Governments reject Balkans funding plan

Date: 15/06/2000

By Simon Taylor

EU GOVERNMENTS have rejected the European Commission's plan to set aside €1.8 billion of funding for Serbia if and when the country opens up to the west.

They are also opposing plans to shave €300 million off next year's EU farm budget to pay for aid to the Balkans, a move which could force cuts to be made in other foreign policy areas to finance the shortfall.

Their stance has set them on a collision course with the Commission and MEPs. External Relations Commissioner Chris Patten argues that setting money aside for Serbia is a key element of his strategy for bringing the Balkans closer to the Union. The European Parliament has also threatened to force through a massive increase in the overall budget unless the member states agree to provide extra money to cover the costs of Balkan aid programmes.

Governments' opposition to the funding proposals emerged at a meeting of national finance ministry officials held to discuss the planned €5.5-billion draft budget for the region for the next seven years.

They argued that setting aside money to be handed over to Serbia if and when President Slobodan Milosevic is ousted from power would break normal rules which require money to be allocated to actual projects. "This is simply not how we do the budget," said one official.

They also insisted that neither the Council of Ministers nor the Parliament would "allow money to be taken from the agriculture budget".

As EU governments remain adamant that they will not provide any extra money to cover the additional costs of reconstruction projects in the Balkans, officials predict that their stance will spark a major debate about cutting funding for other foreign policy programmes.

But the Parliament has warned that it will force through a €2-billion increase in the 2001 budget if finance ministers try to do this. MEPs' resolve to secure additional funding has been strengthened by a recent visit to Kosovo by a parliamentary delegation which found that there was a greater need for extra money than originally thought.

Jean-Paul Mingasson, head of the Commission's budget directorate-general, has urged MEPs not to push through a spending increase, arguing that that this would be "a step backwards dictated by short-sightedness".

Patten, Development Commissioner Poul Nielson and Budget Commissioner Michaele Schreyer will hold talks with MEPs next Thursday (22 June) to try to resolve the differences between the Commission and Parliament over the Balkans funding question.

Members of the assembly's budget committee will also hold a meeting with national finance ministry officials next month in an attempt to broker a deal on the 2001 budget ahead of the first formal meeting of junior finance ministers to discuss the proposals on 20 July.

EU governments have rejected the European Commission's plan to set aside €1.8 billion of funding for Serbia if and when the country opens up to the west. They are also opposing plans to shave €300 million off the 2001 EU farm budget to pay for aid to the Balkans, a move which could force cuts to be made in other foreign policy areas to finance the shortfall.