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COUNCIL OF

THE EUROPEAN UNION

11630/07 (Presse 166)

PROVISIONAL VERSION

PRESS RELEASE

2814th Council meeting

Economic and Financial Affairs

BUDGET

Brussels, 13 July 2007

President

Mr Emanuel Augusto SANTOS

Deputy Minister of Finances for the Budget of Portugal

PRESS

Rue de la Loi 175

B – 1048 BRUSSELS

Tel.: +32 (0)2 281 5389 / 6319

Fax: +32 (0)2 281 8026

[email protected] http://www.consilium.europa.eu/Newsroom

11630/07 (Presse 166)

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PROVISIONAL VERSION

13.VII.2007

Main results of the Council

The Council agreed on the draft budget for 2008 at first reading after a conciliation meeting with

the European Parliament and the Commission.

The Commission submitted its preliminary draft budget in spring 2007.

As usual, the draft budget will be examined and amended by the European Parliament at first

reading in autumn 2007.

The Commission will submit a number of letters of Amendment in autumn before the second reading

by the Council scheduled for November 2007.

11630/07 (Presse 166)

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PROVISIONAL VERSION

13.VII.2007

CONTENTS

PARTICIPANTS................................................................................................................................ 4

ITEMS DEBATED

OUTCOME OF THE CONCILIATION MEETING WITH THE EUROPEAN

PARLIAMENT.................................................................................................................................... 6

ESTABLISHMENT OF THE DRAFT BUDGET OF THE EUROPEAN COMMUNITIES

FOR THE FINANCIAL YEAR 2008................................................................................................ 12

OTHER ITEMS APPROVED

BUDGET 2007

–

Draft amending to the General Budget for 2007 ................................................................................................... 14

EXTERNAL RELATIONS

–

EU/Lebanon Euro-Mediterranean Agreement - Enlargement ............................................................................... 14

Where declarations, conclusions or resolutions have been formally adopted by the Council, this is indicated

in the heading for the item concerned and the text is placed between quotation marks.

Documents for which references are given in the text are available on the Council's Internet site

(http://www.consilium.europa.eu).

Acts adopted with statements for the Council minutes which may be released to the public are indicated by

an asterisk; these statements are available on the Council's Internet site or may be obtained from the Press

Office.

11630/07 (Presse 166)

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PROVISIONAL VERSION

13.VII.2007

PARTICIPANTS

The Governments of the Member States and the European Commission were represented as

follows:

Belgium:

Mr Jan DE BOCK

Bulgaria:

Mr Lyubomir DATZOV

Czech Republic:

Mr Eduard JANOTA

Denmark:

Mr Claus GRUBE

Germany:

Mr Thomas MIROW

Estonia:

Mr Väino REINART

Ireland:

Mr Noel AHERN

Permanent Representative

Deputy Minister for Finance

Deputy Minister for Finance, Public Budgets Section

Permanent Representative

State Secretary, Federal Ministry of Finance

Permanent Representative

Minister of State at the Department of the Environment,

Heritage and Local Government (with special

responsibility for Housing and Urban Renewal) and at the

Department of Community, Rural and Gaeltacht Affairs

(with special responsibility for Drugs Strategy and

Community Affairs

Deputy Permanent Representative

Permanent Representative

State Secretary for Economic Affairs and Finance

Director General

State Secretary, Ministry of Finance

Undersecretary, Ministry of Finance

Permanent Representative

State Secretary, Ministry of Finance

Permanent Representative

State Secretary, Federal Ministry of Finance

Undersecretary of State, Ministry of Finance

Greece:

Mr Dimitris N. ILIOPOULOS

Spain:

Mr Carlos BASTARRECHE SAGÜES

France:

Mr Pierre SELLAL

Italy:

Mr Paolo CENTO

Cyprus:

Mr Stavros MICHAEL

Latvia:

Ms Irēna KRÜMANE

Lithuania:

Mr Edmundas ZILEVIČIUS

Luxembourg:

