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EU/S3/09/3/A
EUROPEAN AND EXTERNAL RELATIONS COMMITTEE
AGENDA
3rd Meeting, 2009 (Session 3)
Tuesday 3 February 2009 The Committee will meet at 10.30 am in Committee Room 1. 1. EU Budget Review inquiry: The Committee will take evidence, via video
conference, from—
James Elles MEP, South East of England, and Bill Newton Dunn MEP, East Midlands;
and then from—
Stephen Quest, Head of Cabinet, Cabinet of Dr Dalia Grybauskaite Commissioner for Financial Programming and Budget, Jennifer Brown, Deputy Head of Unit responsible for budgetary procedures and synthesis, and Johan Ureel, Head of Unit responsible for financing and budget forecasts of own resources, European Commission.
2. Brussels Bulletin: The Committee will consider the latest issue of the Brussels Bulletin.
3. EU Budget Review inquiry (in private): The Committee will consider the key
themes arising from the evidence sessions. 4. China Plan inquiry (in private): The Committee will consider a draft Interim
Report.
Lynn Tullis/Simon Watkins Clerks to the European and External Relations Committee
Room TG.01 The Scottish Parliament
Edinburgh Tel: 0131 348 5234
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The papers for this meeting are as follows— Agenda item 1
Paper on the EU Budget Review inquiry - oral evidence
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Agenda item 2
Brussels Bulletin
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Agenda item 4
Scottish Government's China Plan - Draft Report (Private Paper)
EU/S3/09/3/3 (P)
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European and External Relations Committee
3rd Meeting, 2009 (Session 3), Tuesday, 3 February 2009
EU Budget Review inquiry – oral evidence Background
1. At its meeting on 9 September 2008, the European and External Relations Committee agreed to undertake an inquiry into the implications of the EU Budget Review for Scotland.
2. The remit of the inquiry is to scrutinise the Scottish Government’s approach to the EU Budget Review and subsequent discussion on the EU budget including identifying the key issues of relevance to Scotland raised by the Review.
Oral evidence sessions
3. At its meeting on 2 December 2008 the Committee reviewed its approach to future oral evidence sessions. In particular, the Committee agreed to conduct its oral evidence sessions in several phases. The Committee agreed that the first phase should focus on undertaking preparatory work on the EU budget with a particular focus on “blue skies” thinking in relation to the EU budget for 2025. The Committee agreed to hold the following evidence sessions as part of phase 1:
Session 1: Examine the future trends and challenges for the EU (and how these will shape the EU budget of the future)
Session 2: The guiding principles and additional factors which will determine how the budget is allocated
Session 3: The implications of the above for Scotland.
4. The purpose of this second session is to take evidence from Bill Newton Dunn MEP and James Elles MEP and then from officials from the European Commission to consider the principles and criteria that should guide the determination of the EU budget of the future, such as EU added value, flexibility and transparency, as well as factors such as juste retour.
EU Added value (as a key principle), flexibility and transparency
5. As Members will be aware, on 12 September 2007 the Commission issued a communication launching a public consultation to inform the EU budget review entitled “Reforming the budget, changing Europe.”
6. The communication emphasised that EU spending must be based on an assessment of the added value of the different aspects of EU spending. In particular, it recognised that future European Union spending should; “provide clear additional benefits compared to action by individual member states
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alone in pursuing policies that promote the European common interest” (European Commission 2007).
7. The communication suggested that different elements determine whether EU spending meets the added value test and identified these as follows:
• Has a political nature – for example, to show solidarity, to increase visibility and to further the EU’s key policy objectives;
• Must offer return at EU level that could not be matched by national or local spending;
• Must be organised in such a way that spending meets it goals.
8. The communication went on to consider the balance between European and national spending. It indicated that subsidiarity and proportionality are core criteria to determine the added value of EU spending. Under the principle of subsidiarity, the EU should act only if the objectives of the proposed action cannot be sufficiently achieved by the Member States (or lower) but can rather, by reason of the scale or effects of the proposed action, be better achieved at EU level. Under the principle of proportionality, the content and form of EU action should not exceed what is necessary to achieve its objectives.
9. Many of the member states responding to the Commission’s consultation agreed that EU spending should be clearly additional to the spending undertaken by member states. For example, in its response to the consultation, the United Kingdom Government highlighted additionality as being one of the three principles by which the EU budget should be designed.
“the EU should only act where there are clear additional benefits from collective efforts or ‘EU added value’, compared with action by member states, either individually or in co-operation.” (HM Treasury 2008)
10. The UK Government identified two further principles around which a future EU budget should be designed. These were:
• EU action should be proportionate and flexible; and
• Should be subject to sound financial management.
