AMENDING LETTER No 1 TO THE DRAFT GENERAL BUDGET 2020 Updated estimated needs for agricultural expenditure Adjustments related to the legislative proposals included in the Brexit preparedness package of 4 September 2019 Reinforcements of administrative budgets and other updates based on recent developments Adjustment to the structure of the budget and a technical correction
Date: 2019-10-15
Institutions: Directorate-General for Budget, European Commission
Subjects: United Kingdom, administrative expenditure (EU), agricultural expenditure, amending budget, commitment of expenditure, draft budget (EU), financial year, general budget (EU), withdrawal from the EU

EN 

  EN 

   EUROPEAN COMMISSION  Brussels, 15.10.2019  COM(2019) 487 final  AMENDING LETTER No 1 TO THE DRAFT GENERAL BUDGET 2020 Updated estimated needs for agricultural expenditure         Adjustments related to the legislative proposals included in the Brexit preparedness package of 4 September 2019    Reinforcements of administrative budgets and other updates based on recent developments        Adjustment to the structure of the budget and a technical correction                    
 
 
Having regard to: 

– 

– 

– 

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) 2018/1046 of the European Parliament and of the Council 
of 18 July 2018 on the financial rules applicable to the general budget of the Union 
(…)1, and in particular Article 42 thereof, 

the  draft  general  budget  of  the  European  Union  for  the  financial  year  2020,  as 
adopted by the Commission on 5 July 20192, 

The  European  Commission  hereby  presents  to  the  European  Parliament  and  to  the  Council 
Amending  Letter  No 1  to  the  draft  general  budget  of  the  European  Union  for  the  financial 
year 2020, for the reasons set out in the explanatory memorandum. 

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 (https://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 

OJ L 193, 30.7.2018, p. 1. 
COM(2019) 400, 5.7.2019. 

1 

 
 
 
 
                                                 
TABLE OF CONTENTS 

1. 

2. 

INTRODUCTION ................................................................................................................................... 3 

EUROPEAN AGRICULTURAL GUARANTEE FUND .................................................................... 3 

2.1   OVERVIEW ................................................................................................................................................ 3 
2.2   DETAILED COMMENTS ............................................................................................................................. 4 
2.3   DETAILED FIGURES BY BUDGET LINE ...................................................................................................... 5 

3. 
ADJUSTMENTS RELATED TO THE LEGISLATIVE PROPOSALS INCLUDED IN THE 
BREXIT PREPAREDNESS PACKAGE OF 4 SEPTEMBER 2019. ............................................................... 5 

3.1   EUROPEAN UNION SOLIDARITY FUND ..................................................................................................... 5 
3.2   CREATION OF A NEW BUDGET LINE IN THE GENERAL STATEMENT OF REVENUE ................................. 6 

4. 

OTHER ADJUSTMENTS ..................................................................................................................... 6 

4.1   SECTION I – EUROPEAN PARLIAMENT .................................................................................................... 6 
4.3   SECTION X – EUROPEAN EXTERNAL ACTION SERVICE .......................................................................... 7 
4.3   UPDATE OF THE SUSTAINABLE FISHERIES PARTNERSHIP AGREEMENTS .............................................. 8 

5. 

TECHNICAL ADJUSTMENT AND CORRECTION ........................................................................ 9 

5.1   INNOVATION FUND ................................................................................................................................... 9 
5.2   EUROPEAN UNION AGENCY FOR THE OPERATIONAL MANAGEMENT OF LARGE-SCALE IT SYSTEMS 

IN THE AREA OF FREEDOM, SECURITY AND JUSTICE (EU-LISA) ........................................................... 9 

6. 

SUMMARY TABLE BY MFF HEADING ......................................................................................... 11 

2 

 
 
 
1. 

INTRODUCTION 

Amending Letter No 1 to the draft budget for the year 2020 (AL 1/2020) covers the following: 

  The  updating  of  the  estimated  needs,  assigned  revenue  and  appropriations  for  agricultural 
expenditure.  In  addition  to  changing  market  factors,  AL 1/2020  also  incorporates  the  impact  of 
decisions  in  the  agricultural  sector  since  the  2020  Draft  Budget  (DB 2020)  was  adopted  in  July 
2019, as well as other proposals expected to have a significant effect during the budget year. 