Mme Martine SCHOMMER

Hungary:

Mr Miklós TÁTRAI

Malta:

Mr Richard CACHIA CARUANA

Netherlands:

Mr Tom de BRUIJN

Austria:

Mr Christoph MATZNETTER

Poland:

Ms Marta GAJĘCKA

11630/07 (Presse 166)

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PROVISIONAL VERSION

Portugal:

Mr Emanuel AUGUSTO SANTOS

Mr Pedro RODRIGUES

Romania:

Mr Lazar COMANESCU

Slovenia:

Ms Alenka JERKIC

Slovakia:

Mr František PALKO

Finland:

Ms Mari KIVINIEMI

Sweden:

Mr Hans LINDBLAD

United Kingdom:

Ms Kitty USSHER

13.VII.2007

State Secretary for the Budget, attached to the Minister for

Finance

Deputy State Secretary, Ministry of Finance

Permanent Representative

Counsellor

State Secretary at the Ministry of Finance

Minister for Public Administration and Local Government

State Secretary at the Ministry of Finance

Economic Secretary to the Treasury

Commission:

Ms Dalia GRYBAUSKAITÉ

Member

11630/07 (Presse 166)

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ITEMS DEBATED

OUTCOME OF THE CONCILIATION MEETING WITH THE EUROPEAN

PARLIAMENT

13.VII.2007

Before examining and establishing the draft budget for the financial year 2008, the Council held its

customary meeting with a delegation from the European Parliament in the framework of the

Interinstitutional Agreement. The delegation was led by Mr Reimer BÖGE, Chairman of the

Committee on Budgets, and comprised:

Mr Kyösti VIRRANKOSKI (Rapporteur for Section III - Commission - of the 2008

budget),

Mr Ville ITÄLÄ (Rapporteur for Other Sections of the 2008 budget),

Mr Valdis DOMBROVSKIS, Mr James ELLES, Mr Michel GAHLER,

Mr Salvador GARRIGA POLLEDO, Ms Catherine GUY-QUINT, Ms Jutta HAUG,

Ms Monica Maria IACOB-RIDZI, Mr Francesco MUSOTTO, Mr Bernhard RAPKAY,

Ms Dagmar ROTH-BEHRENDT, Mr Esko SEPPÄNEN, Mr László SURJÁN and

Ms Helga TRÜPEL, members of the European Parliament.

Ms Dalia GRYBAUSKAITÉ, member of the European Commission, took part in the

conciliation meeting.

The conciliation meeting, which was prepared on the basis of the outcome of the discussions in the

Trilogue on 6 July 2007 covered the general outline of the 2008 budget and the following specific

items related to the Budget 2008:

–

Kosovo and Palestine:

The European Parliament and the Council agreed to resume discussion of this question in

November in order to better clarify the additional financial needs which could be identified

consequently to the situation in those countries.

–

CFSP:

The European Parliament and the Council held an exchange of views on the subject and

agreed to come back to it in November in the light of developments.

11630/07 (Presse 166)

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–

Decentralised and executive agencies:

13.VII.2007

The European Parliament and the Council held an exchange of views on this subject and

adopted two joint statements (see below).

–

Joint Statements

The European Parliament and the Council confirmed the following joint statements on

Recruitment related to 2004 & 2007 enlargement, Decentralised &Executive agencies,

Structural and Cohesion Funds and Rural Development 2007-2013, Assigned Revenues

respectively, which will be entered in the Council’s minutes.

The Commission entered a unilateral statement in this context.

Structural and Cohesion Funds and Rural Development 2007-2013 programmes

"The European Parliament and the Council attach the greatest importance to a rapid

approval by the Commission of the operational programmes and projects presented by

Member States in relation with the new Structural and Cohesion Funds programmes for

the 2007-2013 period, as well as for programmes financed under Rural Development.

