2008 budget deal heralds shift in EU policy

For the first time, the EU will be spending more on competitiveness than agriculture. After a conciliation meeting last Friday, the Council and Parliament reached an agreement on the 2008 budget, securing an extra €2.7 billion for the EU’s two flagship projects – Galileo and the European Institute of Technology.

“For the first time in 2008 the Commission proposed […] higher spending for the competition, growth and jobs agenda than for agriculture. It was a historical proposal and today this proposal stayed,” said EU Financial Programming and Budget Commissioner Dalia Grybauskaitè after EU-27 finance ministers reached an agreement on the EU’s general budget for 2008. 

The budget, agreed on 23 November 2007 after a conciliation meeting with representatives from the European Parliament, includes financing for the European Institute of Technology and the European satellite navigation system Galileo up to 2013.

Following this agreement, Galileo will be funded entirely by the Community and the extra €2.4 billion needed will be mainly taken from agricultural expenditure not used in 2007 (€1.6 billion). The rest (€0.8 billion) will be drawn together by redeploying funds intended for other programmes and re-prioritising various amounts earmarked for research, as well as the unused margins in Heading 1a (Competitiveness and growth) of the Financial Perspective 2007-2013. 

Funding for the EIT, €300 million, is part of this financial package, which amounts to €2.7billion until 2013. 

“Parliament’s absolute priority in these negotiations was Galileo, as it is of huge political and technological importance for Europe. In the future, Europe will not be dependent on American, Russian or Chinese systems as it will have a system of its own,” said MEP Kyösti Virrankoski, Parliament’s 2008 budget rapporteur. 

Commission President José Manuel Barroso welcomed the agreement as a boost for growth and employment in the EU and said that the budget was “in line with our commitments under the Lisbon strategy”.

Parliament’s budget committee meets this week to vote on the amendments to be tabled at second reading. The plenary vote is set to take place on 13 December.

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