MEPs step up demand for funding of key priorities

Date: 14/11/1996

By Rory Watson and Michael Mann

UNION governments and the European Parliament will try to settle their differences next week over spending on priority projects in the 1997 EU budget.

Both agree on the need to keep tight controls on Union expenditure in the run-up to a single currency, but MEPs are firmly resisting plans to cut funds for a series of internal policies they regard as key EU priorities.

Budget ministers will discuss the differing demands with senior MEPs when they meet on Tuesday (19 November), but are certain to oppose the Parliament's strategy of freezing finance in special reserve funds now so as to make cash available later next year for individually selected programmes.

“The Council of Ministers does not share the Parliament's priorities and does not think that its tactic of using a special reserve fund is part of the agreement between the two institutions,” explained a senior EU diplomat.

Governments can overturn the MEPs' decision to add 274 million ecu to spending on single market, energy, information and education policies by majority vote next week. But it will almost certainly be reinstated when the Parliament finally adopts the 1997 budget in mid-December.

The Parliament points out that, for the first time in recent history, the initial spending plans it adopted last month are lower than those advanced in April by the European Commission.

While the Commission had proposed overall spending levels of 90 billion ecu for 1997, these were later cut by EU governments to 88.4 billion ecu, before MEPs split the difference and raised them to 89.2 billion ecu.

Next week's meeting of budget ministers coincides with proposals from the Commission for major cuts in subsidies to a wide range of farm products.

The move to trim expenditure is considered necessary to meet the costs of the beef crisis, pay for reforms of the fruit and vegetable markets and respect a ministerial decision taken in July to reduce agricultural spending by 1 billion ecu.

Under the Commission's proposals, farm expenditure in 1997 would be pegged at 40.805 billion ecu. The plan would mean a 22&percent; increase in beef spending to 7.451 billion ecu.

The extra money would be spent on export refunds (153 million ecu), intervention purchases (452 million ecu), intervention directed towards young animals (387 million ecu), a new 'early marketing premium' (393 million ecu) and additional support measures (442 million ecu). Spending on fruit and vegetables and olive oil would also rise, funded by cutbacks in other farm sectors.