11. In its response to the Commission’s consultation the Scottish Government sets out what it considered were the key principles which the budget should adopt:
“In line with the important principles of subsidiarity and proportionality, the Scottish Government believes that the EU budget should be better concentrated on areas of expenditure where Europe can add value compared with spending at the national and regional level. EU spending should also be better focussed on the new policy challenges which
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Europe faces and there should also be more flexibility to enable EU spending to adapt more quickly to the inevitable changes in priorities which occur during a seven year spending period.” (Scottish Government 2008)
12. Further background information about the EU Budget Review, including information about the principles such as EU added value, flexibility and transparency, is attached at Annexe A.
13. In addition, a note from the European Officer on the conference held on 12 November 2008 is attached at Annexe B and a copy of the presentation given by Dr Dalia Grybauskaite, Commissioner for Financial Programming and Budget, at the same conference is attached at Annexe C.
Information about the witnesses
14. James Elles is a British Conservative, and as such is a member of the Group of the European People's Party (Christian Democrats) and European Democrats (EPP-ED). He has been a member of the European Parliament since 1984. James Elles sits on the Parliament’s Committee on Budgets (responsible for contributing to the development of the multi annual financial framework) and the Committee on Budgetary Control (responsible for overseeing the implementation of the budget). Mr Elles was formerly a fonctionaire with the European Commission, working in agricultural policy. He holds a degree from Edinburgh University.
15. Bill Newton Dunn is a British Liberal Democrat, and as such is a member of the Group of the Alliance of Liberals and Democrats for Europe (ALDE). He has been a member of the European Parliament 1979 – 1994 and since 1999. From 1979 – 1994 and from 1999 – 2000, Bill Newton Dunn sat as a Conservative member. Bill Newton Dunn is vice chair of the Parliament’s Committee on Budgetary Control. Mr Newton Dunn formerly worked in industry and holds degrees from the Sorbonne, Cambridge and the Business School at Fountainebleau.
16. Stephen Quest is the Head of Budget Commissioner Dalia Grybauskaite’s Cabinet. As such he is responsible for the co-ordination of the Commission’s response to the EU Budget Review. He will be accompanied by Johan Ureel the Head of the unit within DG Budget responsible for budget reform and Jennifer Brown who is a member of DG Budget with responsibity for the current annual EU budget process.
Committee Clerk February 2009
EU/S3/09/3/1 Annexe A
Background to the EU Budget Review
1. Although the EU budget is agreed on an annual basis, a framework for European Union expenditure is agreed covering several years. This is known as the Multi-Annual Financial Framework (MAFF). The MAFF sets out the specific figures to be allocated to each policy area.
2. The agreement of the MAFF for 2007-2013 was one of the most controversial in the EU’s history. As a result of this, in May 2006 the European Parliament, Council and the Commission agreed that the Commission should undertake a fundamental review of the EU budget. The Commission was invited:
“to undertake a full, wide ranging review covering all aspects of EU spending, including the CAP, of resources, including the UK rebate, to report in 2008/9.”
3. On 12 September 2007 the Commission issued a communication launching a public consultation to inform the EU budget review entitled “Reforming the budget, changing Europe.”
4. The communication stated that the purpose of the review was not to propose a new MAFF for the period from 2014 nor the overall size and detailed breakdown of the EU budget. Rather it would:
• Set out the structure and direction of the EU’s future spending priorities;
• Examine how the budget works;
• Look at best way to resource EU policies.
5. The communication emphasised that EU spending must be based on an assessment of the added value of the different aspects of EU spending. It suggested that different elements determine whether EU spending meets the added value test and identified these as follows:
• Has a political in nature – for example, to show solidarity, to increase visibility and to further the EU’s key policy objectives;
• Must offer return at EU level that could not be matched by national or local spending;
• Must be organised in such a way that spending meets it goals.
6. The communication addressed each of these three elements. Firstly, under the heading “Preparing for tomorrow’s challenges” the Communication set out a list of eleven new policy challenges which would impact on where the EU directed its efforts in the future. The list includes the following:
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• The need to promote Europe’s values against a background of growing diversity and change and a more complex global environment;
• Globalisation driven scientific and technological progress making the European dimension important in boosting knowledge, mobility, competitiveness and innovation;
• The transformation to knowledge and service economy;
• Birth rates will change the structure and balance of societies;
• Solidarity and Europe’s commitment to social justice and the importance of economic and social cohesion;
• The impact of climate change;
• The pressures of climate change on the rural and marine environment;
• The need to obtain secure, sustainable and competitive energy;
• Migratory pressure;
• Security and safety to citizens presented by crime, terrorism or risks to transport, environment, health and safety;
• Globalisation and the need for Europe to have an effective presence worldwide.