  Adjustments  related  to  the  legislative  proposals  included  in  the  Brexit  preparedness  package  of 

4 September 2019. 

  Other  adjustments  concerning  the  administrative  budgets  of  the  European  Parliament  and  the 

European External Action Service, and sustainable fisheries partnership agreements. 

  An adjustment to the structure of the budget to accommodate the Innovation Fund. 

  A technical correction (eu-LISA).  

Overall,  the  net  impact  of  AL 1/2020  on  expenditure  in  the  draft  budget  2020  is  an  increase  of 
EUR 16,4 million  in  commitment  appropriations  and  a  decrease  of  EUR 5,4 million  in  payment 
appropriations. 

2. 

EUROPEAN AGRICULTURAL GUARANTEE FUND  

2.1  

Overview 

AL 1/2020 updates estimates for agricultural expenditure based on the most up-to-date economic data 
and  legislative  framework.  By  late  September  2019,  the  Commission  has  at  its  disposal  a  first 
indication of the level of production for 2019 and the outlook for the agricultural markets as well as 
actual figures for most of the 2019 budget execution as regards EAGF shared management, which are 
the basis for the updated estimates of the budgetary needs for 2020.  

Apart  from  taking  into  account  market  factors,  this  AL 1/2020  also  incorporates  the  impact  of 
legislative decisions in the agricultural sector since the DB 2020 was drawn up in June 2019, as well 
as for some that are still under preparation, soon to be adopted.  

Overall,  2020  EAGF  needs  (after  taking  into  account  EAGF  provisions  related  to  'financial 
discipline') are now estimated at EUR 44 481,1 million3, which is an increase by EUR 304,3 million 
compared to the DB 2020. This increase is mostly due to additional needs  for chapter 05 07 Audit of 
agricultural  expenditure 
the  European  Agricultural  Guarantee  Fund  (EAGF) 
(+EUR 174,3 million) and for chapter 05 03 Direct payments aimed at contributing to farm incomes, 
limiting farm incomes variability and meeting environment and climate objectives (+EUR 94 million). 
There are also small modifications for chapter 05 02 Improving the competitiveness of the agricultural 
sector through interventions in agricultural markets for +EUR 36,0 million.  

financed  by 

The amount of assigned revenue estimated to be available in 2020 increases from EUR 645,0 million 
in  DB 2020  to  EUR 999,0 million  (+EUR 354,0 million),  more  than  compensating  the  additional 
needs. The update of estimates concerns the amounts originating from clearance of accounts decisions 
(+EUR 181,0 million) and irregularities (-EUR 7,0 million). Furthermore, AL 1/2020 incorporates an 
expected  carry-over  of  assigned  revenue  from  2019  to  2020  for  an  amount  of  EUR 280,0 million 

3  

The  needs  amount  corresponds  to  EUR 43 482,1 million  fresh  appropriations  plus  EUR 999,0 million  assigned 
revenue. 

3 

 
  
 
                                                 
(expected  EAGF  'surplus')4,  of  which  EUR 100,0 million  were  already  anticipated  in  the  DB 2020. 
The  estimated  surplus  does  not  include  unused  appropriations  (EUR 468,7 million)  of  the  2019 
agricultural  crisis  reserve,  which  will  not  be  called  on.  These  unused  appropriations  will  be  carried 
over for reimbursement to farmers subject to the financial discipline in 2020. 

As  a  result  of  these  updates,  the  Commission  proposes  to  reduce  the  expenditure  estimates  for 
to  DB 2020.  Commitment  appropriations  of 
agriculture  by  –EUR 49,7 million  compared 
EUR 43 482,1 million, which include EUR 478,0 million for the Reserve for crises in the agricultural 
sector, are required to cover EAGF needs for 2020. This overall amount remains below the EAGF net 
sub-ceiling of EUR 43 887,1 million. This means that the financial discipline mechanism will only be 
applied to establish the agricultural crisis reserve for budget year 20205.   