In order to avoid the past experience during the beginning of the 2000-2006 programming

period, the European Parliament and the Council will monitor rigorously and on a regular

basis the process of approval of operational programmes and projects in view of more

efficiency and good administration. To this end, the Commission is requested to continue

to provide regularly specific monitoring tools, including a flow chart, during the budgetary

procedure."

Recruitment in relation with the 2004 and 2007 enlargement

"The European Parliament and the Council note with concern the low occupancy of posts

at Middle Management level, the rather high ratio of permanent posts occupied by

temporary agents and the lack of a sufficient number of appropriate competitions.

The European Parliament and the Council insist that all efforts should be made by the

institutions and specifically by EPSO to ensure that the necessary action is taken to rectify

the situation and to speed up the whole process of filling up the posts granted by the

budgetary authority with officials. The criteria should be as stipulated in Article 27 of the

Staff Regulation and to arrive at the broadest possible geographical proportional basis as

soon as possible.

11630/07 (Presse 166)

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13.VII.2007

The European Parliament and the Council intend to continue to monitor closely the

ongoing recruitment process. To this effect, they request each institution and EPSO to

provide twice a year an information to the budgetary authority on the state of affairs

regarding recruitments in relation with the 2004 and 2007 enlargement.

The European Parliament and the Council invite the Secretaries-general of the institutions

to present a report on the progress made in the field as follows:

–

concerning the filling of the posts granted in 2004-2007 budgets by the end of

January 2008;

concerning the filling of the posts granted in 2008 by 15 June 2008 and by

31 October 2008."

–

Assigned revenues

"The European Parliament and the Council believe that increasing transparency in the

budgetary field is part of a sound financial management of the EU funds.

In this context, they ask the Commission and the other institutions to provide appropriate,

timely and detailed documentation on assigned revenues, covering actual implementation

and forecasts as far as possible, to accompany the Preliminary Draft Budget. The

Commission will provide appropriate information on assigned revenues in relation to

carry-overs and when available transfers of appropriations; this will entail changes to the

format and content of the current documentation and will not prejudge the decisions to be

taken by the budgetary authority.

They attach a great importance to the monitoring of the assigned revenues, especially to

those related to the Community agencies, and ask the Commission to report regularly on

their implementation, in particular on the basis of a specific document before the first

reading of the budget. They invite the Commission to present appropriate proposals

allowing an effective monitoring and control of the assigned revenues in the context of the

upcoming revision of the Framework Financial Regulation No. 2343/2002 for Community

agencies.

The Commission is invited to report about the improvements made no later than the

beginning of the following budgetary procedure. The European Parliament and the

Council will continue to closely pay attention to the management of the assigned revenues

expecting rapid improvements in this field."

11630/07 (Presse 166)

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Decentralised agencies

13.VII.2007

"Concerning the creation or the modification of the scope of a body falling under Article

185 of the Financial Regulation, the two arms of the budgetary authority ask the

Commission to inform them timely on the ongoing legislative procedure in order to enable

them to exert their prerogatives in accordance with Point 47 of the IIA.

The European Parliament, the Council and the Commission demand greater transparency

in relation to the decentralised agencies, with a view to better monitoring their

development. The Commission will identify for each heading the expenditure for agencies,

including its evolution over the 2007-2013 period.

They recall their joint statement on Community agencies adopted on 18 April 2007,

especially its point 4, and invite the Commission to provide a list of the agencies that it is

going to assess including a detailed timetable for this procedure and a detailed

explanation of the criteria used for the selection of the agencies and to present the results

each year at the October Trilogue at the latest.

To allow the budgetary authority to get a clear and comprehensive picture of evaluations

already made, the Commission should give the list of the agencies that have already been

evaluated and a short summary of the major findings of these analysis.

They also recall that in the abovementioned joint statement of 18 April 2007, the

Commission has been invited to provide, simultaneously with each PDB, a working

document covering all Community agencies.

To achieve this, decentralised agencies are requested to provide detailed information, on

an annual basis, to accompany their draft estimates for the coming budget year. This

should include an update of their staff policy plan, with information on the number of

permanent and temporary agents covered by the establishment plans and on external staff

(contractual agents) for the years n-1, n and n+1, the work programme of the agency and

information on the content of their budget, detailing titles 1 and 2.