7. Secondly, the Communication considered the balance between European and national spending. It indicated that subsidiarity and proportionality are core criteria to determine the added value of EU spending. Under the principle of subsidiarity, the EU should act only if the objectives of the proposed action cannot be sufficiently achieved by the Member States (or lower) but can rather, by reason of the scale or effects of the proposed action, be better achieved at EU level. Under the principle of proportionality, the content and form of EU action should not exceed what is necessary to achieve its objectives.
8. Finally, the Communication emphasised that European policies need effective and efficient delivery to secure the necessary added value. The Communication stated that EU institutions are accountable for the use of financial resources and they need to be able to demonstrate that the budget is managed according to the highest standards. Key issues arising:
• Balance between spreading support between a range of activities and concentrating the funds available;
• Balance between centralised and decentralised management;
• Enhanced simplification and strengthened delivery instruments;
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• Leveraging resources;
• The use of executive agencies;
• Co-financing;
• Ensuring full transparency, visibility and accountability in the management of the budget.
9. The Communication emphasised that this is linked to the issue of flexibility. The communication indicated that sound financial management could be better enhanced through greater flexibility, allowing resources to be reallocated between or within budget headings.
10. The consultation closed on 15 June 2008. The Commission received close to 300 contributions, including submissions from the UK Government and the Scottish Government. All submissions were published on the Commission’s website.
11. On 3 November 2008, in preparation for the conference (see below), the Commission published a summary of the consultation responses. The summary set out the key themes emerging from the contributions in connection with the following issues i) responsiveness to changing needs ii) main policy challenges iii) guiding principles iv) implementation and v) financing the budget.
12. The Commission reported that contributions generally agreed that the EU budget needed to reflect the current policy challenges, with climate change and enhancing European competitiveness receiving “an overwhelming attention in the contributions”. There was widespread support for reorienting spending priorities, with many contributions advocating reductions in spending on agriculture and increased spending on research and energy. Opinions considerably diverged on how Cohesion should be reformed.
13. In advance of the conference the Commission also published three studies that it had commissioned on the following areas to inform its preparation for the review:
• A study on EU spending
• Financing of the EU budget
• Meta-study on lessons from existing evaluations
14. The purpose of the Study on EU spending was to make proposals on the main areas of policy on which expenditure from the EU budget should be concentrated in future years. The study assesses the current EU budget, trends and future challenges and the future of the EU budget.
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15. In its assessment of the current EU budget the study considers whether a policy (in terms of public spending) is dealt with more efficiiently at national or at EU level. The study is divided into areas where the assessment concludes there should be no change in the EU budget (Competitiveness and the singe market, Social policies, Common Fisheries policy, Freedom Security and Justice), areas where a downward change would be required (Cohesion, agriculture and rural development) and where the assessment concludes an upward change would be required (Research, Environment, Common Maritime Policy and Foreign Policy).
16. In terms of the trends and future challenges for the EU the study identifies globalisation, the ageing European society, further future integration, enlargement and climate change.
17. Based on the assessment of the current budget and the prospects for the coming decades, the study proposes three policy packages to reform the budget in terms of expenditure i) Climate change and energy resources; ii) knowledge and innovation; iii) Common security and foreign affairs.
18. On 12 November 2008 the Commission hosted a conference to discuss the responses to the EU Budget Review consultation. Further information on the conference is provided at Annexes B and C.
February 2009 Committee Clerk
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EU/S3/09/3/1 Annexe B
REFORMING THE BUDGET - CHANGING EUROPE Conference in Brussels, 12 November 2008 Introduction In 2005, as a condition for signing off the EU’s seven-year financial framework, the UK secured a commitment to a ‘no taboos’ mid-term review of EU spending. As part of that process the Commission conducted a significant consultation and convened a conference in Brussels to discuss reform of the EU budget. It is the intention of the Commission to publish a paper of recommendations and guidance on budget reform during the remainder of its term (October 2009). The conference was attended by over 300 delegates representing a broad cross section of stakeholders and was addressed by Budget Commissioner Dr Dalia Grybauskaite, as well as the chair of European Parliament’s Budget Committee Reimer Böge MEP, and the French Secretary for European Affairs Jean-Pierre Joyet. The framework for discussion was determined by the findings of the recent the EU budget consultation (which ended on 15 June 2008). In total there were 26 speakers in six separate themed sessions: Competitiveness, the EU in the World, Solidarity, Added Value of EU Expenditure, Delivery Modes, and EU Financing to Support EU Policies. A full list of speakers and their presentations can be found here. Consultation findings The consultation sought views on: (i) future spending priorities for the EU; (ii) assessment of the current budgetary framework; and (iii) principles to guide the reform process. Spending priorities. Three clear priorities emerged from the process, and two existing priorities were considered in need of revision: • Climate Change. There was a demand for greater spending, particularly
to address emerging environmental threats. A number of respondents stressed that all EU policies should be aligned with environmental needs. There was a call for greater spending on research and development, as well as the emerging technology required to deal with climate/environmental issue.
