Someone might see an ironic contradiction in the two announcements we see today on the web pages of Libertas.eu:
1) The European elections begin in some 28 days.
2) Policies: The Libertas programme for a better Europe will be published on this site in the coming weeks.
***
Waiting for Godot, we turn to what Libertas has on offer regarding the future of Europe and the next five years of legislative work in the European Parliament.
The third core principle of Libertas is:
“Save money: €10 billion in savings to be identified by the Commission in the next financial year.”
Sounds great, doesn’t it? At least until you take a closer look. Let’s do that.
***
Long term budget
The European Union lives by the multiannual financial framework essentially set by the heads of state or government of the member states, currently from 2007 to 2013, although formalised by an agreement between the institutions.
Income and expenditure hover around 1 per cent of gross national income (GNI) annually, far from a federal budget of proportions.
***
Annual budget
The framework is the basis for the expectations of the EU member states and for recipients of EU funds until the end of 2013.
The annual budgets are prepared within this framework by the Commission, and approved by the Council and the Euroepan Parliament.
Based on the existing framework and legitimate expectations, the Commission presented its preliminary draft budget for 2010 on 29 April 2009.
Mainly within the framework constraints, but with new measures towards an economic recovery, the proposed sum total of expenditure grows to € 139 billion. This translates into about 284 euros per EU resident.
How does a radical proposal for savings fit the economic circumstances and the timetable?
Even if the final vote on the budget takes place in December, the financial framework is in place until the end of 2013, and the European Council has given green light to certain recovery measures.
The budget exercise for 2010 is well under way. The Commission will take the opinions of the Council and the European Parliament into account before its final proposal. The Council and the EP will then fix their positions, before having to reconcile their views before final approval.
Nothing tells me that any of these institutions is going to veer off course to heed calls for unspecified budget cuts.
Libertas’ “core principle” is a figment of their imagination, meant to be swallowed by uninformed voters.
***
Who is responsible?
We have to admit that calls for profound change, including budget reform, can be justified even if they have no immediate chance of success. Every reform starts from modest beginnings until it gains acceptance.
What makes Libertas’ call hypocritical and cowardly is that they don’t even try to tell us where to cut. The savings should be identified by the Commission, without Libertas taking any responsibility.
In the realm of sanctimonious bluster, this is worth an Oscar.
The draft budget contains € 59 billion spending on agriculture and € 49.4 billion on structural funds. This is about 78 per cent of the total budget, and it is mainly spent in the member states.
Does Lisbertas want to cut back our dependence on subsidy-driven farming? Do they want to terminate “cohesion” funding in rich member states, or deprive the new member states of their structural funds?
Surely, a new political party with a “pan-European vision” knows where to save and has the guts to tell us(?)
The rest of the proposed budget (about 21.8 per cent) is shared between competitiveness, citizenship, freedom, security and justice, external action and administrative expenditure.
Even if the sums are minor in comparison, we need to be told about possible savings.
Ralf Grahn
P.S. A few observations outside the theme of this post: Libertas has introduced a certain professionalism and dynamic in its campaigning techniques during these last days. They contact people through e-mails and social media. Today there are several additional posts on their central web pages. Behind language barriers activists in different member states seem to be free to concoct wildly diverging messages without much outside notice.
In terms of (inter)active campaigning, the competition is still in the starting blocks. Despite the fact that the policies we have looked at this far have been shown to be populist rubbish, the established Europarties ignore Libertas at their peril.
Showing posts with label financial framework. Show all posts
Showing posts with label financial framework. Show all posts
Wednesday, 6 May 2009
Sunday, 4 November 2007
EU reform camp building
The Swedish Institute for European Policy Studies Sieps is looking around for allies for budget reform within the European Union. The annual conference of the Institute, on 26 October 2007, was dedicated to The Purse of the European Union: Setting Priorities for the Future. On Tuesday, 6 November 2007, Sieps and the Centre for European Policy Studies (CEPS) jointly host a seminar The EU Budget Review: Possibilities and Challenges for the Future.
At the Sieps conference Sweden’s EU minister Cecilia Malmström recollected that the current financial perspective of the European Union was a step in the right direction, but it was not far-reaching enough. She stressed the importance of the built-in review mechanism.