2.2  

Detailed comments 

05 02  Improving  competitiveness  of  the  agricultural  sector  through  interventions  in 
agricultural markets (appropriations +EUR 36,0 million) 

Interventions in agricultural markets 

Draft Budget 2020 

(in million EUR, rounded figures at current prices) 

Amending Letter 
 No 1/2020 

Draft Budget 2020 
(incl. AL 1/2020) 

Needs 

-Estimated assigned revenue available in 2020 

Appropriations requested 

2 644,1 

150,0 

2 494,1 

+36,0 

0,0 

+36,0 

2 680,1 

150,0 

2 530,1 

Overall,  the  needs  for  intervention  measures  on  agricultural  markets  slightly  increase  by 
EUR 36,0 million compared to the DB 2020. As the amount of assigned revenue remains unchanged 
compared  to  DB 2020,  the  appropriations  requested  in  AL 1/2020  increase  by  the  same  amount  to 
EUR 2 530,1 million. 

The most significant modification proposed in AL 1/2020 for market measures concerns the poultry 
sector  (budget  item  05 02 15 99)  with  an  increase  of  EUR 32,0 million,  relating  to  specific 
exceptional measures to farmers following outbreaks of avian influenza. Furthermore, an increase of 
EUR 4,0 million is proposed for specific aid for bee-keeping (budget item 05 02 15 06).   

05 03  Direct  payments  aimed  at  contributing  to  farm  incomes,  limiting  farm  income 
variability and meeting environment and climate objectives (appropriations - EUR 260,0 million) 

Direct payments 

Draft Budget 2020 

(in million EUR, rounded figures at current prices) 

Amending Letter 
 No 1/2020 

Draft Budget 2020  
(incl. AL 1/2020) 

After financial discipline (including credits for the ‘Reserve for crises in the agricultural sector’) 

Needs 

- Estimated assigned revenue available in 2020 

Appropriations requested 

41  448,0 

495,0 

40 953,0 

+94,0 

+354,0 

-260,0 

41 542,0 

849,0 

40 693,0 

Compared  to  DB 2020,  appropriations  requested  for  chapter  05 03  are  revised  downwards  by 
EUR 260,0 million.  This  change  is  mostly  due  to  the  higher  amount  of  revenue  assigned 
(+EUR 354,0 million)  to  item  05 03 01 10  Basic payment  scheme  (BPS).  The  increase  for  estimated 
needs (+EUR 94,0 million) compared to the DB 2020 reflects very high execution in the 2019 budget 
year that is expected to continue in 2020. There are some variations between budget items for direct 
payments, reflecting updated needs assessment (see table below).  

4  

5  

This estimate is based on the declarations of actual expenditure received from Member States up to the month of 
August 2019, complemented by forecasts for the period 01.09.2019 to 15.10.2019. Full information on the actual 
expenditure for this remaining period will become available at the end of October/beginning of November 2019.  
The adjustment rate for direct payments related to the financial discipline mechanism in respect of the calendar 
year 2019 is set in Commission Implementing Regulation (EU) 2019/916. The Commission will update this rate 
accordingly taking into account the modifications proposed in this AL. 

4 

 
  
 
                                                 
Other  agricultural  expenditure  financed  by  the  European  Agricultural  Guarantee  Fund 
(EAGF) (appropriations +EUR 174,3 million) 

Appropriations  for  budget  article  05 07 01 07  Financial  corrections  in  favour  of  Member  States 
following  conformity  clearance  decisions  need  to  be  increased  by  EUR 176,6 million  as  a 
consequence  of  two  Court  of  Justice  rulings  (Cases  T-459/16  and  T-237/17)  in  favour  of  Member 
States on former clearance decisions. Furthermore, there is a small update for budget item 05 07 01 06 
Financial  corrections  in  favour  of  Member  States  following  accounting  clearance  decisions  for  an 
amount of -EUR 2,3 million (see table below). 