They shall also make available estimates and indicators such as rents or estimated value of

buildings, statute of staff and any privileges granted to the agencies by the host Member

States.

11630/07 (Presse 166)

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13.VII.2007

Moreover, the agencies should provide, by the end of March each year n at the latest, an

estimate of the operating surplus from the year n-1, which is to be returned to the

Community budget later in year n, in order to complete the information already available

concerning the surplus of n-2.

The European Parliament and the Council invite the Commission to proceed to the

collection of all information mentioned above, in due time for each PDB, and to collect

missing information for this year."

Executive agencies

"The European Parliament and the Council welcome all efforts to improve the efficiency of

the methods used by the European Commission to implement EU policies and

programmes.

The creation of executive agencies can constitute a contribution to such efficiency, but only

if this method fully respects the principle of sound financial management and total

transparency. This means that such agencies must not, either now or in the future, lead to

an increase in the share of administrative cost. Therefore, the principle of freezing of posts

as defined in Council Regulation (EC) No. 58/2003 of 19 December 2002, as a result of

such a reorganisation of tasks, must be adhered to rigorously. Any proposal for the

creation of a new executive agency should be based on a comprehensive cost-benefit

analysis. Lines of accountability and responsibility should be clearly set out in the

proposal.

The budgetary authority must be in possession of all the requisite information enabling it

to monitor closely the implementation of this principle both currently and in the future. The

information in the specific financial statement for the executive agency should therefore

cover:

the resources in terms of appropriations and staff required to run the executive

agency, showing a breakdown of staff expenditure (permanent and temporary

officials and contractual agents) and other administrative expenditure;

the planned secondments of officials from the Commission to the executive agency;

11630/07 (Presse 166)

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13.VII.2007

administrative resources freed by transferring tasks from the Commission

departments to the executive agency, and the re-allocation of the human resources;

in particular the number of staff (including external staff) assigned to each relevant

task within the Commission, the number of this staff to be transferred to a proposed

new or enlarged agency, the number of Commission posts to be frozen as a

consequence and the number of Commission staff to be proposed to be redeployed

to other tasks;

consecutive redeployment within the Commission's establishment plan;

the advantages of delegating implementing tasks to an executive agency versus

direct management by the Commission services: any comparison of a "Direct

management by the Commission services"-scenario to an "executive agency"-

scenario shall be based on the resources used to implement the existing

programme(s) and its (their) current form in order to have a sound and factual

basis for comparison; for new and expanding programmes the evolution of the

related financial envelope to be managed by the agency will also be taken into

consideration;

a draft establishment plan per grade and per category as well as a well-founded

estimate of the number of contractual agents planned and provisionally budgeted;

a clear breakdown of all actors involved in the implementation programme

including the remaining share of the operational programme envelope for the

implementation of which they are responsible (Commission, executive agencies,

remaining Technical Assistance Offices, Member States, national agencies, etc.)

The European Parliament and the Council call on the Commission, before deciding to

create a new agency or to extend the remit of an existing agency, to supply complete and

detailed information on staffing levels and utilisation enabling the budgetary authority to

assess whether the administrative expenditure of implementing a programme has indeed

not been increased.

It is recalled that the final decision on staffing remains a matter for the budgetary

authority."

11630/07 (Presse 166)

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13.VII.2007

ESTABLISHMENT OF THE DRAFT BUDGET OF THE EUROPEAN COMMUNITIES

FOR THE FINANCIAL YEAR 2008

(see 11427/07 + COR1 + ADD1, 11428/07 + ADD1, ADD2)

After the conciliation meeting with the European Parliament, and on the basis of the preparatory

work done by the Permanent Representatives Committee, the Council confirmed by a large

qualified majority the agreement reached by the Permanent Representatives Committee on the draft

general budget for 2008 and statements

as recorded in

documents 11427/07 + COR1 + ADD1 and

11428/07 + ADD1 and ADD2.