• EU competitiveness in a global economy. There was a strong call for greater funding of research and development as well as more financial support for innovation in business and industry. There was also a belief that alignment of other policies could do much to help deliver competitiveness targets.
• Security of energy supply. Two themes emerged within this issue; improving the interconnectivity of the EU energy grid and increasing investment in research (particularly in the field of renewables and energy efficiency).
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• Cohesion. While cohesion funding was broadly supported, there was general consensus that policy change was required. There was a call for funds to be focused on less developed member states (rather than on less developed regions of relatively well developed states) to ensure economic convergence. It was also suggested that cohesion funds could be used to address global challenges.
• Agriculture. The majority of contributions focused on the need for urgent reform of agricultural spending. There was a strong sense that the goals of the CAP had to be re-written, with greater focus on supporting rural development and the gradual elimination of direct farm subsidies.
• Other issues. Demographic change (shrinking/aging population), inequalities (between countries and between regions) and external pressures (such as migration, securities issues).
Assessment of current budget framework. The components of the current financial framework were considered: • Gross National Income (GNI)-based contribution. This method of collecting
monies was considered to be acceptable since it allowed for monies to be gathered in a simple and transparent manner. There was also a general feeling that this method could be extended (possibly replacing other EU funding methods).
• VAT-based contribution. This method of revenue collection was considered to be cumbersome and there were a number of submissions calling for its elimination.
• Corrections. There are some 40 ‘corrections’ in the procedure for the determination of member state contributions to the EU budget (including the UK national rebate). There were strong calls for the elimination of this opaque and convoluted component of the budget.
• Alternative own resources. A number of contributions emphasised the possibility of securing monies by other methods.
Principles to guide reform. A number of principles emerged that should be deployed in the process by which the next budget is set: • The determination of the budget should be far more transparent. In
particular the public should be able to see how the budget is being set. • The budget structure should be simplified and include all EU expenditure. • Member states should be held to greater account, since they are
responsible for the spending of 80% of the budget • There should be more flexibility within the budget to allow the EU to deal
with emerging issues (e.g. the financial crisis). • The ‘centre of gravity’ of the budget should be moved away from
agriculture/rural affairs. Key issues and problems under discussion Size of EU budget. The EU Multi-annual Financial Framework (MAFF) for the period 2007–2013 is €864.3b, which represents 1.05% of the EU-27’s GNI forecast for the period. There was general agreement that the size of the budget was unlikely to increase overall. If the money is to remain the same
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then the key debate would be around re-programming the budget, i.e. moving money from old (primarily agricultural) priorities toward new priorities. The future of ‘juste retour’. The concept of juste retour, whereby each member state seeks to secure the maximum return of its budget contribution for national priorities, rather than allowing the EU to focus on community-wide priorities, is as strong as ever. It is considered one of the principle reasons for the limited success of the Lisbon agenda (‘old’ member states do not wish ‘new’ member states to receive a greater share of funding, even although their need is greater) and will be one of the principle obstacles to reform of the CAP (with France, a significant beneficiary, unlikely to allow the spend to be re-prioritised away from subsidy). Unpopular though it is, the elimination of the mind set of juste retour was considered highly unlikely. Criteria for determining Community/member state competence. All EU spend should add a value which cannot be added by the member state acting alone. Should focus therefore be more upon cross border issues, e.g. energy security, migration, common environmental concerns, rather than the current priorities which could more sensibly be dealt with by the member state alone? This follows on from the juste retour concept. Is it sensible to give money to the EU, only for the EU to effectively return it to member states to spend on member state issues (subsidiarity)? Would there not be more merit in returning certain priorities to member state competence, e.g. regional policy or even agriculture? Stability v. flexibility. While member states require certainty in both their contribution and in the funds which they shall receive for specific priorities, the current arrangement does not allow for flexibility. This is considered a serious problem, particularly when (unexpected) issues such as the financial crisis emerge. Should greater flexibility and Community level discretion on spend, be factored into future financial settlements? Could a contingency fund be established to deal with as yet unknown threats? How should the money be raised? Although many speakers saw merit in a specific EU tax, they were realistic in their assessment of the likely success of such a proposal. Most speakers were in favour of developing (and increasing) the GNI contribution while reforming or eliminating the other more complex methods of securing funds. All were agreed that ‘corrections’ had to be eliminated. Emerging revenue sources, such as the monies raised by the auctioning of carbon credits (EU Emissions Trading Scheme) were also discussed. Institutional issues. Members of the European Parliament and representatives of the Commission who spoke were strong in their advocacy for a greater role for the institutions in both the determination of priorities as well as oversight of progress. This view was not shared by the French Europe Minister Jean-Pierre Joyet, who spoke on behalf of the French EU Presidency. This debate is likely to be at the heart of the negotiations that will determine the next EU budget. There was agreement on trying to synchronise the budget, parliamentary election and Commission cycles.