2.3  

Detailed figures by budget line 

Budget line 

Name 

Section III – European Commission 

05 02 15 06  Specific aid for bee-keeping 

05 02 15 99 

Other measures for pigmeat, poultry, eggs, bee-keeping, other 
animal products 

Sub-total  05 02 

05 03 01 02  Single area payment scheme (SAPS) 
05 03 01 07  Redistributive payment 
05 03 01 10  Basic payment scheme (BPS) 

05 03 01 11 

Payment for agricultural practices beneficial for the climate and 
the environment 

05 03 01 13  Payment for young farmers 
05 03 01 99  Other (decoupled direct payments) 
05 03 02 50  POSEI – European Union support programmes 
05 03 02 60  Voluntary coupled support scheme 
05 03 02 61  Small farmers scheme 
05 03 02 99  Other (direct payments) 

Sub-total  05 03 
Expenditure for financial corrections in favour of Member States 
following decisions on accounting clearance of previous years’ 
accounts with regard to shared management declared under the 
EAGGF-Guarantee Section (previous measures) and under the 
EAGF 
Expenditure for financial corrections in favour of Member States 
following decisions on conformity clearance of previous years’ 
accounts with regard to shared management declared under the 
EAGGF-Guarantee Section (previous measures) and under the 
EAGF 

05 07 01 06 

05 07 01 07 

Total EAGF 

Commitment 
appropriations 

Payment 
appropriations 

in EUR 

+4 000 000 

+4 000 000 

+32 000 000 

+32 000 000 

+36 000 000 
+21 000 000 
+7 000 000 
-325 000 000 

+36 000 000 
+21 000 000 
+7 000 000 
-325 000 000 

+54 000 000 

+54 000 000 

+120 000 000 
-7 000 000 
+1 000 000 
+7 000 000 
-137 000 000 
-1 000 000 

+120 000 000 
-7 000 000 
+1 000 000 
+7 000 000 
-137 000 000 
-1 000 000 

-260 000 000 

-260 000 000 

-2 300 000 

-2 300 000 

+176 600 000 

+176 600 000 

Sub-total  05 07 

+174 300 000 
-49 700 000 

+174 300 000 
-49 700 000 

The relevant budget remarks are adjusted in annex. 

3. 

ADJUSTMENTS  RELATED  TO  THE  LEGISLATIVE  PROPOSALS  INCLUDED  IN  THE  BREXIT 
PREPAREDNESS PACKAGE OF 4 SEPTEMBER 2019. 

3.1  

European Union Solidarity Fund  

In accordance with Article 4a, paragraph 4 of Council Regulation (EC) No 2012/2002, the DB 2020 
includes  an  amount  of  EUR 50 million  on  budget  article  13 06 01.  This  is  to  ensure  the  timely 

5 

 
  
 
 
availability  of  budgetary  resources  in  cases  where,  when  submitting  an  application  for  a  financial 
contribution from the Fund, a Member State requests the payment of an advance. 

The Commission proposal for a Regulation of the European Parliament and of the Council amending 
Council Regulation (EC) No 2012/2002 in order to provide financial assistance to Member States to 
cover serious financial burden inflicted on them following a withdrawal of the United Kingdom from 
the  Union  without  an  agreement6  introduces  a  new  Article  4b  with  a  higher  maximum  amount  of 
EUR 100 million  for  advances.  Therefore  the  Commission  proposes  to  increase  of  the  level  of 
advance  payments  under  the  European  Union  Solidarity  Fund  by  EUR 50 million,  and  to  put  that 
additional  amount  under  reserve  pending  the  adoption  of  the  amendment  to  the  legal  base  by  the 
European Parliament and the Council. 

The  reserve  article  is  adjusted  as  presented  in  the  table  below,  and  the  budget  remarks  of  articles 
13 06 01 and 13 06 02 are amended. 

Budget line 

Name 

Differentiated  appropriations  (Reserve  for  budget 
article 13 06 01 – Assistance to Member States in the 
event  of  a  major  natural  disaster  with  serious 
repercussions  on 
living  conditions,  the  natural 
environment or the economy) 

40 02 41 

Total 

Commitment 
appropriations 

Payment 
appropriations 

in EUR 

50 000 000 

50 000 000 

50 000 000 

50 000 000 

3.2  

Creation of a new budget line in the General Statement of Revenue 

The Commission proposal for a Council Regulation on measures concerning the implementation and 
financing  of  the  general  budget  of  the  Union  in  2020  in  relation  to  the  withdrawal  of  the  United 
Kingdom from the Union7 lays down rules on the relations between the Union, on the one hand, and 
the United Kingdom and its beneficiaries on the other, as regards the financing and implementation of 
the budget in 2020 in the case of a UK withdrawal without an agreement. 

