Mr. SummcrsonTo ask the Chancellor of the Exchequer if he will make a statement on the outcome of the recent meeting of the European Community's Budget Council.
MECU Expenditure ceilings Draft budget ecu £ ecu £ Commitment appropriations FEOGA guarantee 28,624 19,886 28,127 19,541 Structural funds 9,522 6,615 9,478 6,585 R & D and integrated Mediterranean programmes 1,708 1,187 1,583 1,100 Other policies 2,468 1,715 2,298 1,596 Reimbursements and administration 5,153 3,580 5,081 3,530 Monetary reserve 1,000 695 1,000 695 TOTAL 48,475 33,677 47,567 33,046 Total payment appropriations1 46,885 32,572 46,009 31,964 1 There is only a global ceiling for payments. Provision for agricultural guarantee expenditure is almost 500 mecu (£350 million) below the limit agreed at the Brussels Council and given legal effect in the Budget discipline decision. The draft budget also includes provision of 1.45 becu (£1 billion) for the cost of depreciating existing agricultural stocks; and of 1 becu (£695 million) for a monetary reserve which can be drawn upon only to cover unforeseen additional expenditure of over 400 mecu (£280 million) arising from changes in the $/ecu exchange rate.
Non-obligatory expenditure (DNO) in the draft budget totals 13.5 becu (£9.4 billion) in commitments and 12 becu (£8.3 billion) in payments. In accordance with the conclusions of the Brussels European Council, the Budget Council distinguished between so-called "privileged" and "non-privileged" expenditure. In the first category, the draft budget provides for the substantial increase in appropriations for the structural funds agreed at the Brussels Council and for research and development appropriations at a level consistent with the framework programme adopted in September 1987. As regards non-privileged DNO, the Budget Council reduced the proposed provision in the PDB by an amount sufficient to ensure that, for this category of expenditure, the growth of both payments and commitments was contained within half the maximum rate of 5.8 per cent, communicated by the Commission. The growth of DNO as a whole in the draft budget is some 16.6 per cent, in commitments and some 17.7 per cent, in payments. The fact that the Council substantially exceeded the overall maximum rate was an inevitable consequence of the increase in provision for the structural funds.
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§ Mr. BrookeThe Budget Council met in Brussels on 26 July. I represented the United Kingdom.
The Council established a first reading draft budget for 1989 totalling 47.6 becu (£33.1 billion) in commitment appropriations and 46.0 becu (£32.0 billion) in payment appropriations, respectively 470 mecu (£325 million) and 480 mecu (£335 million) below the figures proposed by the Commission in the preliminary draft budget (PDB).
The 1989 budget is the first to be subject to the new arrangements for budgetary discipline arising from the Brussels European Council of 11–12 February and to the inter-institutional agreement (IIA) between the Council, the Commission and the European Parliament which incorporates expenditure ceilings for 1988–92. The following table shows that the first reading draft budget is some way within those ceilings.
The draft budget implies an own resource call up rate of 1.15 per cent, of Community GNP compared with own resources sub-ceiling for 1989 of 11.7 per cent.
The European Parliament will consider the draft budget at its plenary session in October and is entitled to make amendments and modifications within the ceilings for individual categories of expenditure set out in the II A. The Budget Council will consider these amendments and modifications at its second reading of the budget in November.