According to Malmström, citizens rightly expect the EU to use common funds well and efficiently. The Reform Treaty will lead to major improvements in this respect. The second major tool is a modern budget. The Swedish government believes that substantial reforms of EU spending – including re-prioritisation between areas of expenditure – are needed in order to achieve a budget that can contribute to the EU meeting the challenges of the 21st century.
Subsidiarity, European added value, proportionality and sound financial management are fundamental principles for a reform. The Swedish government has drawn some preliminary conclusions on the direction of the future EU policies: competitiveness, justice and home affairs, migration and asylum as well as external action.
The future Common Agricultural Policy (CAP) should be guided by market orientation, consumer demand, environmental concern, deregulation and reduction of budget expenditure.
The European Union could contribute with strategic coordination of regional development in the wealthiest member states, whereas the actual European funding for cohesion policy should be reduced and allocated differently in the future.
An ideal income system based on member state wealth would probably be sustainable, transparent and legitimate, but as long as the EU budget is unreformed, it would lead to disproportionate net contributions. Fair burden-sharing between member states can only be achieved if a new income system is accompanied by spending reforms, Malmström concluded.
Malmström’s speech and presentations by Iain Begg, André Sapir and Göran Färm as well as a recording of the Sieps seminar can be found on the think-tank’s web pages.
Zero-based budgeting
Sieps has initiated a debate on the European Union’s budget review 2008/9 by publishing a discussion paper ”Agenda 2014: A Zero-Base Approach” by Daniel Tarschys.
According to Tarschys zero-based budgeting has been a heavy instrument in annual budget processes, but might suit the multiannual financial framework of the EU.
Research is needed well ahead of the closing stages, when quarrels on burden sharing between member states exclude all other considerations. The European Union has a multitude of aims, but the real high-level priorities of the Union should be sifted out. The efficiency and effectiveness of Union programmes should be analysed, not only historically, but with a view to the future. The starting positions and expectations of member states should be examined. Programmes with diminishing returns still have their beneficiaries and defenders; phasing-out mechanisms and compensation packages should be planned.
The Swedish Institute for European Policy Studies is showing its pro-active stance in putting the crucial questions for the future of the European on its agenda and by its efforts to build coalitions for a reform agenda. The next long term budget (financial perspective) for five or seven years from 2014 is certainly one of these crucial areas of the Union.
To get started
Here, in addition to my previous posts, are a few sources for those who want to know more about EU (budget) reform:
The present long term budget (from 2007 including 2013) of the European Union is a good starting point: ”New budget, old dilemmas” by Iain Begg and Friedrich Heinemann.
If you want to reflect on a better budget for the EU, there is no turning back from the Common Agricultural Pollicy (CAP), still the biggest area of outlay in 2007. ”Why Europe deserves a better farm policy” by Jack Thurston presents the fundamental problems.
Iain Begg sorts out the basic budget terms and looks at both the budget review of 2008/9 and the financial perspective starting in 2014 in ”The 2008/9 EU budget review”. Is it possible to find solutions better adapted to the common good?
Ralf Grahn
Sources:
Swedish Institute for European Policy Studies: The Purse of the European Union: Setting Priorities for the Future; 26 October 2007; presentations by Cecilia Malmström, Iain Begg, André Sapir and Göran Färm; web-tv recording; http://www.sieps.se
Daniel Tarschys: Agenda 2014: A Zero-Base Approach; Swedish Institute for European Policy Studies; October 2007; http://www.sieps.se
Iain Begg & Friedrich Heinemann: New budget, old dilemmas; Centre for European Reform; 22 February 2006; http://www.cer.org.uk
Jack Thurston: Why Europe deserves a better farm policy; Centre for European Reform; December 2005; http://www.cer.org.uk
Iain Begg: The 2008/9 EU budget review; EU-Consent EU-budget Working Paper No. 3; March 2007; http://www.eu-consent.net
At the Sieps conference Sweden’s EU minister Cecilia Malmström recollected that the current financial perspective of the European Union was a step in the right direction, but it was not far-reaching enough. She stressed the importance of the built-in review mechanism.
According to Malmström, citizens rightly expect the EU to use common funds well and efficiently. The Reform Treaty will lead to major improvements in this respect. The second major tool is a modern budget. The Swedish government believes that substantial reforms of EU spending – including re-prioritisation between areas of expenditure – are needed in order to achieve a budget that can contribute to the EU meeting the challenges of the 21st century.