The  proposed  contingency  framework  provides  for  the  possibility  that  the  UK  and  UK  entities 
maintain,  throughout  the  year  2020,  the  eligibility  to  benefit  from  Union  financing  for  legal 
commitments entered into before the withdrawal date or between the withdrawal date and the end of 
2019,  in  application  of  Regulation  (EU,  Euratom)  2019/1197.  This  is  subject  to  the  terms  and 
conditions set out in the proposal.  

In  order  to  allow  the  Commission  to  implement  the  proposal,  in  particular  to  enable  it  to  enter  the 
contribution of the United Kingdom in the general budget, the necessary budgetary structure needs to 
be created for the 2020 budget. The Commission therefore proposes to create a new budget line in part 
B of the General Statement of revenue: new Article 3 8 0 intended to receive the UK contribution in 
relation to the application of the contingency framework. 

The budget remarks related to the proposed new line are shown in annex. 

4. 

OTHER ADJUSTMENTS 

4.1  

Section I – European Parliament  

The request  to  increase the establishment  plan of the European Parliament  (EP) by 89 posts, and to 
increase  the  level  of    administrative  appropriations  to  allow  for  the  creation  of  additional  contract 

6  
7  

COM(2019) 399 final, 4.9.2019 
COM(2019) 461 final, 4.9.2019 

6 

 
  
 
 
                                                 
agent  positions  were  not  included  in  the  section  of  the  EP  of  the  DB  2020,  pending  further 
clarifications on the reasons for the increase.   

Following  further  exchanges  with  the  EP,  and  taking  into  account  the  rigorous  proposals  for  the 
administrative heading of the next  multiannual  financial framework, it is  proposed to  include in  the 
DB 2020 the following elements for the European Parliament: 

  89 additional establishment plan posts for the year 2020. These posts are intended for one budget 
year only, and will be removed from the establishment plan in the 2021 draft budget. These posts 
are  intended  to  facilitate  the  continuity  of  employment  of  temporary  staff  in  the  light  of  the 
application  of  article  29(4)  of  the  Staff  Regulations.  No  additional  budgetary  appropriations  are 
necessary. The updated establishment plan is set out in the budgetary annex. 

  EUR 13.3 million  of  appropriations  for  external  staff,  corresponding  to  155  contract  agent 
positions,  as  well  as  the  increase  in  appropriations  required  to  cover  salary  updates  and  career 
progression.  With  respect  to  the  contract  agents,  20  are  new  positions  to  be  created  in  the  2020 
budget  to  strengthen  security,  and  are  financed  on  budget  line  1 4 0 1  Other  staff  –  security.  A 
further 135 contract agents are to be financed on budget line 1 4 0 0 Other staff – Secretariat and 
political  groups.  These  contracts  are  already  running,  as  the  staff  were  recruited  in  2019,  with 
financing provided by means of transfers approved by the European Parliament’s Committee on 
Budgets (Transfers C1/2019 and C7/2019). 

Combined effect on the EP's section of the draft budget 2020 

Budget line 

Name 

Section I – European Parliament 

1400 

1401 

Total 

Other staff - Secretariat and political groups 

Other staff - Security 

Commitment 
appropriations 

Payment 
appropriations 

in EUR 

8 880 451 

4 452 138 
13 332 589 

8 880 451 

4 452 138 
13 332 589 

4.2  

Section X – European External Action Service 

Since  the  presentation  of  the  DB 2020,  two  items  in  the  section  of  the  European  External  Action 
Service (EEAS) have evolved, and require updating, namely: 

  The NEO building; 

  Adaptation of the staffing of the EU Office in Kosovo. 

The NEO Building  

The NEO building project consists of two buildings aiming to replace the Kortenberg building for the 
Common  Security  and  Defence  Policy  (CSDP)  departments.  The  project  is  presently  ongoing  and 
expected to be achieved by end-2020/beginning-2021. 

