HC Deb 12 March 1998 vol 308 cc319-20W
Ms Lawrence

To ask the Chancellor of the Exchequer if he will make a statement on the Council Meeting of the Economic and Finance Ministers of the European Union held on 9 March. [34326]

Mr. Gordon Brown

I chaired the Economic and Finance Council—ECOFIN—of the European Union in Brussels on 9 March. The Economic Secretary represented the UK.

The Council began by discussing its recommendation to the Parliament that they discharge the Budget for 1996. Prof. Friedmann, President of the European Court of Auditors (ECA), gave a full presentation of the key findings from his report on the implementation of the 1996 Budget. Both Commissioner Liikanen and other colleagues responded. Although I was able to congratulate Prof. Friedmann on an excellent and thorough report, and Commissioner Liikanen on the significant steps forward in financial management, I also noted the Council's disappointment that the ECA was again unable to provide us with a positive Statement of Assurance on the implementation of the Budget.

I also drew colleagues' attention to my intention to use the 19 May ECOFIN for a wide-ranging discussion of Community financing issues, including follow-up to the criticisms made in the ECA report, the next Preliminary Draft Budget (for 1999), and the future financing of the Community (on the basis of the Commission's Agenda 2000 proposals).

The Council next considered the follow-up to the code of conduct for business taxation agreed at the 1 December ECOFIN. We agreed the setting up of the assessment group provided for in the code. Commissioner Monti presented his draft directive regarding the taxation of interest and royalty payments between associated companies in different states.

The Council considered a memorandum on a coordinated European response to the challenges posed by the development of electronic commerce. After some contributions from Commissioner Monti and other colleagues, I noted that this was a matter of some interest to ECOFIN, and that we should return to it.

Under the preparation of Stage 3 of EMU, the Council received information from the Presidency, Commission, and Council Secretariat on the timetable for the EMU decision-making process. I also took the opportunity to remind colleagues of the importance of ensuring that national legislation, including the statutes of national central banks, is made compatible with the Treaty requirements for EMU.

On the basis of a presentation from Commissioner de Silguy, and a response from Sir Brian Unwin (President of the European Investment Bank), the Council discussed the principle of the Community guaranteeing EIB lending to Bosnia-Herzegovina. After some discussion, I concluded that there was a broad consensus that the Commission should bring forward a proposal, and noted particularly that some Member States had asked the Commission to keep budget discipline in mind when doing so.