Subsidiarity, European added value, proportionality and sound financial management are fundamental principles for a reform. The Swedish government has drawn some preliminary conclusions on the direction of the future EU policies: competitiveness, justice and home affairs, migration and asylum as well as external action.
The future Common Agricultural Policy (CAP) should be guided by market orientation, consumer demand, environmental concern, deregulation and reduction of budget expenditure.
The European Union could contribute with strategic coordination of regional development in the wealthiest member states, whereas the actual European funding for cohesion policy should be reduced and allocated differently in the future.
An ideal income system based on member state wealth would probably be sustainable, transparent and legitimate, but as long as the EU budget is unreformed, it would lead to disproportionate net contributions. Fair burden-sharing between member states can only be achieved if a new income system is accompanied by spending reforms, Malmström concluded.
Malmström’s speech and presentations by Iain Begg, André Sapir and Göran Färm as well as a recording of the Sieps seminar can be found on the think-tank’s web pages.
Zero-based budgeting
Sieps has initiated a debate on the European Union’s budget review 2008/9 by publishing a discussion paper ”Agenda 2014: A Zero-Base Approach” by Daniel Tarschys.
According to Tarschys zero-based budgeting has been a heavy instrument in annual budget processes, but might suit the multiannual financial framework of the EU.
Research is needed well ahead of the closing stages, when quarrels on burden sharing between member states exclude all other considerations. The European Union has a multitude of aims, but the real high-level priorities of the Union should be sifted out. The efficiency and effectiveness of Union programmes should be analysed, not only historically, but with a view to the future. The starting positions and expectations of member states should be examined. Programmes with diminishing returns still have their beneficiaries and defenders; phasing-out mechanisms and compensation packages should be planned.
The Swedish Institute for European Policy Studies is showing its pro-active stance in putting the crucial questions for the future of the European on its agenda and by its efforts to build coalitions for a reform agenda. The next long term budget (financial perspective) for five or seven years from 2014 is certainly one of these crucial areas of the Union.
To get started
Here, in addition to my previous posts, are a few sources for those who want to know more about EU (budget) reform:
The present long term budget (from 2007 including 2013) of the European Union is a good starting point: ”New budget, old dilemmas” by Iain Begg and Friedrich Heinemann.
If you want to reflect on a better budget for the EU, there is no turning back from the Common Agricultural Pollicy (CAP), still the biggest area of outlay in 2007. ”Why Europe deserves a better farm policy” by Jack Thurston presents the fundamental problems.
Iain Begg sorts out the basic budget terms and looks at both the budget review of 2008/9 and the financial perspective starting in 2014 in ”The 2008/9 EU budget review”. Is it possible to find solutions better adapted to the common good?
Ralf Grahn
Sources:
Swedish Institute for European Policy Studies: The Purse of the European Union: Setting Priorities for the Future; 26 October 2007; presentations by Cecilia Malmström, Iain Begg, André Sapir and Göran Färm; web-tv recording; http://www.sieps.se
Daniel Tarschys: Agenda 2014: A Zero-Base Approach; Swedish Institute for European Policy Studies; October 2007; http://www.sieps.se
Iain Begg & Friedrich Heinemann: New budget, old dilemmas; Centre for European Reform; 22 February 2006; http://www.cer.org.uk
Jack Thurston: Why Europe deserves a better farm policy; Centre for European Reform; December 2005; http://www.cer.org.uk
Iain Begg: The 2008/9 EU budget review; EU-Consent EU-budget Working Paper No. 3; March 2007; http://www.eu-consent.net
Thursday, 25 October 2007
EU multiannual financial framework
The finances of the European Union are mostly presented according to the relevant treaty provisions on budgetary procedure or give an overview of spending categories. However, the importance of present and future parliamentary features concerning annual budgets is relative, since both resources and expenditure are firmly lodged with the member state governments. The key to this is the multiannual financial framework, a compelling budget for the mid term.
The governments of the member states are driven by their divergent national interests and have to reach a unanimous decision (liberum veto). The substantial result is less than satisfactory for the citizens of the Union. Reaching an outcome more satisfying to the common interest would require a reform of the decision making for the financial framework.
