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José Manuel Durão Barroso

President of the European Commission

Remarks by President Barroso on the Commission's proposals for the 2014-2020 Multi-Annual Financial Framework

Press Conference

Brussels, 29 June 2011

Good evening ladies and gentlemen,

The College has adopted today our proposal for a budget for the period 2014 to 2020. And, together with Commissioner Lewandowski, I just came back from the European Parliament where we had the opportunity to make the first presentation to the European Parliament. And now I would like to announce the main political lines.

I know that you are eager to learn the key figures, you find all of them in our document but I think it is important before giving the floor to Commissioner Lewandowski to put some of those proposals in the context, the political context we have discussed today in the Commission.

The European Union has a relatively small budget when we compare it to the overall expenditure made by all our Member States. It is a relatively small budget but we can make a big impact with it. That is what our proposal does. It responds to today's concerns, but also to tomorrow's needs, and focuses on where funding at EU level can provide true added value. In fact, one of the documents that is going to be with the budget is precisely this document "The Added Value of the European Union Budget" showing with concrete examples that many of these developments could not have happened without a European budget. This is an innovative budget. I invite you to look beyond the traditional headings and focus on how throughout the budget we will deliver the Europe 2020 goals that have been collectively defined. That is why we break from the culture of entitlement where some public authorities expect to spend funds just as they wish. Now every request must be clearly linked to the goals and priorities agreed commonly, namely with the Europe 2020 priorities. That is what I call political conditionality. This not just money that has to be spent anyhow, this is money that will be distributed related to very concrete priorities agreed by the member states and the European institutions. And this is the way to achieve a very important goal: that every euro spent can reach various polices. It can at the same time strengthen cohesion; boost energy-efficiency and the fight against climate change, and promote social targets for instance.

That is why I insist that it is important to look at the budget not just in terms of the traditional headings more or less driven by bureaucratic or constituency led considerations, but in terms of functions or goals. One same euro for instance for a program of interconnections in renewables between Germany, Poland and the Baltic countries. It is the same euro that is important for cohesion, territorial and economic cohesion, for energy efficiency, for our agenda to protect the environment, and climate change and many other examples. So this is very important because in times of severe financial constrains we need to make the most out of every euro spent.

We also focus on delivery where it really matters; with a range of measures to strengthen absorption of funding. For example, we propose to allow for a temporary increase in the co-financing rate by 5-10% when a Member State is under a financial assistance programme to help with the fiscal consolidation efforts in these countries either in euro area or outside euro area. This once again is very important because usually people look at the budget in terms of how much is there. But what matter is not really how much is there, is how much is really invested. The absorption capacities are critically important namely in the cohesion countries. We have just discussed the issue of Greece when I made clear that in the fifth year of the implementation of the structural funds only 25 percent, one quarter, has been effectively invested. So what we are now doing is to increase the capacity of the funding to reach their destinations. And once again those who benefit from the European funding is not like some people suggest Brussels. It is money for our regions, for our workers, for all over Europe.

The largest part of this budget will be aimed at getting people into work and growing the economy, tied in with the Europe 2020 strategy for smart, sustainable and inclusive growth. We need to be realistic in the current circumstances, Europe needs investments. This budget if for 2014 onwards so it would be a complete mistake because of the difficulties of the past to sacrifice the future of the European Union. Europe need rigour, at the same time Europe needs growth. And growth to be achieved needs investments and some investment at the European level to compliment what we do in the national level.

We will boost growth and jobs across the EU by linking cohesion policy much more strongly to our Europe 2020 vision. €376 billion will go to economic, social and territorial cohesion funding over the next 7 years. Included in this will be a new Connecting Europe Facility to build the missing links in energy, transport and information technology. With €40 billion, and an extra €10 billion from the Cohesion Fund, we will strengthen the integrity of the internal market, linking the East with the West and the North with the South. It will create real territorial cohesion to the benefit of all. Once again this is the typical example where money spent at the European level avoids duplication, in fact makes economies because when the member states make contradicting investments not using the synergies they will be in fact wasting money and at the same time it is the money spent typically it is needed to be spent in the European level because if not, and I can give many examples to you, it is easier to the member states to build a third highway that they do not really need in their territory than to build a connection to link different regions of Europe. So that is why there is a Pan-European logic and integration logic in the budget we are presenting.

The Connecting Europe Facility offers also opportunities for using innovative financing tools to speed up and secure greater investment than could be achieved only through public funding. That is why the Commission will promote the use of EU project bonds to bring forward the realisation of these important projects. Once again these are projects, for instance in energy and in transport, that are profitable, many of them in the medium or long term. So with the leverage effect of the European Investment Bank we can finance some projects to achieve these agreed goals

We will also boost growth and jobs across the EU by investing more in Europe's brains: €15.2 billion will be invested in education and vocational training, an increase by 68% in this type of expenditure; and €80 billion will be dedicated to research and innovation funding, an increase of 46%. These are areas crucial for Europe's global competitiveness so that we can create the jobs and ideas of tomorrow. I think it is important to be sure that we have more investment in these areas – the areas for increasing our competitiveness, namely in terms of research, science and education and culture.

Secondly, we will also make sure Europe is a safe place.