However,  during  the  execution  of  the  renovation  and  fitting-out  works,  the  EEAS  realised  that  the 
necessary technical performance level in the fields of physical security and secured communications 
could not be met within the budget previously estimated.  

The  increases  are  linked  to  the  need  to  protect  the  working  environment  against  intrusions  and 
eavesdropping, in conformity with the security rules established by the Council and by the Member 
States. The level of necessary protection measures evolves in accordance with technological progress 
and in line with the estimated threat levels. This means that many of the solutions previously applied, 
on which the original cost estimate was based, are no longer sufficient.  

7 

 
  
 
 
 
A project update presenting the changes and the resulting additional cost was therefore submitted to 
the European Parliament and the Council and was approved by their respective budget committees on 
September 3 and 13, 2019. 

The  additional  cost  for  these  security-related  measures  would  amount  to  EUR 5.0 million  on  the 
EEAS'  budget  item  2 0 0 2.  However,  through  reprioritisation  and  planned  redeployment,  the 
additional amount requested for 2020 can be reduced to EUR 2.8 million. 

Adaptation of the Staffing of the EU Office in Kosovo 

As  a  result  of  the  2015/2016  Strategic  Review  of  the  EULEX  mission,  a  number  of  Monitoring, 
Mentoring and Advice tasks were transferred from EULEX to the EU Office in Kosovo in June 2018. 
A  budget  to  finance  12  staff  members  in  the  Office  was  therefore  granted  to  the  EEAS  by  the 
European Parliament and the Council, compensated by larger cuts in the EULEX organisation.  

Additional  budget  to  finance  three  further  posts  was  made  available  to  the  EEAS  as  from  January 
2019, bringing the total number of posts for transition tasks to 15. The 2019 EEAS budget was also 
amended to transform three cost-free Seconded National Experts (SNE) posts into co-financed status, 
in order to attract more interest and potential candidates from the Member States. 

However,  this  change  has  not  proven  enough  to  attract  sufficient  interest  and  so  far,  only  two  SNE 
positions out of the total six have been filled.  

Given this situation and based on an assessment of needs in the Office, the EEAS intends to transform 
one of these unused SNE posts into two local agent positions. This transformation is not expected to 
entail any additional costs for the EEAS but could possibly, depending on the experience of the agents 
recruited, produce some small savings over time. 

Combined effect on the EEAS ' section of the draft budget 2019 

Budget line 

Name 

Section X – European External Action Service 

2 0 0 2 

Total 

Fitting out and security works 

Commitment 
appropriations 

Payment 
appropriations 

in EUR 

2 786 000 

2 786 000 

2 786 000 

2 786 000 

Update of the Sustainable Fisheries Partnership Agreements 

4.3  
As  foreseen  in  point  C  of  Part  II  of  the  Interinstitutional  Agreement  (IIA)8,  the  Commission  has 
examined  the  most  recent  information  available  concerning  Sustainable  Fisheries  Partnership 
Agreements (SFPAs) and reviewed the expected needs for 2020 on the basis of the developments in 
the  negotiation  processes  with  the  third  countries  involved.  On  the  basis  of  this  review,  the 
Commission  proposes  to  move  commitment  appropriations  for  an  amount  of  EUR  16,9  million  and 
payment  appropriations  for  an  amount  of  EUR  14,9  million  from  the  reserve  (40  02  41)  to  the 
operational line (11 03 01 Establishing a governance framework for fishing activities carried out by 
Union fishing vessels in third country waters). This budgetary-neutral transfer relates to the Fisheries 
Agreements  with  the  Republic  of  Cape  Verde,  the  Republic  of  the  Gambia  and  the  Republic  of 
Guinea-Bissau, for which the agreements and related protocols have meanwhile been signed and have 
entered into provisional application.  

8  

OJ C 373, 20.12.2013, p. 1. 

8 

 
  
 
 
 
                                                 
The  details  by  budget  line  are  presented  in  the  table  below  and  the  relevant  budget  remarks  are 
adjusted in annex. 