The next financial framework should be in place at the beginning of 2014, so the Reform Treaty should have entered into force by then. The new treaty includes a new chapter “The multiannual finanancial framework” (Article 270a).
Until now, these multiannual budgets have grown in practice (inter-institutional agreements), without treaty basis, but now this practice would be codified. Since the annual budgets shall comply with the multiannual framework, this is the decisive financial document of the European Union (as it is today).
Member state governments retain decision making and veto power:
The Council, acting in accordance with a special legislative procedure, shall adopt a regulation laying down the multiannual financial framework for a period of at least five years. (Five years would coincide with the mandates of the Commission and the European Parliament. The present financial framework encompasses seven years.) The Council shall act unanimously after obtaining the consent of the European Parliament, which shall be given by a majority of its component members (Article 270a, paragraph 1 and 2).
What if the European Parliament wanted to force the member state governments (the Council) to reform the budgets for the coming years by rejecting their financial framework?
Where no Council regulation determining a new financial framework has been adopted by the end of the previous financial framework, the ceilings and other provisions corresponding to the last year of that framework shall be extended until such time as that act is adopted (Article 270a, paragraph 4).
In other words, if the European Parliament does not take what it is offered, the following budgets are going to be built on priorities and expenditure levels fixed five or seven years earlier. This rule opens up possibilities for a member state government bent on sabotage, too. Thus, if no new financial framework is in place at the beginning of 2014, the budget then (and later) would reflect the political and negotiating positions of 2005 and 2006.
The “Lisbon Treaty” opens the door to an improved decision making process, although it is hard to believe that the governments would actually be mature enough to make use of this provision:
The European Council may, unanimously, adopt a decision authorising the Council to act by a qualified majority when adopting the regulation laying down the financial framework (Article 270a, paragraph 2).
The member states would still be in charge, but the chances for a somewhat more rational outcome would increase.
How many citizens of the European Union actually believe that 27 governments, unanimously, are going to be mature enough to let go of their veto power before 2014?
Ralf Grahn
The governments of the member states are driven by their divergent national interests and have to reach a unanimous decision (liberum veto). The substantial result is less than satisfactory for the citizens of the Union. Reaching an outcome more satisfying to the common interest would require a reform of the decision making for the financial framework.
The next financial framework should be in place at the beginning of 2014, so the Reform Treaty should have entered into force by then. The new treaty includes a new chapter “The multiannual finanancial framework” (Article 270a).
Until now, these multiannual budgets have grown in practice (inter-institutional agreements), without treaty basis, but now this practice would be codified. Since the annual budgets shall comply with the multiannual framework, this is the decisive financial document of the European Union (as it is today).
Member state governments retain decision making and veto power:
The Council, acting in accordance with a special legislative procedure, shall adopt a regulation laying down the multiannual financial framework for a period of at least five years. (Five years would coincide with the mandates of the Commission and the European Parliament. The present financial framework encompasses seven years.) The Council shall act unanimously after obtaining the consent of the European Parliament, which shall be given by a majority of its component members (Article 270a, paragraph 1 and 2).
What if the European Parliament wanted to force the member state governments (the Council) to reform the budgets for the coming years by rejecting their financial framework?
Where no Council regulation determining a new financial framework has been adopted by the end of the previous financial framework, the ceilings and other provisions corresponding to the last year of that framework shall be extended until such time as that act is adopted (Article 270a, paragraph 4).
In other words, if the European Parliament does not take what it is offered, the following budgets are going to be built on priorities and expenditure levels fixed five or seven years earlier. This rule opens up possibilities for a member state government bent on sabotage, too. Thus, if no new financial framework is in place at the beginning of 2014, the budget then (and later) would reflect the political and negotiating positions of 2005 and 2006.
The “Lisbon Treaty” opens the door to an improved decision making process, although it is hard to believe that the governments would actually be mature enough to make use of this provision:
The European Council may, unanimously, adopt a decision authorising the Council to act by a qualified majority when adopting the regulation laying down the financial framework (Article 270a, paragraph 2).
The member states would still be in charge, but the chances for a somewhat more rational outcome would increase.
How many citizens of the European Union actually believe that 27 governments, unanimously, are going to be mature enough to let go of their veto power before 2014?
Ralf Grahn
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