AUTHORS from the POLICY DEPARTMENT B members: Jonathan LITTLE, Albert MASSOT, Guillaume RAGONNAUD, Francesco TROPEA
Wednesday 27 February 2013, by Carlos San Juan
PROVISIONAL NOTE VERSION 1
Work in Progress
The Treaty of Lisbon consolidated the ’Multiannual Financial Framework’ as well as developing its legislative rules inside the TFEU. The ’MFF package 2014/2020’ to be negotiated by the EU legislative bodies (European Parliament and Council) includes three texts on the: 1) MFF Regulation; 2) Decision on the system of EU own resources; and 3) Interinstitutional Agreement (IIA) on cooperation in budgetary matters and on sound financial management.
The European Council Agreement of 7–8 February 2013 could be considered merely a political compromise among the EU Heads of State and governments. It constitutes a negotiating mandate for the Council in order to take forward discussions with the European Parliament on the ’MFF package’.
The timings of the MFF negotiation and the CAP reform process will overlap and become mutually interdependent.
In contrast with the European Parliament’s approach, the Council does not clearly differentiate between financial negotiations and the CAP reform process. The ’Financial Negotiating Box’ created by the Council is taken up again by the European Council. If Council finally includes agricultural provisions inside the ’MFF regulation’ proposal, the codecision process could be undermined.
If there is no financial agreement before the end of 2013, the 2013 ceilings would remain in 2014, plus a 2% inflation adjustment.
The European Council Conclusions compared to the EP Resolutions show important divergences between Council and the European Parliament on the future MFF.
To overcome this political impasse, substantive efforts from the negotiators will be needed before summer 2013.
The 7–8 February 2013 European Council set total allocations for the MFF 2014– 2020 for 28 Member States at a lower level than for the previous MFF for 27 Member States (around EUR 34 billion less, i.e. -3.5% for both commitment and payment appropriations).
This is the first time in the EU’s history that an MFF is set at a lower level than its predecessor.
In terms of relative shares in the MFF, Headings 1 and 2 have followed diverging trends between 2007 and 2020: while the first has increased by nearly 6 percentage points, the second has seen its share reduced by more than 8 percentage points.
EUR 373.2 billion is allocated to Heading 2, which includes the Common Agricultural Policy, Common Fisheries Policy and LIFE+ for the period 2014– 2020, compared to EUR 421.1 billion in the period 2007–2013.
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