Debate: Presentation by the Council of its position on the draft general budget -  financial year
Date: TUESDAY, 14 SEPTEMBER 2021
Speaker: Irena Drmaž
Language: EN

We have seen over the summer the changing situation that can occur at any time through natural or other disasters, and the recent international events will surely generate future uncertainties in many areas such as border management, humanitarian aid and migration. It is therefore very important for the Council to foresee sufficient margins in the budget to face the challenges and risks that may await us also next year.  Let me emphasise that in these challenging and dynamic times, we are fully aware of the responsibility as budgetary authority to fulfil the expectations of EU citizens to bring forward a balanced and forward-looking budget for 2022. As always, the Council will call for prudence and financial discipline. In the current situation we need to be careful about how the EU taxpayers’ contributions are spent. The Presidency will do its utmost to conclude a budget for next year that will take the EU forward, focusing on the main objectives of the Union and benefits for the citizens.  We have worked on the Commission’s proposal since its presentation on 8 June. I am pleased to say that after careful reflection, the Council has reached a well-balanced position adopted with unanimity on 6 September. The Council position foresees an amount of EUR 167.6 billion in commitment appropriations and EUR 169.9 billion in payments appropriations. They correspond, respectively, to 1.12% and 1.14% of the EU GNI – gross national income – and ensure a quick and substantial progression of the main beneficiary programmes. On operational expenditure: for Headings 1-6 the Council proposes some adjustments in the commitment appropriations to take into account the delays in the adoption of legal bases and to guarantee a balanced evolution of expenditure until 2027. This is in particular relevant for the programmes that benefit from top-ups from Article 5 of the MFF Regulation and significant additional appropriation from the assigned revenues that come from the Next Generation EU (NGEU).  Based on a realistic view on the absorption capacity of beneficiaries and national and European administrations, we expect the implementation of several programmes in 2022 to be lower, as foreseen by the Commission. We therefore propose to backload the financing of some programmes to the second part of the MFF period. In addition, we advocate not using Article 15(3) of the Financial Regulation in 2022, but to backload the proposed amounts to the second part of the MFF period. We should ensure appropriate funding of Horizon also after the top-ups from NGEU. I would like to stress the fact that a large number of key programmes across all headings have been accepted at the level of the Commission’s draft budget. This is the case, for instance, for programmes under economic, social and territorial cohesion, as well as for agriculture, which represent the largest budget shares. Concerning Heading 6, the Council intends to adjust the NDICI by reducing the cushion and ring-fencing the Commission’s margins for manoeuvre for next year and by adjusting the appropriations of the Common Provisioning Fund, yet allowing for a prudent provisioning or related compartment. As regards payment appropriations, most of the proposed savings are due to the repayment costs of the funds borrowed in the capital markets in the framework of the European Recovery Instrument to take into account the lower interest rates, both current and expected. The Council does not propose any changes to the complexion lines to ensure smooth payments from previous years. On administrative expenditure: following the guidance given by our leaders, the Council has consistently advocated strict discipline on both staffing levels and non-salary related expenditure for all institutions. Therefore, we have reduced Heading 7. In this context, I would like to draw your attention to the issue that raised great concern in all Member States, the proposal of the European Parliament to increase significantly its establishment plan and the number of its external staff for the next year. The Council reserves its position on these proposals. We would like to better understand the rationale behind such an important increase.  Concerning the decentralised agencies, we propose to adjust lines for expenditure for some of those agencies as cruising speed when their increase is higher than 2%. However, we did not propose any adjustments to the decentralised agencies with new tasks, with the only exception of the European Border and Coast Guard Agency, Frontex, for which certain appropriations are backloaded to the financial years 2023-2027 and a certain amount is put to a reserve. On special instruments: the Council proposes to maintain the appropriations entered into draft budgets for 2022 for the Solidarity and Emergency Aid Reserve, the European Globalisation Adjustment Fund and the Flexibility Instrument. It also proposes to introduce in the Brexit Adjustment Reserve line the amount agreed by the co-legislators for both commitment and payment appropriations for 2022.  It is also worth noting that two Council statements are attached to our position, one of them being the traditional one concerning sufficient payment appropriations in the area of agriculture and cohesion, while the other refers to Next Generation EU repayments. The Council will reassess its position once the Commission presents all the missing elements in its letter of amendment to the draft budget which is expected during the month of October.  Let me conclude by saying that I hope today is the beginning of a series of constructive and open exchanges which will allow us to reach a balanced and meaningful compromise on the budget for 2022. Without deviating from our common goals we will have to prioritise and demonstrate our strong commitment to Europe, and I am convinced we will be able to find a common position within agreed timeframe.