Brussels, 20 April 2011
EU draft budget 2012: For 500 million Europeans in times of austerity
"A delicate balancing act combining austerity and growth boosting measures for 500 million Europeans". This is how Budget and Financial Programming Commissioner Janusz Lewandowski describes the draft EU budget 2012 as adopted by the Commission this 20 April 2011. The draft budget for 2012 represents € 132.7 billion in payments amounting to a 4.9 % increase on 2011. Commitments amount to €147.4billionn (+3.7%). The key objective of the 2012 Draft Budget is to fully support the European economy and EU citizens.
The draft budget 2012 endeavours to be in tune with the current austerity climate at national level. The Commission has made a particular effort and opted for a freeze of its administrative expenditure for 2012 i.e. a 0.0% increase compared to the 2011 budget. This has been achieved by significantly reducing expenditure linked to buildings, information and communication technology, studies, publications, missions, conferences and meetings. Furthermore, for the third year in a row, the Commission does not request any additional new post.
Also, in drawing up next year's draft budget, the Commission endeavoured to identify programmes or initiatives that are not performing. The Development Cooperation Instrument has been reduced by €70.7 million due to lower levels of funds absorption. The Industrialised Countries Instrument has seen a reduction of €14.5 million due to high levels of de-commitments in 2007 and delay in adoption of the new legal base. GALILEO funding has been reduced by €24.9 million (N.B. figures in commitments appropriations). "We owe it to the European taxpayer, says Commissioner Lewandowski: "savings must include looking seriously at what we are doing and asking ourselves whether everything we do brings genuine benefit to the whole of Europe!"
“Bills must be paid!”
However, the Commission must honour its legal commitments. EU funded programmes launched in 2007 are now running at full speed. This means that in 2012 we will have more bills to pay to reimburse regional authorities or SME's that have invested in those programmes. In particular, increased payment levels for the Research Programmes (+ 13.3% to €7.6 billion) and for the structural and cohesion funds (+ 8.4 % to €45.1 billion) aim at maximising the EU budget contribution to economic growth and cohesion.
The proposed increase for next year’s budget amounts to the bare minimum required to honour the Commission’s legal commitments. Any decrease below this figure would require member states and the European Parliament to break the legal commitments that have been made on existing contracts.
"Some ask why we would increase the EU budget when Member States face severe austerity measures at home", says Janusz Lewandowski; "this is a legitimate question. The main reason for the increase is that we must pay the bills coming from projects from across Europe. Such projects that benefit local communities and businesses would probably never have been launched back in 2007 without the commitment of EU funding; to stop funding them is unthinkable. Firstly we could be sued for not respecting the terms of the contracts, secondly, this would harm Member States' budget even more since they expect us to reimburse the EU share of the funding that they have already paid to beneficiaries; thirdly, stopping such projects half-way through would be detrimental to whole communities. We cannot punish our citizens, companies, local and regional authorities who have a right to get their bills paid. Think for instance of the electric interconnection between the United Kingdom and Ireland. The overall EU contribution to this project is over €100 million! Its aim is to give Irish and British citizens greater security of power supply. In 2012, the bills the EU will have to pay for this project will amount to some €24million, more than twice as much as in 2011."
For sustainable economic growth
The way forward towards economic growth and cohesion in a Union of 27 Member States is through concerted efforts and investments. The Draft Budget foresees some €57.7 billion to be paid in 2012 for sustainable growth to help Member States increase their investments in these areas whereas some € 62.6 billion is dedicated to the Europe 2020 priorities, an increase of 5.1% on the previous year.
Citizens are at the centre of the European policy and their safety is a high priority for the EU. The 2012 Draft Budget foresees a 6.8 % increase in the area of Freedom, Security and Justice with actions focusing on the interests and needs of citizens. Furthermore, under the EUROPE 2020 initiatives actions for Youth amount to € 1.9 billion, which is 15.0 % more than in 2011. Also Climate change activities have an important place. An increase of 6.1% is planned in 2012 to achieve € 8.1 billion in total.
For 500 million Europeans
Only 6% of the EU budget go to the functioning of the EU institutions, therefore 94% of the annual budget goes back to Europe's regions and towns, business, scientists and citizens, with half of it being geared towards growth and employment.
"The Draft Budget adopted today focuses on the EU and its citizens. Firstly we propose cuts in many areas of administration such as staff training, publications, travel and office expenditure in order to keep the portion on internal costs at the lowest level; secondly we have gone to great lengths to identify areas of the budget that were not performing as well as expected to shift funds towards programmes or initiatives that deliver concrete results on the ground. Thirdly we have opted for investing in areas that contribute to economic growth and development: the EU budget is an anti-crisis package! ", says Janusz Lewandowski.
DRAFT BUDGET 2012 AT A GLANCE
1. Sustainable Growth
— Competitiveness for growth and employment
— Cohesion for growth and employment
2. Preservation and Management of Natural Resources
3. Citizenship, Freedom, Security and Justice (3)
— Freedom, security and justice
— Citizenship (3)
4. EU as a Global Player
Appropriations as % of GNI
(1) Budget 2011 includes amending budget 1 and draft amending budgets 2 to 3.
(2) The margin for heading 1a does not take into account the appropriations related to the European Globalisation adjustment Fund (EUR 500 million).
(3) Excluding EU Solidarity Fund
(4) The margin for heading 4 does not take into account the appropriations related to the Emergency Aid Reserve (EUR 258.9 million).
(5) For calculating the margin under the ceiling for heading 5, account is taken of the footnote (1) of the financial framework 2007-2013 for an amount of EUR 84 million for the staff contributions to the pensions scheme.
(1): CA = Commitment appropriations. PA = Payments appropriations
DRAFT BUDGET 2012 IN COMMITMENTS
The Council will make its position known on the Draft Budget in June, followed by the European Parliament in October. In case of disagreements between them, a 21-day conciliation procedure will be triggered with the European Commission in the role of the honest broker. The final 2012 budget is expected to be adopted by the Parliament in November.
More information on draft budget 2012: http://ec.europa.eu/budget/index_en.cfm