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European Commission

Statement

Brussels, 24 October 2014

Statement by President Barroso on the budget contributions

I have to give an explanation of what is happening exactly, as it's a complex issue. I fully understand the surprise and also the concerns expressed by some Prime Ministers, but I want to show that there are some reasons for the documents produced by the Commission. Once again, I ask you for your patience because I think it is important to have the accurate information on this topic.

This is an annual exercise based on figures given by each Member State through their own statistical offices. This is the first point. The figures we have now worked out were the exact figures that were given to us by the National Statistics Office of the United Kingdom. This should not have come as a surprise to the Member States, as the maths are based on the own resource decision they have agreed unanimously.

The European Commission did not create this situation and for some years we have been the ones proposing to move to a different system. And this was rejected by the Member States. So we have to use the system the Member States created, which is based on the GNI (gross national income). So when there are changes in the GNI of the countries, we have to adapt the statistics and the contributions of the countries. We have been careful not to politicise the process we have been asked to administer.

Today, together with the next President of the Commission, Jean-Claude Juncker, I have agreed that the Commission will now give further technical explanations about this annual process. There will be a hearing of finance ministers, where, of course, we are ready to provide all information, being clear that we cannot have a negotiation about the GDP of the different countries. It's impossible to have negotiations about GNI. This should be left to, of course, independent statistics authorities.

The EU must have a balanced budget. So every year we undertake an exercise to ensure all Member States are paying in the level of contribution they should, and that the revenues which the EU budget has obtained through, for example, competition fines, are returned to Member States. So this is an exercise where sometimes countries are asked to give more money, and sometimes they receive much more money. Because, for instance, all the proceeds of competition, the fines, go back to the national treasuries. So it's not, as some people might think, that the Commission is asking for more money. Sometimes it is the case, sometimes it is the opposite. I would say many times it's the opposite.

Every year, in the autumn, the Member States' contributions to the EU budget are recalculated in line with the updated statistical base. Each national statistical office has notified its updated GNI figures and these have now been considered correct by Eurostat. Eurostat, I want to remind you, is a completely independent body. We are very much attached to the principle of statistical independent. The Commission, the President of the Commission of the Commission in charge, cannot give instruction to Eurostat. We have taken considerable steps to ensure the independence of this process, and I think this is now an acquis that should not be put in question.

The impact of the updated GNI figures on the contributions of each Member State is implemented on the first working day of December. These, once again, are the rules that have been adopted by the Member States themselves. In the own resources legislation, which was agreed by unanimity and ratified by all national parliaments, the administrative power to make this technical adjustment is given to the Commission, and does not require a decision by the budgetary authority.

If the balances are important, such as this year, the Commission proposes an Amending Budget (in our case, Amending Budget 6/2014) to return the extra revenue to the Member States. This requires adoption by both arms of the budgetary authority. We are recommending a rapid adoption by the budgetary authority (by qualified majority in Council) since the money can then be returned to the Member States quickly.

These corrections are made every year. In some years the net effect will be to increase a Member State's contribution. That is the case for the UK, The Netherlands and some others this year. In other cases, the net effect will be to reduce the contribution. This was the case for the UK in 2008. The Commission is, of course, ready to provide the Member States with any additional explanations.

In the context of the MFF (the multiannual financial framework), the Commission had proposed different criteria for establishing the EU budget through own resources rather than GNI. Member States in the Council insisted on maintaining GNI as a key element of the budget calculation base. The statistical effect has therefore been built into the system by the budgetary authority.

So according to information I received from the Commission's services, from my legal experts, this was a decision taken in full independence by the statistical entities. I understand, of course, the concerns it has raised in London, but any person that has to look with objectivity and honesty to the rules that were approved by the Member States has to accept that sometimes these decisions happen.

I cannot speculate now about non-payment. What I can tell you is that we have agreed with the President of the new Commission, because this is going to be dealt with by the new Commission, that there will be a meeting of finance ministers with the Commission to look at this issue, to have an opinion about this issue, to give all the information that was agreed. But, of course, at this moment I do not have any more comments on this matter.

Contacts :

Pia Ahrenkilde Hansen (+32 2 295 30 70)

Mark Gray (+32 2 298 86 44)

For the public: Europe Direct by phone 00 800 6 7 8 9 10 11 or by e­mail


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