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IP/07/1380

Brussels, 24 September 2007

Budget 2006: Improvement in quality of EU spending is confirmed

The latest financial data for 2006 confirms positive trend in the EU's budgetary development. More funding for competitiveness was ensured by further modernisation of expenditure; improvements in monitoring and planning kept the budget execution rate at a historically high level; and the substantial increase of the EU-10 countries' share of the budget secured their growing participation in EU policies. The "EU Budget 2006 Financial Report", released today, proves the EU's continued devotion to the Growth and Jobs agenda.

"2006 was the closing year of the previous financial period, which saw an almost 70% increase in spending on Competitiveness for Growth and Employment," commented Commissioner Dalia Grybauskaite, European Commissioner for Financial Programming and Budget. Specifically in 2006, funding directly devoted to competitiveness increased by 19% as compared to 2005.

Out of EUR 106.6 billion executed in 2006 more than 37% was spent to promote Cohesion and Competitiveness for growth and employment in all EU Member States. 35% went in direct aid and market related expenditure and 12% for rural development, fisheries and environment. 5% was devoted to strengthening the EU as a global player.

As much as 91% of EU expenditure, more than EUR 97.4 billion was spent within the EU-25 Member States. The five biggest Member States got EUR 57.8 billion or nearly 60% of total expenditure within the EU-25. The largest recipients were the most populous Member States: France (EUR 13.5 billion), ahead of Spain (EUR 12.9 billion), Germany (EUR 12.2 billion), Italy (EUR 10.9 billion) and the United Kingdom (EUR 8.3 billion; apart from the UK correction which was EUR 5.2 billion in 2006).

The share of EU-10 practically doubled as compared to the year of their accession (2004) and grew by EUR 2.4 billion to EUR 11.5 billion or nearly 12% of total expenditure within the EU-25. The main beneficiaries were: Poland (EUR 5.3 billion, up by EUR 1.3 billion from the previous year), Hungary (EUR 1.8 billion, up 0.5 billion) and the Czech Republic (EUR 1.3 billion, up 0.3 billion). In addition almost EUR 1.1 billion in pre-accession payments went to Romania and Bulgaria.

"This was globally a positive performance for new Member States as all of them received more money from the EU budget than in 2005. Yet, they need to do better this year, especially in the cohesion policy " – reminded Dalia Grybauskaite, Commissioner for Financial Programming and Budget. In 2007, for the very first time, money available from structural funds but not spent by them might be automatically cancelled under the "n+2" rule.

Spain retained the biggest share of funds for structural actions (EUR 5.8 billion or 17.8% of EU total), followed by Italy (14.0%), Germany (13.6%), Greece (11.1%) and the United Kingdom (9.3%).

As in previous years France was the largest recipient in agriculture (EUR 10.1 billion or 20.3% of EU total), ahead of Spain and Germany (13.4% and 13.2% respectively), Italy (11.0%) and the UK (8.7%).

Summarizing the 2000-2006 period Commissioner Grybauskaite noted that the biggest increases in EU spending were registered in the areas of Freedom, security, justice and citizenship (+78%) and Competitiveness for Growth and Employment (+68%). This trend will be further boosted over the period 2007-2013.

In the past seven years Spain was the biggest recipient of all EU funds (EUR 99,5 billion over the period), followed by France (EUR 89,6 billion), Germany (EUR 79,1 billion), Italy (EUR 70,2 billion) and the United Kingdom (EUR 50,2 billion; apart from the UK correction, which totalled EUR 36,6 billion over the period).

Among the EU-10, for the period 2004-2006 covering their membership, Poland benefited the most (EUR 12.1 billion), ahead of Hungary (EUR 3,9 billion), the Czech Republic (EUR 3.2 billion), Lithuania (EUR 2.0 billion) and Slovakia (EUR 1.7 billion).

In 2006 total national contributions to the EU budget reached EUR 87.3 billion, an increase of less than EUR 0.6 billion compared to 2005. The main contributors did not change: Germany (20.1% of EU total), France (17.6%), Italy (13.7%), UK (11.3%, after the correction) and Spain (9.9%). The rest of the revenue came from traditional own resources (customs duties, agriculture duties and sugar levies for EUR 15.0 billion) collected by the Member States on behalf of the Union, the surplus from 2005 (EUR 2.4 billion) and other sources (EUR 3.7 billion).

In relative terms, when compared to EU wealth, the size of the EU budget decreased last year to 0.93% of EU Gross National Income, as compared to 0.97% in 2005.

The execution rate continues to improve and reached 99.3% in 2006. This progress is mainly due to better planning and monitoring by the Commission's services. The early warning system introduced into budget management through a joint effort of the Commission, the European Parliament and the Member States significantly contributed to this result.
The "EU budget 2006 Financial Report" can be found at:

http://ec.europa.eu/budget/publications/fin_reports_en.htm


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