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Priorities for the future. There was general agreement that determining priorities without allocating funding to them served little purpose - rhetoric alone was not enough. In the absence of securing additional funds, much of the progress in this area will be driven by CAP reform. Next steps The Budget Commissioner has indicated her intention to bring forward a Communication outlining a series of recommendation on budgetary reform. Although no exact date has been given, there was a strong indication that the paper would appear before the summer recess in August 2009. European Officer November 2008
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Reforming the Budget, Changing Europe
Results of the public consultation
Dr. Dalia GrybauskaitėCommissioner for Financial Programming and Budget
Conference “Reforming the Budget, Changing Europe”Brussels, 12 November 2008
2
Public Consultation: Main findings
Strong confirmation: active debate proves Europe aspires to change, budget seen as a potential force for this new shift;
One message, hundreds of voices: all contributions urge for modern budget to confront risks and challenges facing the Union;
Consensus: similar concerns dominate majority of contributions, fully matching Commission's own vision on Union’s priorities;
Basic parameter: European added value is seen as a core criterion for spending at EU level;
Heavy opposition: “juste retour” approach is considered as poison of the EU budget and deserves to be eliminated;
©European Commission
3
All Member States presented their official contributions;
Over 2.000 people in 20 countries directly debated budget reform;
300 contributions represent broad diversity of interests.
Diversity of parties represented confirms EuropeDiversity of parties represented confirms Europe’’s total willingness s total willingness to move forward on bold reformto move forward on bold reform
Common desire for change
©European Commission
NGO20%
Private sector14%
Citizens12%
Other7%
Universities/scientists13%
Public/governmental sector
34%
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Europe’s biggest challenges
At the top of the list:
Climate changeTwo thirds of contributors consider it Europe’s big test for future;
EU competitiveness in a global economyOne in two respondents put growth as Union’s main challenge;
Energy supply securityJust as many are concerned about energy issues.
Other areas of serious concern:Inequalities between countries, regions;Demographic trends - shrinking/ageing population; External pressures, security threats, migration
©European Commission
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A new direction for EU spending /1
Competitiveness, research, innovationCall to significantly increase R&D spending; Urge for wider financial support for industry & business innovations;Focus other policies on improving competitiveness;
Environment, climate changeCall for increasing direct spending for this area; More spending on R&D supporting environmental objectives; Align other policies with environmental needs;
EnergyImprove energy supply security by promoting energy interconnection;Concentrate research efforts on energy efficiency;Invest in energy efficient technologies;Increase direct spending on developing renewable energy sources;
Contributions move spotlight to policies for future:
Policies geared towards growth and economic progress are at the top of spending priorities ©European Commission
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A new direction for EU spending /2
= Cohesion – support
signalled, policy change required
concentrate funds on less developed MS and regions;
focus policy on economic convergence;
extend it to respond to global challenges;
Agriculture – one of the hottest topics of consultation
spending on agriculture needs reform;
maintain CAP as policy aligning with new common goals;
less for CAP: gradually eliminating direct aid;
reinforce pillar 2, co-financing pillar 1;
shift rural development to cohesion policy;
Cohesion + Agriculture = 2/3 of the EU budget Cohesion + Agriculture = 2/3 of the EU budget Massive attention on spending in these areas easily explained Massive attention on spending in these areas easily explained
©European Commission
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Financing a budget for the future
Traditional Own Resources - widely supported;
GNI-based contribution - strong emphasis it’s working well, could be extended;
VAT-based contribution – urge to simplify the system by eliminating this resource;
Corrections – total disappointment with non-transparent system, loud call to eliminate exemptions;
Alternative own resources - calls to "keep the door open“, examine new possibilities linked to policy priorities.