Budget line 

Name 

Establishing  a  governance  framework  for  fishing 
activities  carried  out  by  Union  fishing  vessels  in 
third country waters 
Differentiated  appropriations  (Reserve  for  budget 
article 11 03 01) 

11 03 01 

40 02 41 

Total 

5. 

TECHNICAL ADJUSTMENT AND CORRECTION 

5.1  

Innovation Fund 

Commitment 
appropriations 

Payment 
appropriations 

in EUR 

+16 900 000 

+14 900 000 

-16 900 000 

-14 900 000 

0 

0 

The Innovation Fund was set up by Directive (EU) 2018/410 of the European Parliament and of the 
Council  amending  Directive  2003/87/EC  establishing  a  system  for  greenhouse  gas  emission 
allowances trading within the Union. It supports innovation in low-carbon technologies and processes 
in  certain  economic  sectors.  In  accordance  with  the  provisions  of  Article  10a,  paragraph  8,  of  the 
Emissions Trading System (ETS) Directive 2003/87/EC, the Innovation Fund is fully financed by the 
receipts  from  auctioning  a  certain  amount  of  allowances  to  emit  one  tonne  of  carbon  dioxide 
(equivalent during a specific period) under the ETS. 

According  to  Article  16,  paragraph  1  of  Commission  Delegated  Regulation  (EU)  2019/856  of  26 
February  2019  supplementing  Directive  2003/87/EC  with  regard  to  the  operation  of  the  Innovation 
Fund,  the  Commission  shall  implement  the  Innovation  Fund  in  direct  management  or  indirect 
management  in  accordance  with  the  relevant  provisions  of  the  Financial  Regulation.  According  to 
Article 19, paragraph 3 of Regulation (EU) 2019/856, for all implementation tasks carried out by the 
Commission,  including  through  an  EU  executive  agency,  the  revenue  of  the  Innovation  Fund  shall 
constitute external assigned revenue for the EU budget within the meaning of paragraphs 1 and 5 of 
Article 21 of the Financial Regulation. The Innovation Fund expenditure, including the administrative 
cost,  would  be  fully  financed  by  the  external  assigned  revenue  generated  by  the  auctioning  of  the 
emissions allowances and unspent amounts from the previous NER300 programme. 

To  allow  the  Commission  to  start  implementing  the  Fund,  in  particular  in  view  of  a  first  call  for 
project proposals to be launched by mid-2020, the necessary budgetary structure needs to be created in 
the 2020 budget. The Commission therefore proposes to create three new budget lines: one in the the 
Statement  of  Revenue  of  the  Commission  section,  Article 6 3 7  intended  to  receive  the  external 
assigned  revenue;  two  in  the  Statement  of  Expenditure  of  the  Commission  section,  Article 34 03 01 
and Item 34 01 06 01, intended to cover the operational and administrative expenditure (fully covered 
by external assigned revenue) which is needed for the implementation of the Innovation Fund by the 
Commission in accordance with Article 4 of Commission Delegated Regulation (EU) 2019/856. 

In accordance with paragraph 1 of Article 22 of the Financial Regulation, all budget lines created for 
the Innovation Fund would have a token entry ‘pro memoria’ (p.m.). The budget remarks proposed for 
these  new  lines  are  shown  in  the  budgetary  annex.  The  proposed  budgetary  structure  will  allow  for 
reporting on the implementation of the Innovation Fund as part of the annual accounts. 

5.2   European Union Agency for the Operational Management of Large-Scale IT Systems in 

the Area of Freedom, Security and Justice (eu-LISA) 

As a result of a clerical  error, the payment appropriations for this item as published in the DB 2020 
were not in line with the needs of the agency as presented in the Working Document III annexed to 
the Statement of Estimates 2020. It is therefore proposed to decrease the payment appropriations for 

9 

 
  
 
 
eu-LISA by EUR 21,8 million, giving a total of EUR 196 million, which represents the actual needs of 
the agency for 2020.  

