CELEX: 51988PC0257
Language: en
Date: 1988-04-27
Title: PROPOSAL FOR A COUNCIL DECISION CONCERNING BUDGETARY DISCIPLINE

N o C 146/22                           Official Journal of the European Communities                                  3. 6. 88
— the Commission may defer application of the                      this Decision and in conformity with the provisions of
     measures which it has decided for a period of not             Article 2 paragraph 2 of the Framework Programme.
     more than one month from the date of such
    communication,                                                                         Article 10
— the Council, acting by a qualified majority, may take            1.    With regard to the concertation activities provided
    a different decision within the time limit referred to         for in Article 1 (2), the Member States and the
    in the previous paragraph.                                     Commission shall exchange all appropriate information
                                                                   to which they have access and which they are free to
                          Article 9                                disclose concerning activities in the areas covered by this
                                                                   Decision, whether or not planned or carried out under
 1.    The result of the programme shall be reviewed by            their authority.
the Commission after 18 months. The Commission shall
report to the Council and the European Parliament on               2.    Information shall be exchanged according to a
the results of this review, (together with any proposals           procedure to be defined by the Commission after
for modification or prolongation of the programme                  consulting the Committee, and shall be treated as
which the Commission deems appropriate).                           confidential at the supplier's request.
2.     After the completion of the programme, the
                                                                                           Article 11
Commission shall send to Council and European
Parliament a report on the performance and results of             This Decision shall apply from 1 June 1988.
the programme.
                                                                                           Article 12
3.     The abovementioned reports will be carried out in
relation to the precise objectives set out in Annex II to         This Decision is addressed to the Member States.
                              Proposal for a Council Decision concerning budgetary discipline
                                                      COM(88) 257 final
                                      (Submitted by the Commission on 27 April 1988)
                                                        (88/C 146/11)
THE COUNCIL OF THE EUROPEAN COMMUNITIES,                          Whereas rules on budgetary discipline as regards non-
                                                                  compulsory expenditure will be laid down in a joint
                                                                  declaration by Parliament, the Council and the
Having regard to the Treaties establishing the European
                                                                  Commission;
Communities, and in particular Articles 43 and 235
thereof,
                                                                  Whereas the European Council on 11, 12 and 13
                                                                  February agreed the principles of a guideline for the
Having regard to the proposal from the Commission,                control of agricultural expenditure;
                                                                  Whereas the rate of progression of EAGGF Guarantee
Having regard      to   the   opinion   of   the   European
                                                                  Section expenditure must not exceed 74 % of the rate of
Parliament,
                                                                  increase in Community GNP, this rate corresponding to
                                                                  that of 80 % of maximum EAGGF financing of set-aside
Whereas the European Council has agreed that the                  is taken into consideration;
Community must submit the use of its own resources to
effective and legally binding discipline parallel to the          Whereas the European Council has also agreed to mech-
efforts being made by the Member States in connection             anisms for the systematic depreciation of existing and
with their own budgets;                                           future agricultural stocks so that the stock situation can
                                                                  be normalized by 1992;
Whereas the arrangements for budgetary discipline
                                                                  Whereas the stabilization mechanisms provided for in the
decided upon by the European Council at Fontainebleau
                                                                  provisions governing the common organization of
must be strengthened in the light of experience;
                                                                  markets should play a part in ensuring compliance with
                                                                  the agricultural guideline;
Whereas budgetary discipline must be applied to all the
Community's expenditure; whereas it must cover both               Whereas the European Council has also agreed that the
payment and commitment appropriations;                            level of EAGGF Guarantee Section expenditure may be
 ---pagebreak--- 3. 6. 88                               Official Journal of the European Communities                             No C 146/23
influenced by movements in the USA dollar/ECU                     amounts corresponding to the disposal of ACP sugar,
market rate, and that to cover developments caused by             food-aid refunds, sugar and isoglucose levy payments by
significant and unforeseen movements in the USA                   producers, and any other revenue raised from the agri-
dollar/ECU market rate compared to the rate used in               cultural sector in the future.
the budget a Monetary Reserve of 1 000 million ECU
shall be entered each year in the budget in the form of
provisional appropriations;                                                                 Article 4
                                                                  The agricultural guideline shall include costs relating to
Whereas it is necessary that compulsory expenditure               depreciation of newly-created agricultural stocks. Each
                                                                  year the Council shall enter in its draft budget the appro-
other than EAGGF Guarantee Section expenditure be
                                                                  priations necessary for financing all costs relating to
subject to budgetary rigour and planning;
                                                                  depreciation of new stocks. The appropriations shall be
                                                                  used for the systematic depreciation of the new stocks,
"Whereas the Treaty makes no explicit provision for the           which shall start when these are formed, in accordance
powers required to adopt measures of budgetary                    with the provisions which will be inserted in Regulation
discipline in respect of expenditure outside agriculture;         (EEC) No 1883/78.
Whereas it is therefore necessary to rely on Article 235          The cost of depreciating existing surplus agricultural
for the inclusion of such expenditure within the scope of         stocks shall be met outside the agricultural guideline.
budgetary discipline,                                             The following amounts shall be included in Title 8 of the
                                                                  budget for the period 1988 to 1992 (1988 prices):
                                                                  — 1988: 1 200 million ECU,
HAS DECIDED AS FOLLOWS:
                                                                  — 1989 to 1992: 1 400 million ECU.
          EAGGF Guarantee Section expenditure
                                                                  These amounts may not be used for any other purposes.
                         Article 1                                The procedures for the financial compensation granted
The rate of increase in EAGGF Guarantee Section                   to Spain and Portugal in respect of their contribution to
expenditure — as defined in Article 3 — between 1988              the financing of these stocks will be dealt with in a
and a given year must not exceed 74 % of the rate of              separate instrument. These two States shall be treated as
increase in Community Gross National Product during               if the depreciation of stocks had been entirely financed
                                                                  by the Community in 1987.
the same period.
