Convention in favour of co-decision for the budget procedure

A majority tendency in favour of applying
co-decision to the budget procedure emerged from the
Convention’s debate of the Union’s finances on 4
April.

69 amendments to the three articles dealing with the
Union’s finances point towards a consensus in favour of
formalising the multiannual financial perspective, setting
mandatory ceilings for each category of expenditure.

On the other hand, there are serious
disagreements over the idea of a Community tax and on the
decision-making procedure for the budget.

A number of speakers favoured the
introduction of a Community tax, taking the view that as
things stand the term ‘own resources’ is something of a
misnomer, since what is involved is essentially direct
contributions from the Member States. However, a number of
speakers expressed outright opposition to a Community
tax.

A majority of speakers argued in favour
of greater flexibility in the budget procedure, expressing
the view that unanimity in Council should give way to
qualified majority voting and that Parliament should
participate as an equal partner.

Numerous speakers argued in favour of
integrating the financial perspective into the new
Constitution.

 

The Convention Vice-Chairman,
Mr Jean-Luc Dehaene

, underlined the risks that would arise should unanimity be
retained for budget matters in an enlarged Union.

Commissioner Michel Barnier

expressed doubt whether unanimity could be retained for
budget matters in a Union enlarged to 25 or 30 Member
States. He felt that a number of criteria needed to be met:
reinforced QMV in Council, the EP's assent, and close
involvement of the national parliaments.

Mr Henning Christophersen

, chair of the working group on the Union's budgetary
procedure, said there was a consensus in the group in
favour of including the financial perspective in the
Constitution, thus giving it the status of a Union law
rather than of an interinstitutional agreement as was the
case today. The legal-financial framework should, in the
working group's view, be adopted, on a proposal by the
Commission, by the European Council with the assent of
Parliament. Mr Christophersen pointed out that if, as a
majority of the Convention seemed to wish, the distinction
between compulsory and non-compulsory expenditure was to be
abolished, a provision would have to be added guaranteeing
that the Union will honour its obligations to third
parties.

Concerning the annual budget procedure,
the
working group

favours conferring a fully-fledged right of initiative on
the Commission. It also proposes that the consultation and
conciliation procedures which currently take place under
the interinstitutional agreement should be incorporated
into the budget procedure, and that the trialogue should be
given formal status. In addition, the group advocates a
budget procedure based on simplified co-decision, with one
reading only by each arm of the budgetary authority.

Mr Peter Hain

, the UK Government representative, said he could only
accept budgetary co-decision if there were mandatory
ceilings. Such ceilings should remain a matter for the
European Council, and in any other circumstances he could
not accept abolishing the compulsory/non-compulsory
distinction for expenditure.

 

On 4 April, the Convention debated draft Articles 38 to 40
that make up
Title VII - Union Finances

of the draft Constitutional Treaty. These are:

  • Article 38 - The Union's resources;
  • Article 39 - The budgetary and financial
    principles;
  • Article 40 - The Union's budgetary procedure.

 

At the next plenary session, on 24 and 25 April, the
Praesidium will present the final set of articles, on the
subject of the institutions. The debate will be held during
the session on 15 and 16 May.

At the session on 24 and 25 April, the
Convention will debate the draft on practice of democracy
and EU membership.

The special European Council on 16 April
in Athens will discuss the institutional issues, which the
Convention has not yet begun debating.

The Convention is due to present its
final proposal for a new Constitutional Treaty by the end
of June, to be discussed by EU leaders at a special
European Council on 30 June.

 

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