©European Commission
The complex EU revenue system needs radical changes towards clarity, simplification and transparency
To ensure resources match political ambitions:
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Striving for better delivery
Delivery must be focused on performance
and final results
Strong call to enhance effectiveness and efficiency;
Different ways to improve are proposed:
Increase transparency and public access of EU budget;
Simplify budget structure, integrate all expenditure in budget;
Strengthen responsibility of MS who manage over 80% of budget;
More budget flexibility to respond immediately to changing needs;
©European Commission
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Lessons to draw
Reform is the only option: desire for change strongly confirmed;
Money to deliver objectives: new budget must open door to new ideas, refocus spending on future challenges, not past;
Shift the centre of gravity for future budget: competitiveness, environment, energy – on the top of the list of priorities;
Fair and transparent mechanism of contributions vital: complex web of corrections has no longer any justification;
Dynamic times require flexibility: unlock budget from rigid “headings”, improve capacity to respond to evolving challenges;
The essential condition for a modern budget is there: open-mindedness, resolution and strong support for major change
©European Commission
A budget for a fast-moving world:
EU/S3/09/3/2
European and External Relations Committee
3rd Meeting, 2009 (Session 3), Tuesday, 3 February 2009
Brussels Bulletin Background
1. At its meeting on 18 March 2008 the Committee agreed to include the Brussels Bulletin on the Committee’s agenda. The latest Brussels Bulletin – Issue 24 February 2009 is attached at Annexe A.
Purpose of the Brussels Bulletin
2. As Members will be aware, the Brussels Bulletin is produced by the Parliament’s European Officer and is based on the key themes identified by the Committee as a result of its consultation on the Commission’s Legislative and Work Programme for 2008. At its meeting on 19 February 2008, the Committee agreed that the European Officer should focus on four key themes over the coming year:
• Energy and Climate Change • Maritime Issues (including Fisheries) • Structural/Reform Issues • Economic and Social Issues
3. The European Officer provides early intelligence on expected developments, actions of the key players and detail of debate on these key themes, primarily through the Brussels Bulletin. This is circulated to the subject committees and published on the website. More detailed briefing can also be commissioned by a committee on any specific issue.
Recommendation 4. The Committee is invited to note the latest issue of the Brussels Bulletin.
Committee Clerk February 2009
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NEWS IN BRIEF
Czech Presidency priorities The Czech Republic took over the presidency of the European Council on 1 January 2009.
The Czech Prime Minister, Mirek Topolánek, outlined the priorities of his country’s presidency in an address to the European Parliament. He summarised his country’s endeavours as the three Es - the economy, energy and external relations.
ISSUE 24 FEBRUARY 2009
IN THIS ISSUE:
News The Czech Presidency Other news
Upcoming meetings & events Contact details
Economy. The Czech Presidency will be responsible for the development and co-ordination of the EU position for a number of key events, including the preparation of the EU position for the G20 summit (2 April 2009), and the assessment that will take place in advance of the EU Summer summit (18 – 19 June 2009). A number of pieces of legislation will also be advanced including support for SMEs, as well as various measures to address issues of governance and transparency within the financial markets.
Energy. The Czech Presidency intends to focus upon energy security. To that end a number of negotiations will be opened with Russia and other key energy powers and customers. A number of residual energy issues will also be advanced during the Presidency including issues around industrial pollution, bio-waste and eco-labelling. External relations. The Czech Presidency intends to advance EU relations with a
number of powers including the US, Russia, and the Balkans. The inauguration of a new president is likely to lead to reinvigoration of the debate around energy, terrorism and potentially the Middle East.
Relations with Russia and its neighbours, over various energy issues, are also likely to be important. Croatian accession to the EU is also likely to be progressed during the Czech Presidency. Other issues A number of other issues are being discussed in the EU, including: (i) pesticides; (ii) the future of the EU; (iii) energy: (iv) health; (v) and the environmental challenges of 2009.
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CZECH PRESIDENCY: Overview Proposal N/A Current status The Czech Presidency of the European Council began on 1 January 2009 and will continue until the end of June 2009. The Czech’s will be succeeded by the Swedes on 1 July 2009. What’s happening The Czech Prime Minister, Mirek Topolánek, presented the work programme of his Council to the European Parliament (14 January 2009). The principal focus of the programme will be the three Es: economy, energy and external relations. Further detail on the programme is outlined below. Economy. The Czech government will preside over a number of the important discussions regarding the current financial crisis. Of particular importance will be the Spring Council (19 – 20 March 2009), to which the high level de Larosière group (established by the Commission to examine the financial situation) will report, and at which the EU position for the G20 meeting will be decided, and the Summer Council (18 – 19 June 2009) where progress on addressing the financial situation is expected to be assessed.
