'Monti' Group's first assessment of EU own resources

04-02-2015

The 'own resources' system, which ensures the financing of EU policies, has advantages such as reliability in providing the necessary resources, but has also attracted a number of criticisms, not least for its complexity and lack of real financial autonomy. The European Parliament (EP), which has little say in the design of the system, has long pushed for its reform. The aim is not to increase the size of the EU budget, but to focus it on issues of European common interest and to tap its full economic potential. However, the relevant decision-making process (unanimity and ratification by all Member States) represents a significant obstacle to reform. As part of the deal on the EU's Multiannual Financial Framework (MFF) for 2014-20, the EP, the Council and the European Commission have created a high-level group (HLG) on own resources. For the first time, an inter-institutional forum is tasked with a thorough review of the system. In December 2014, the HLG, chaired by Mario Monti, presented its first assessment report, which looks at the key features of the system and at recent reform attempts. In addition, the HLG sketches out the methodological approach that will guide its work, noting that the viability of reform recommendations will depend not only on the economic soundness of the proposals but also on careful consideration of the institutional and political aspects of the reform process. In 2016, the HLG will present the final outcome of its analysis, which national parliaments are expected to assess. The same year, in parallel with the planned review of the 2014-20 MFF, the Commission will examine whether the outcome of the work justifies new initiatives in the field of own resources, with possible reform of the financing of the EU budget for the period covered by the next MFF.

The 'own resources' system, which ensures the financing of EU policies, has advantages such as reliability in providing the necessary resources, but has also attracted a number of criticisms, not least for its complexity and lack of real financial autonomy. The European Parliament (EP), which has little say in the design of the system, has long pushed for its reform. The aim is not to increase the size of the EU budget, but to focus it on issues of European common interest and to tap its full economic potential. However, the relevant decision-making process (unanimity and ratification by all Member States) represents a significant obstacle to reform. As part of the deal on the EU's Multiannual Financial Framework (MFF) for 2014-20, the EP, the Council and the European Commission have created a high-level group (HLG) on own resources. For the first time, an inter-institutional forum is tasked with a thorough review of the system. In December 2014, the HLG, chaired by Mario Monti, presented its first assessment report, which looks at the key features of the system and at recent reform attempts. In addition, the HLG sketches out the methodological approach that will guide its work, noting that the viability of reform recommendations will depend not only on the economic soundness of the proposals but also on careful consideration of the institutional and political aspects of the reform process. In 2016, the HLG will present the final outcome of its analysis, which national parliaments are expected to assess. The same year, in parallel with the planned review of the 2014-20 MFF, the Commission will examine whether the outcome of the work justifies new initiatives in the field of own resources, with possible reform of the financing of the EU budget for the period covered by the next MFF.