The Council gives a mandate to the Presidency, assisted by the General Secretariat of the Council,

to establish budget documents and forward them to the European Parliament in accordance with the

planned timetable.

The 2008 draft budget at first reading amounts to:

EUR 128 401 211 009 in commitment appropriations

EUR 119 410 254 634 in payment appropriations.

Compared with 2007 Budget, these amounts represent a 1.44% increase in commitment

appropriations and a 3.39% increase in payment appropriations.

The main principles that guided the Council were the following :

–

an adequate financing of the various EU priorities;

a carefully controlled increase of payment appropriations;

a respect of the existing ceilings of the Financial Framework ensuring that, where

appropriate, sufficient margins are left below the ceilings of the different Headings and

sub-Headings.

In this context, a statement by Italy, joined by Spain and Greece, was made on

multilingualism".

11630/07 (Presse 166)

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PROVISIONAL VERSION

A summary of the outcome of proceedings is given in the table below:

13.VII.2007

(in EUR)

Council 1st reading

Difference from 2008 PDB

Commitments

Payments

Difference from 2007 budget

(%)

Commitments

Payments

Margin below

existing FF

Heading

Commitments

1. Sustainable growth

1a. Competitiveness for growth and

employment

1b. Cohesion for growth and

employment

Total

European Global Adjustment Fund

2. Preservation and management of

natural resources

of which Market related expenditure

and direct aids

3. Citizenship, freedom, security and

justice

3a. Freedom, security and justice

3b. Citizenship

Total

4. The EU as a global partner

Emergency Aid Reserve

Total

5. Administration

6. Compensations

GENERAL TOTAL

Payment appropriations, as a % of GNI

686 735 780

583 943 000

1 270 678 780

6 889 796 000

239 218 000

7 129 014 000

7 190 244 746

206 636 292

128 401 211 009

478 147 780

649 833 006

1 127 980 786

7 552 525 400

7 190 804 746

206 636 292

119 410 254 634

0.95

-96 173 008

-4 298 220

-14 550 000

-18 848 220

+217 600 000

-18 298 220

-44 550 000

-62 848 220

-125 000 000

-239 218 000

Payments

9 504 015 250

8 990 265 850

-266 413 750

-548 413 750

+7.18

+27.58

342 984 750

46 877 941 445

56 381 956 695

500 000 000

40 124 714 507

49 114 980 357

-498 000 000

+3.06

+3.73

+6.18

+9.54

11 058 555

354 043 305

-266 413 750 -1 046 413 750

55 722 680 496

54 217 327 053

-553 151 000

-0.94

-0.92

3 077 319 504

41 948 990 000

41 897 050 500

3 005 010 000

+10.08

-9.83

-0.06

+4.74

+2.00

+0.89

-10.74

-6.15

+2.72

60 264 220

31 057 000

91 321 220

112 204 000

+3.57

-53.53

+1.44

+3.58

-53.53

+3.39

266 755 254

363 708

3 902 006 991

-716 985 978 -2 122 803 978

11630/07 (Presse 166)

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OTHER ITEMS APPROVED

BUDGET 2007

Draft amending to the General Budget for 2007

13.VII.2007

The Council established, by qualified majority, a Draft Amending Budget No. 5 to the general

budget for 2007 as proposed by the Commission and instructed the Presidency to prepare the budget

documents to be sent to the European Parliament.

(11250/07)

EXTERNAL RELATIONS

EU/Lebanon Euro-Mediterranean Agreement - Enlargement

The Council adopted a decision on the signing and provisional application of a protocol to the Euro-

Mediterranean Agreement with Lebanon in order to take account of the accession of ten Member

States to the EU in May 2004

(11299/07, 11300/07).

The Euro-Mediterranean Agreement with Lebanon was signed in Luxembourg in June 2002 and

entered into force in April 2006.

11630/07 (Presse 166)