Budget line 

Name 

European  Union  Agency 
the  Operational 
Management of Large-Scale IT Systems in the Area 
of Freedom, Security and Justice (eu-LISA) 

for 

18 02 07 

Total 

Commitment 
appropriations 

Payment 
appropriations 

in EUR 

- 

- 

-21 794 627 

-21 794 627 

10 

 
  
 
 
 
 
6. 

SUMMARY TABLE BY MFF HEADING 

Heading 

Draft Budget 2020 

Amending Letter 1/2020 

Draft Budget 2020 

(incl. AL1/2020) 

CA 

PA 

CA 

PA 

CA 

PA 

1. 

Smart and inclusive growth 

83 328 329 504 

72 150 922 336 

83 328 329 504 

72 150 922 336 

Of which under global margin for commitments 

 141 890 522 

Ceiling  

Margin 

83 661 000 000 

 474 561 018 

 141 890 522 

83 661 000 000 

 474 561 018 

1a 

Competitiveness for growth and jobs 

24 716 438 982 

22 108 515 486 

24 716 438 982 

22 108 515 486 

1b   Economic  social and territorial cohesion 

58 611 890 522 

50 042 406 850 

58 611 890 522 

50 042 406 850 

Ceiling 

Margin 

25 191 000 000 

 474 561 018 

25 191 000 000 

 474 561 018 

Of which under global margin for commitments 

 141 890 522 

Ceiling 

Margin 

58 470 000 000 

 141 890 522 

58 470 000 000 

2. 

Sustainable growth: natural resources 

59 994 906 170 

58 014 263 718 

- 49 700 000 

- 49 700 000 

59 945 206 170 

57 964 563 718 

Ceiling 

Margin 

60 421 000 000 

 426 093 830 

60 421 000 000 

 475 793 830 

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

43 531 805 687 

43 501 731 798 

- 49 700 000 

- 49 700 000 

43 482 105 687 

43 452 031 798 

Sub-ceiling 
Rounding difference excluded from margin 
calculation 

43 888 000 000 

  888 000 

43 888 000 000 

  888 000 

3. 

Security and citizenship 

3 729 074 489 

3 723 911 857 

- 21 794 627 

3 729 074 489 

3 702 117 230 

 778 074 489 

2 951 000 000 

Of which under Flexibility Instrument 

 778 074 489 

2 951 000 000 

4.  Global Europe 

Ceiling 

Margin 

Ceiling 

Margin 

10 307 572 239 

8 986 061 191 

10 307 572 239 

8 986 061 191 

10 510 000 000 

 202 427 761 

10 510 000 000 

 202 427 761 

5. 

Administration 

10 324 060 577 

10 327 063 787 

 16 118 589 

 16 118 589 

10 340 179 166 

10 343 182 376 

Ceiling 

11 254 000 000 

Of which offset against Contingency margin 

- 252 000 000 

Margin 

 677 939 423 

11 254 000 000 

- 252 000 000 

 661 820 834 

Of which: Administrative expenditure of the 
institutions 

7 985 277 215 

7 988 280 425 

 16 118 589 

 16 118 589 

8 001 395 804 

8 004 399 014 

Of which offset against Contingency margin 

- 252 000 000 

Sub-ceiling 

9 071 000 000 

Margin 

 833 722 785 

9 071 000 000 

- 252 000 000 

 817 604 196 

Total 

167 683 942 979 

153 202 222 889 

- 33 581 411 

- 55 376 038 

167 650 361 568 

153 146 846 851 

Of which under Flexibility Instrument 

Of which under global margin for commitments 

 778 074 489 

 141 890 522 

 849 779 197 

- 14 914 951 

 778 074 489 

 141 890 522 

 834 864 246 

Ceiling 

168 797 000 000 

172 420 000 000 

168 797 000 000 

172 420 000 000 

Of which offset against Contingency margin 

- 252 000 000 

Margin 

1 781 022 032 

20 067 556 308 

- 252 000 000 

1 814 603 443 

20 108 017 395 

Other special Instruments 

 587 763 000 

 418 500 000 

Grand Total 

168 271 705 979 

153 620 722 889 

 50 000 000 

 16 418 589 

 50 000 000 

 637 763 000 

 468 500 000 

- 5 376 038 

168 288 124 568 

153 615 346 851 

11