HC Deb 20 October 1992 vol 212 cc243-5W
Mr. Burns

To ask the Chancellor of the Exchequer if he will make a statement on the outcome of the meeting of European Ministers at the Budget Council in July.

Sir John Cope

The Budget Council met in Brussels on 23 July. As President of the Budget Council I chaired the meeting, and the Economic Secretary represented the United Kingdom. The Council established a first reading draft budget for 1993 totalling 65.7 billion ecu—£51.7 billion—in commitment appropriations and 62.9 billion ecu—£49.5 billion—in payment appropriations. The latter represents 1.07 per cent. of Community GNP, compared with the own resources ceiling of 1.2 per cent.

The draft budget established by the Council constrained the increase in non-compulsory expenditure to 3.79 per cent. for commitments and to 7.2 per cent.—the "maximum rate"—for payments. This involved reductions of 3,570 million ecu—£2,811 million—in commitments and 3,383 million ecu—£2,664 million—in payments of the proposals put forward by the Commission in its preliminary draft budget. The provision for agriculture takes full account of CAP reform; and is 2.6 billion ecu—£2.05 billion—below the agriculture guideline. Financial provision was not made for the cohesion fund agreed at Maastricht, which the Lisbon European Council agreed should be set up early in 1993, pending a decision on the amount which is expected to be taken at the European Council in Edinburgh.

An explanatory memorandum on the Council's draft budget was submitted to the House on 9 October.

The summary table compares the outcome of the Budget Council to the proposals in the Commission's preliminary draft budget by reference to the main areas of spending:

programme. The supplementary budget also makes provision to return to a member state a significant proportion of the expected surplus in the agriculture budget. In the proposed supplementary budget the agricultural budget is reduced by 2,875 million ecu—£2,059 million—with 2,175 million ecu—£1,558 million—of that money being returned to member states through a reduction in contributions; the remainder is utilised for other Community policies.

The European Parliament will consider the draft budget for 1993 at its plenary in late October—the 26th to 30th. The Parliament's amendments and modifications will be considered at the second Budget Council on 17 November. The European Parliament's second reading is set for mid-December.