Safe and healthy food remains a priority with just over €280 billion set aside for the Common Agricultural Policy. Other areas grow while agriculture has not grown but we keep the stability of our support for farmers. That is important because it underpins a true common European policy of strategic importance, where more than 70% of the funding is no longer national and where EU funding makes it less expensive than 27 national agriculture policies. Let's be frank about this. Many people criticize the CAP and certainly the CAP needs reform and has been reformed over time, but there is clear commitment of the Commission to pursue this reform. But think for a while what would have happened if we did not have the CAP, we would have 27 different agricultural policies and I can tell you that Member States would have been spending much more than they have been spending today collectively and most likely they will try to break, they would have been breaking the Internal Market with protectionist measures against the others. And I have seen this, by the way, recently in some areas. So the CAP is indeed a policy that makes economy in terms of what will happen if we have 27 different national agricultural policies. It will be further modernised to deliver food safety and security, to better benefit the small farmer and to protect the environment. There will be the greening of the CAP. 30% of the direct payments will respond to conditionality in terms of greening. It illustrates once again how one euro can and must serve different goals.

A safe environment and tackling climate change will be written into all areas of the budget. The Commission intends to increase the proportion to at least 20%, with contributions from different policy fields subject to impact assessment evidence. So mainstreaming fight against climate change and mainstreaming our environmental concerns. A euro can boost energy-efficiency and the fight against climate change, at the same time it strengthens cohesion, and promotes social targets, and increases employment and indeed competitiveness and innovation in these vital sectors of our economy.

There is also our determination to provide safe borders. It will get a boost with €3 billion, going to amount of €8 billion, an increase of 57% on the current budget set aside to manage our external borders and tackling crime.

Thirdly, our budget will contribute to make Europe count in the world through an increased budget of €70 billion. Shifting alliances and emerging new powers mean that Europe must do more to make its voice count. € 16 billion will be allocated to our neighbourhood policy. And we will deliver on our commitments to help the poorest in the world. The Development and Cooperation Instrument (DCI) will receive €20.6 billion to focus on poverty eradication and to maintain our pledge to the Millennium Development Goals (MDGs). If we face tough times at the moment, the poorest of the world face the toughest of all times.

Mesdames et Messieurs,

Le principe de solidarité est aussi au cœur de notre proposition. Solidarité avec les Etats membres et les régions les plus pauvres. Solidarité dans la gestion commune de plusieurs défis dont l'immigration. Solidarité en termes de sécurité énergétique. Solidarité enfin avec les peuples des pays tiers les plus pauvres.

Défendre ce principe de solidarité, c'est aussi revenir aux principes fondateurs du projet européen. Ces 30 dernières années, nous avons lentement glissé dans une perception du budget européen où s'opposent des gagnants et des perdants. C'est pour cette raison que notre proposition de budget présente un volet "dépenses" qui est plus que jamais paneuropéen et qui regarde l'Union dans son ensemble. C'est un vrai budget d'intégration. C'est aussi pour cette raison que s'agissant des recettes, nous mettons sur la table des propositions pour assurer de véritables ressources propres pour l'Union européenne. C'est d'ailleurs ce qui est inscrit dans les traités. C'est ce qui est logique de tous les points de vue, notamment du point de vue de la transparence.

Nous proposons un nouveau système de ressources basé sur une taxe sur le secteur financier, sur les transactions financières pour être plus exact, et une nouvelle ressource qui partirait de la TVA actuelle.

Et pour ces mêmes raisons, le temps est venu de reformer le système des rabais et les mécanismes de correction et les corrections des mécanismes de correction où personne ne comprend ce qui se passe. Je crois qu'au monde il y aura peut-être quatre ou cinq personnes qui comprennent notre système de rabais, contre-rabais et correction de rabais. C'est vraiment d'une complexité infinie. Nous allons proposer un système beaucoup plus claire, plus juste, plus transparent. Dans le nouveau système, il n'y a pas de place pour la notion de "juste retour". Solidarité implique que ceux qui sont relativement plus riches et prospères contribuent relativement plus. Mais solidarité implique aussi que des contributions nationales ne peuvent devenir disproportionnées au regard de la richesse relative du pays. Donc on aura un système de correction pour les pays qui seraient forcés à un niveau d'effort disproportionné par rapport à leur prospérité relative.

Je crois que ce que nous proposons aujourd'hui est un budget ambitieux. C'est aussi un budget responsable. Nous avons fait des économies dans certains domaines pour pouvoir dépenser plus sur les priorités du présent et de l'avenir.

Le cadre financier 2007-2013 s'élève à 1.05% du PIB en engagements et à 1% en paiements. Nous reprenons ces chiffres tels quels dans le nouveau cadre financier.

Les chiffres clés sont donc les suivants:

  • 1,05% du Produit Intérieur Brut en engagements – c'est à peu près la situation d'aujourd'hui.

  • 1% en paiements – aussi à peu près la situation d'aujourd'hui.

  • 0,06% est proposé en dehors du MFF et du budget pour des initiatives tels que le Fonds Européen de Développement, qui resteront en dehors du budget ou d'autres initiatives telles que ITER.

Le Parlement européen, les Etats membres et la Commission doivent maintenant transformer ces propositions en accord. Je m'attends, je suis très sincère comme toujours avec vous, à des débats très difficiles dans les prochains mois, mais je suis convaincu qu'avec un vrai esprit européen de part et d'autre, nous pourrons nous accorder sur un budget ambitieux, qui pourra avoir un impact réel sur la vie des citoyens, qui pourra réaliser les buts que collectivement nous avons défini pour toute notre Europe.

Je vous remercie pour votre attention.

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