The EU’s budget shortfall for 2014 is "unprecedented" and will make it almost impossible to meet all outstanding payment obligations, especially in the humanitarian aid field, warned Commission officials during an EU external action monitoring group at Monday’s Budgets Committee meeting.
"We have a snowball of unpaid bills in the humanitarian aid field, commitments for which are continuously growing. We even have to pay interest on late payments to NGOs, which help to deliver our aid promises. This is exactly what we wanted to avoid politically", said 2014 budget rapporteur Anne Jensen (ALDE, DK), referring to legitimate payment claims rolled over from last year and the lack of willingness on the side of the Council to assure sufficient funding.
The budgetary shortfall in 2014 is "unprecedented", said DG Budget"s director-general Hervé Jouanjean. He described this year's budgetary situation as "very tense", not least because in other areas, such as cohesion policy, payment budgets are also far too low to meet outstanding commitments.
Unpaid bills "a millstone around our neck"
His colleague Claus Sörensen from the Commission’s humanitarian aid and civil protection department, DG ECHO, also stressed the mismatch between commitments and payments. "We just don't have the funds to match the commitments. This is a millstone around our necks", he said, adding that "we started the year with a backlog of €160 million and even had to negotiate with NGOs to accept a lower sum upfront, because we did not have the money to pay them."
He thanked the Commission’s enlargement and development and cooperation departments, "which helped us out by transferring €150 million to ECHO”, but added that “we need at least €250 million extra to meet our 2014 obligations. That will be enough to muddle through, but by the end of the year we shall again face a backlog of €160 million".
Aid to Syrian refugees and Palestine at risk
A third official, Michael Köhler, representing the Commission’s development and co-operation directorate-general, DEVCO, another key external aid provider, reported that it had been obliged to postpone 2013 payments amounting to €300 million to this year, also due to the mismatch between the budgets for commitments and those for payments. For aid to Syrian refugees in Jordan, Lebanon and Syria proper and aid to Palestine, DEVCO is running €100 million short, he added
Ukraine: "the big elephant in the room"
Mr Köhler also pointed to "the other elephant in the room", namely the €11 billion promised to Ukraine (€3 billion of which will come from the EU budget). "These transfers have to be made quickly, not in 5 or 6 years' time. This will eat up a lot of our funding for the EU neighbourhood policy", he said.
"Given the relatively low amounts at stake, it is pathetic that the EU cannot deliver on its external aid promises", concluded Ms Jensen.