This maximum progression for EAGGF Guarantee                                                Article 5
Section expenditure (the EAGGF Guarantee Section                  The Commission's price proposals shall be consistent
guideline), which would correspond to 80 % if                     with the limits laid down by the agricultural guideline.
maximum EAGGF financing of set-aside were taken into
consideration, must be respected each year.
                                                                  If the Commission considers that the outcome of the
                                                                  Council's discussions on these price proposals is likely to
                         Article 2                                exceed the costs put forward in its original proposal, the
                                                                  final decision shall be referred to a special meeting of the
The 1988 base of expenditure from which the guideline             Council.
for each subsequent year is calculated is 27 500 million
ECU, to be adjusted according to Article 3. The stat-             The agricultural guideline must be respected each year.
istical base with regard to G N P statistics will correspond
to that used in Decision . . . (own resources Decision).
All calculations which will be made by the Commission                                       Article 6
at the time of submitting its annual price-fixing proposal,
subject to a possible final review at the time of                 To ensure that the guideline is respected, the
submitting the preliminary draft budget for the following         Commission shall establish an 'early warning system'
year, will be established in 1988 prices and converted            covering the development of expenditure of the indi-
into current prices by the use of the G N P deflator              vidual EAGGF Guarantee Section expenditure chapters.
estimated by the Commission for the year in question.             Before the beginning of each budget year the
                                                                  Commission shall define expenditure profiles for each
                                                                  EAGGF Guarantee Section budget chapter based on the
                                                                  monthly expenditure over the preceding three years. The
                          Article 3
                                                                  Commission shall submit monthly reports thereafter to
The expenditure to which Article 1 applies shall be the           the European Parliament and the Council on the devel-
expenditure chargeable to Section III, Part B, Titles 1           opment of actual expenditure against profiles. Where the
and 2 (EAGGF Guarantee Section) of the budget less                rate of development of expenditure is exceeding the
 ---pagebreak--- No C 146/24                            Official Journal of the European Communities                                 3. 6. 88
forecast profile, or risks doing so, the Commission shall         Guarantee Section of up to 1 000 million ECU shall be
use the management powers at its disposal, including              transferred to the Monetary Reserve. Where additional
those which it has under the stabilizing measures, to             budgetary costs are engendered by a fall in the dollar
remedy the situation. If these measures are insufficient,         against the ECU compared with the budget rate, the
the Commission shall examine the functioning of the               Monetary Reserve shall be called up and transfers shall
agricultural stabilizers in the relevant sector and, if           be made from the Monetary Reserve to the EAGGF
necessary, shall present proposals to the Council                 Guarantee Section lines affected by the fall in the dollar
calculated to strengthen their action. The Council shall          and the necessary own resources shall be called up, in
act within a period of two months in order to remedy              accordance with the Decision on own resources and the
the situation.                                                    provisions adopted pursuant thereto, to finance the
                                                                  corresponding expenditure.
                          Article 7
                                                                  Any saving made in the EAGGF Guarantee Section
Payment of the monthly EAGGF Guarantee Section                    which has been transferred to the Monetary Reserve in
advances by the Commission shall be effected on the               accordance with the first paragraph of this Article and
basis of the information supplied by the Member States            which remains in the Monetary Reserve shall be
in regard to agricultural expenditure for each common             cancelled and thus contribute to a budgetary surplus
market organization.                                              which shall be counted as a revenue item in succeeding
                                                                  budgets. This shall be done by means of a letter of
                          Article 8                               amendment during the budgetary procedure concerning
Where no appropriations are available, the Commission             the budget for the coming year.
shall propose transfers to the budget authority.
                                                                                           Article 13
                          Article 9                               There shall be a franchise of 400 million ECU. Savings
The USA dollar/ECU rate used to draw up the annual                or additional costs below this amount will not necessitate
budget estimates of EAGGF Guarantee Section expen-                transfers to or from the Monetary Reserve. Savings or
diture for year n shall be the average market rate over           additional costs above this amount will be paid into or
the first three months of year n—1. However, the rate             met from the Monetary Reserve.
used in the budget for 1988 shall be 1 USA dollar =
0,85 ECU.                                                                      Other Compulsory Expenditure
                         Article 10                                                        Article 14
1 000 million ECU shall be included annually in the               Each year, at the start of the budget procedure, the
reserve, Chapter 100 of the general budget of the                 Council shall adopt a reference framework for
Communities, as a provision for covering developments             compulsory expenditure other than EAGGF Guarantee
caused by significant and unforeseen movements in the             Section expenditure. The reference framework shall
dollar/ECU market rate compared to the USA dollar/                include the maximum amounts for both commitment and
ECU rate used in the budget. These appropriations shall           payment appropriations which the Council considers
not be included in the agricultural guideline.                    necessary with due regard for the Community's legal
                                                                  liabilities.
                         Article 11
Each October, the Commission shall report to the                                Non-compulsory Expenditure
budget authority on the impact on EAGGF Guarantee
Section expenditure of movements in the average USA                                        Article 15
dollar/ECU market rate for the period 1 August of year
n—1 to 31 July of year n compared to the rate used in             Budgetary discipline for non-compulsory expenditure
the budget, as defined in Article 9.                              shall operate on the basis of the arrangements contained
                                                                  in the joint declaration between Parliament, the Council
                         Article 12                               and the Commission.
Savings or additional costs resulting from movements in                                    Article 16
the rate shall be treated in a symmetrical fashion. Where
favourable changes take place in the USA dollar/ECU               The above provisions shall remain in force for the
rate compared to the budget rate, savings in the                  duration of the own resources Decision.