In addition, the Czech’s will also be responsible for: (i) co-ordinating the EU position, and leading the EU delegation, to the G20 meeting of the world’s leading economies in London, (2 April 2009). The Czechs will also include any issues emerging from the meeting; (ii) overseeing the drafting of support measures aimed at SMEs; (iii) overseeing the drafting of measures required to ensure better governance
and transparency in the financial markets; and (iv) [possibly] overseeing the publication of the Commission Communication on the Budget Review. Energy. Energy issues are high on the agenda of the new Presidency, particularly energy security, with the Czech PM during his speech adding a ‘g’ to his three Es in the form of ‘gas crisis’. Given that the energy package was largely settled during the French Presidency, with the formality of sign-off expected shortly, the Czech’s are expected to focus upon improving relations with the various energy producers (in particular Russia and the Ukraine) and their customers (particularly in eastern Europe) in an attempt to ensure continuity of gas flow (see below).
The Czech Presidency intends to assist in the identification of priority infrastructure projects and intends to initiate improvements in the legal base, both internally and with third countries and regions. Other energy & climate change related issues. Several other proposals are expected to progress toward conclusion during the Czech Presidency including; (i) Integrated Pollution Prevention & Control Directive, where first reading agreement is expected; (ii) publication of a response to the green paper on biowaste; (iii) Eco-label Directives, where first reading agreement is expected; (iv) reconsideration of the previously dormant Soils Directive. External relations. The inauguration of US President Barrack Obama is expected to change the nature of EU - US relations, with an emphasis on a
BRUSSELS BULLETIN 3
‘new beginning’. Areas likely to be important will include the conflict issues Afghanistan, Gaza (and the broader Middle East) and Iraq, and relations with Russia. Terrorism is expected to continue as a key issue; the new US administration is expected to bring a different tone to the discussion. The Czech Presidency is optimistic that President Obama will attend an informal EU-US summit tentatively scheduled for 4 April 2009.
Also prominent on the agenda to be taken forward by the Czech Presidency will be climate change, with a significant change in the US position expected.
The Czech Presidency will chair the next EU – Russia summit (16 May 2009), with energy likely to be high on the agenda. The Czechs also intend to host a 'Southern Corridor Summit' (the ‘Nabucco summit’) on energy to start a dialogue with transit countries in the Caspian region. (The date of this meeting is not yet available).
Prague also intends to organise the opening summit of the Eastern Partnership, launched by the Commission (3 December 2008), which will involve the EU leaders and their opposite numbers in Ukraine, Moldova, Georgia, Armenia, Azerbaijan and Belarus.
CZECH PRESIDENCY: detail Proposal N/A Current status Each of the Czech ministers presented their respective Presidency priorities to the relevant committees of the European Parliament (20 – 22 January 2009). What’s happening? Finance. The Czech Finance Minister, Miroslav Kalousek, presented the economic priorities of the Presidency to the Parliament’s Economic and Monetary Affairs Committee (21 January 2009). He emphasised that the economy was a priority and that the aim of the Presidency was to mitigate the impact of the crisis on business now whilst laying the foundations for sustainable growth and job creation for when the crisis has passed. The key features of the Presidency will be: • Implement the European Economic
Recovery Plan (agreed at the December Council).
• Monitor the implementation of the road maps that followed agreement at the Washington G20 meeting.
• Oversee discussion of the report by the de Larosière group, likely to begin with the April 2009 ECOFIN meeting.
• Directives on capital requirements and solvency are likely to be concluded during the presidency, with progress expected on directives addressing indirect taxation and the regulation of credit agencies.
Croatia’s admission to the EU is expected to progress during the Czech Presidency, although it is less clear whether progress can be expected on Turkish accession.
Justice. The Czech Justice Minister, Jiří Pospíšil, presented his priorities to the Civil Liberties, Justice and Home Affairs Committee (21 January 2009). His key priorities included:
Lisbon Treaty. The Czech Prime Minister’s remarks on the Lisbon Treaty were less well received. The Czech Republic remains one of only two countries that have not ratified the treaty. • The framework decision on
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prevention and settlement of conflicts across jurisdictions (agreement expected shortly).
• E-justice proposals. • Amendment of the framework
decision on combating child pornography and exploitation of children.
• The framework decision on trafficking of human beings.
Mr Pospíšil also stated that his government would revisit the Rome III regulation, focusing on issues of enhanced cooperation. Employment & Social Affairs. The Minister responsible for employment, Peter Nečas, addressed the Employment and Social Affairs Committee (20 January 2009). His priorities include: • free movement of workers, both in
geographic terms and between jobs. • increasing employment and the
flexibility of the labour market through flexicurity guidelines.
• ensuring horizontal support for families within all EU policies.
• improving the role of social services as a tool for social inclusion.
