§ Lord Brougham and Vauxasked Her Majesty's Government:
Whether they will make a statement on the outcome of the recent meeting of the European Communities Budget Council.
The Paymaster General (The Earl of Caithness)The Budget Council met in Brussels on 28th July. I represented the United Kingdom.
The Council established a first reading draft budget for 1990 totalling 48.19 becu (£30.7 billion) in commitment appropriations and 46.14 becu (29.4 billion) in payment appropriations, respectively 708.3 mecu (£451.4 million) and 653.3 mecu (£416.4 million) below the figures proposed by the Commission in the preliminary draft budget (PDB).
The 1990 budget is the second to be subject to the arrangements for budgetary discipline arising from the 1988 European Council and 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:
1015WA
Financial Perspective Draft Budget mecu £m mecu £m Commitment appropriation 1. FEOGA guarantee 30,700 19,567 26,522 16,904 2. Structural Funds 11,555 7,365 11,527 7,347 3. R&D and Integrated Mediterranean programmes 2,071 1,320 1,957 1,248 4. Other policies 2,729 1,739 2.500 1,593 5. Reimbursements and administration 4,930 3,142 4,688 2,988 6. Monetary reserve 1,000 637 1,000 637 Total 52,985 33,770 48,194 30,717 Total payment appropriations* 50,791 32,372 46,139 29,407 *There is only a global ceiling for payments. Provision for agricultural guarantee expenditure is about 4,000 mecu (£2,549 million) below the financial guideline calculated in accordance with the Budget Discipline Decision of June 1988. The draft budget also includes provision of 1470 mecu (£940 million) for the cost of depreciating existing agricultural stocks; and of 1000 mecu (£637 million) for a monetary reserve which can be drawn up only to cover part of any additional agricultural expenditure arising from change in the $/ecu exchange rate.
Non-obligatory expenditure (DNO) in the draft budget totals 16.3 becu (£10.4 billion) in commitments and 14.2 becu (£9.1 billion) in payments. In accordance with the conclusions of the 1988 February 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 February 1988 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 6.1 per cent. communicated by the Commission.
On 9th October, the ECOFIN Council established an amending letter to the PDB providing for economic restructuring aid to Poland and Hungary totalling 200 mecu. This expenditure is in excess of the relevant ceiling in the financial perspective (line 4 in the above table) and, as a temporary device pending the necessary revision of the perspective, the Council agreed to a corresponding negative reserve.
The European Parliament will consider the draft budget at its plenary session in the week beginning 24th October. The Parliament's amendments and modifications will be considered by the Budget Council on 14th November.