereafter the "MFF regulation"). 

This revision includes, amongst others, the increase of the annual amount of the Emergency Aid 
Reserve  (EAR)  foreseen  in  Article  9  of  the  MFF  regulation  from  EUR 280 million  to 

12   COM(2016) 679 final, 17.10.2016. 
13   European Parliament legislative resolution of 1 December 2016 on the joint text on the draft general budget of the 
European  Union  for  the  financial  year  2017  approved  by  the  Conciliation  Committee  under  the  budgetary 
procedure (14635/2016 – C8-0470/2016 – 2016/2047(BUD)). 

14   COM(2017) 480, 28.7.2017. 
15   Council Regulation (EU, EURATOM) No 2017/1123 of 20 June 2017, OJ L 163, 24.6.2017, p. 1. 
16  OJ L 347, 20.12.2013, p. 884. 

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EUR 300 million (in 2011 prices). It is thus necessary to reflect this increase in the general budget 
2017 by adding EUR 22,8 million (in current princes) to the EAR in commitment appropriations. 

As  regards  payment  appropriations,  the  Commission  considers  that  the  amount  available  in  the 
general budget 2017 (EUR 315 million) will suffice to meet its estimated needs. 

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4. 

SUMMARY TABLE BY MFF HEADING 

Heading 

(incl. AB 1-2 & DAB 3-4/2017) 

Budget 2017 

Draft Amending Budget 5/2017 

Budget 2017 

(incl. AB 1-2 & DAB 3-5/2017) 

CA 

PA 

CA 

PA 

CA 

PA 

1. 

Smart and inclusive growth 

75 398 754 456 

55 284 563 532 

75 398 754 456 

55 284 563 532 

Of which under global margin for commitments 

1 939 100 000 

Ceiling  

73 512 000 000 

Margin 

 52 345 544 

1 939 100 000 

73 512 000 000 

 52 345 544 

1a 

Competitiveness for growth and jobs 

21 312 155 821 

19 320 944 503 

21 312 155 821 

19 320 944 503 

Of which under global margin for commitments 

1 439 100 000 

Ceiling 

19 925 000 000 

Margin 

 51 944 179 

1 439 100 000 

19 925 000 000 

 51 944 179 

1b   Economic  social and territorial cohesion 

54 086 598 635 

35 963 619 029 

54 086 598 635 

35 963 619 029 

Of which under global margin for commitments 

 500 000 000 

Ceiling 

53 587 000 000 

Margin 

  401 365 

 500 000 000 

53 587 000 000 

  401 365 

2. 

Sustainable growth: natural resources 

58 584 443 884 

54 913 969 537 

58 584 443 884 

54 913 969 537 

Of which offset against Contingency margin 

- 575 000 000 

Ceiling 

60 191 000 000 

Margin 

1 031 556 116 

60 191 000 000 

- 575 000 000 

1 031 556 116 

Of which: European Agricultural Guarantee Fund 
(EAGF) — Market related expenditure and direct 
payments 

42 612 572 079 

42 562 967 974 

42 612 572 079 

42 562 967 974 

Sub-ceiling 

44 146 000 000 

Net transfer between EAGF and EAFRD 

  318 000 

EAGF Margin 

1 533 109 921 

44 146 000 000 

  318 000 

1 533 109 921 

3. 

Security and citizenship 

4 284 030 960 

3 786 957 287 

- 275 000 000 

4 284 030 960 

3 511 957 287 

Of which under Flexibility Instrument 

 530 000 000 

Of which under Contingency margin 

1 176 030 960 

Ceiling 

Margin 

2 578 000 000 

 530 000 000 

1 176 030 960 

2 578 000 000 

4.  Global Europe 

10 162 120 000 

9 483 081 178 

 275 000 000 

 275 000 000 

10 437 120 000 

9 758 081 178 

Of which under Flexibility Instrument 

 275 000 000 

Of which under Contingency margin 

 730 120 000 

Ceiling 

Margin 

9 432 000 000 

 275 000 000 

 730 120 000 

9 432 000 000 

5. 

Administration 

9 394 513 816 

9 394 599 816 

9 394 513 816 

9 394 599 816 

Of which offset against Contingency margin 

- 507 268 804 

Ceiling 

9 918 000 000 

Margin 

 16 217 380 

9 918 000 000 

- 507 268 804 

 16 217 380 

Of which: Administrative expenditure of the 
institutions 

7 418 902 660 

7 418 988 660 

7 418 902 660 

7 418 988 660 

Of which offset against Contingency margin 

- 507 268 804 

Sub-ceiling 

8 007 000 000 

Margin 

 80 828 536 

Negative reserve 

8 007 000 000 

- 507 268 804 

 80 828 536 

Of which under Flexibility Instrument 

 530 000 000 

 981 093 985 

 275 000 000 

 275 000 000 

 805 000 000 

1 256 093 985 

Total 

157 823 863 116 

132 863 171 350 

 275 000 000 

158 098 863 116 

132 863 171 350 

Of which under global margin for commitments 

1 939 100 000 

Of which under Contingency margin 

1 906 150 960 

Of which offset against Contingency margin 

-1 082 268 804 

-2 818 233 715 

Margin 

1 100 119 040 

8 205 688 920 

Ceiling 

155 631 000 000 

142 906 000 000 

Other special Instruments 

1 771 124 013 

1 627 200 013 

 22 800 000 

1 939 100 000 

1 906 150 960 

155 631 000 000 

142 906 000 000 

-1 082 268 804 

-2 818 233 715 

1 100 119 040 

8 480 688 920 

1 793 924 013 

1 627 200 013 

Grand Total 

159 594 987 129 

134 490 371 363 

 297 800 000 

159 892 787 129 

134 490 371 363 

7