Industry & Trade. The trade minister, Martin Říman, addressed the Internal Market and Consumer Protection Committee (21 January 2009). The minister emphasised the European Economic Recovery Plan, particularly in reference to simplification procedures, faster implementation of Community programmes and the increase in intervention by the EIB especially for SMEs. The Presidency intends to focus on delivering the European Small Business Act, and cutting the administrative burden falling on SMEs.
Constitutional affairs. Alexandr Vonda, Minister of European Affairs, addressed the Constitutional Affairs Committee (22 January 2009). He stated that the Presidency could be divided into two halves; the period before the Spring Council when the Presidency would deal with policy objectives (energy, economy and external affairs); and the period after, which would concentrate on preparations for the European Parliament elections and the Summer Council.
The Czechs would also be responsible for overseeing the drafting of the ‘Irish’ guarantees that emerged from the December Council. Environment. The environment minister, Marin Bursik, addressed the Committee on Environment, Public Health and Food Safety (21 January 2009). The four priorities for the Presidency would be: climate change (in particular preparation for the December 2009 Copenhagen UN Climate Conference); environmental protection and effects on public health (including amendment of the Integrated Pollution, Prevention & Control (IPPC) Directive, regulation of Ozone depleting substances, delivery of the proposals contained within the thematic strategy on soils and the environmental issues associated with mercury); sustainable production and consumption (with proposals on the Ecolabel scheme and the eco-management and audit scheme (EMAS) likely to be progressed); and biodiversity (where the focus will be on alien species).
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OTHER NEWS • Pesticides. The European Parliament
has endorsed the Commission’s proposals on pesticides (13 January 2009). The proposals will now go before the Council (likely to be in February or March 2009). The UK, Ireland, Spain and Hungary still oppose the package and final endorsement in the Council is by no means certain.
• The Wise Men. The reflection group (termed the ‘wise men’) established by the European Council (14 December 2007) to identify the key issues which the EU is likely to face in the future and how these might be addressed is currently considering whether to conduct its deliberations in public or private (21 January 2009). The chair of the group, Francisco Gonzalez, has stated that the group is considering several priorities including: (i) how to maintain Europe's model of social cohesion in the 21st century; (ii) the challenges of energy and climate change; (iii) the demographic issues affecting the EU; (iv) the challenges of terrorism and organised crime; (v) the challenges resulting from conflict zones around the EU’s borders and further afield.
• 2nd strategic energy review. The European Parliament will debate the contents of the review at its plenary session on 2 February 2009, with a vote expected the following day. The parliament will also discuss its report on oil supply and security (which has a particular focus on emergency oil reserves).
• European Supervision order. The Parliament will deliver its opinion on the Commission proposal at its
plenary session of 24 March 2009. The rapporteur on the issue is Ioannis Varvitsiotis MEP of the Parliament’s Civil Liberties Committee.
• Equal opportunities in arts. Debate on the own initiative report of Claire Gibault (Women's Rights and Gender Equality Committee) on the issue of Equal treatment and access for men and women in the performing arts will take place in the Parliament on 12 March 2009.
• Health care conference. The Czech Presidency of the Council has stated that it will host a high level conference on the financing of health care systems (10 - 12 May 2009). The conference is expected to address issues around the evolving demands on healthcare and financial sustainability.
• Environmental challenges. The European Environment Agency has published its priorities for 2009 (12 January 2009). The key priorities include the review of the CAP, the issues around biofuels, the impact of alien species on biodiversity, marine management and the import/export of waste. For full details click here.
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UPCOMING EVENTS & MEETINGS
February 2009 January 2009
26 – 27 General Affairs Council: discussion on energy, general external affairs and the financial situation
2 Parliamentary discussion of the 2nd EU Strategic Energy review
9 – 10 Visit of the Scottish Parliament Economy, Energy and Tourism Committee
10 Conference on supervision of the EU banking sector. sponsored by Euractiv, the leading EU policy commentator.
9 - 13 European Sustainable energy Week; the Scottish Government will be represented by Jim Mather MSP, Minister for Enterprise.
10 ECOFIN Council 10 Bureau, Committee of Regions 11 Workshop on sustainable
energy, Brussels.
12 - 13 Plenary session of the Committee of the Regions
18 – 20 e-Health Conference, Brussels 19 Energy Council 23 – 24 Agriculture & Fisheries Council 26 - 27 Justice Council 28 Closing date, Green Paper on
Territorial Cohesion
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CONTACT DETAILS Dr Ian Duncan Rond Point Schuman 6 B – 1040 Bruxelles Tel: 0032 2282 8377 Fax: 0032 2282 8379 Email: [email protected]
