§ Sir Teddy TaylorTo ask the Chancellor of the Exchequer what estimates have been made of the additional cash contributions from the EC which will accrue to each member state in consequence of the decisions taken at the Edinburgh meeting of the European Council; and if he will make a statement.
§ Sir John Cope[holding answer 18 January 1993]: The Edinburgh European Council agreed the following allocation of expenditure from the European Community budget:
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(billion ecu—1992 prices) 1992 1999 increase (a) Commitment ceilings Agriculture (guideline) 35.30 38.40 3.00 Cohesion Fund — 2.60 2.60 Structural Funds—Objective 1 11.00 19.30 8.30 Other Structural operations 7.50 8.10 0.60 Other internal policies 3.90 5.10 1.20 External policies 3.90 5.60 1.70 Administrative expenditure 3.20 3.90 0.70 Repayments 0.90 — -0.90
(billion ecu—1992 prices) 1992 1999 increase Monetary reserve 1.00 0.50 -0.50 Reserves for external policies — 0.60 0.60 Total expenditure commitments 66.90 84.10 17.20 (b) Own resources ceiling as percentage of GNP 1.20 1.27 becu12 64.90 80.60 15.70 1 The own resources ceiling expressed in ecu is calculated using the Commission's growth assumptions which were available to the European Council. 2 The expenditure commitment ceilings sum to more than the own resources ceiling. Although the Edinburgh European Council conclusions limit the own resources ceiling (and hence payments from the Community budget) to 1.27 per cent. of community GNP in 1999, commitments were constrained to 1.335 per cent. of GNP. This is possible because first, some commitments will in practice not be taken up and so will not result in payments being made; and second, there is in some cases, a considerable time-lag between commitments and payments. As long as the European economy continues to grow in nominal terms, such expenditure commitments will represent a smaller proportion of Community GNP when the payments are made than when the commitments were given. As the existing financial perspective ended with 1992, it is not possible to say what would have happened to Community expenditure over the next seven years if no agreement had been reached at Edinburgh.
However, until there was agreement the revenue available to the Community would have continued to be subject to the 1988 own resources decision, with the own resources ceiling limited to 1.20 per cent. of GNP. The revenue which the Community could call up could therefore have grown in line with growth in the Community economy. On the basis of the growth assumptions available to the Edinburgh European Council, the revenue from a 1.20 per cent. own resources ceiling would allow payments of up to 76.1 billion ecu in 1999. In effect, therefore, the decision of the European Council to increase the own resources ceiling from 1.20 per cent. to 1.27 per cent. of GNP increased the permissible level of payments from the Community budget by 4.5 billion ecu a year by 1999.
It is not possible to estimate with any certainty how each member state would benefit from this additional 4.5 billion ecu by comparison with decisions which might have been made in the absence of agreement in Edinburgh.