Beyond 2020

In “New boost for jobs, growth and investment”

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According to the Commission's work programme for 2018, in the second quarter of this year it will publish a package comprising a comprehensive proposal for the future Multi-annual Financial Framework (MFF) and new own resources beyond 2020. This will be followed by proposals for the next generation of programmes, based on Article 311 of the Treaty on the Functioning of the European Union (TFEU).

Under the regulation for the current Multiannual Financial Framework for the period 2014-2020, the Commission was expected to present a proposal for a new MFF for the period beyond 2020 no later than 1 January 2018. However, the result of the United Kingdom's June 2016 referendum on its EU membership has prompted the Commission to postpone publication of the proposal to May 2018, by which time the impact of Brexit on the EU's finances should be clearer.

The proposal on new own resources will reflect the ongoing debate on alternative own resources, on which a High Level Group on Own Resources published a report in December 2016, which in turn fed into a June 2017 Commission reflection paper on the future of EU finances. The reflection paper also refers to a March 2017 Commission white paper on the future of Europe, which set out five scenarios of varying scale and ambition. The Commission's proposal for the next MFF will reveal its thinking on which scenario should prevail, through the size and shape of the long-term budget it recommends.

According to the reflection paper, the next MFF will have to 'fund more with less' at a time when the EU's budget is shrinking yet it is under increasing pressure to do more to boost employment and growth, improve governance of the euro area, strengthen security and military cooperation, manage migration flows into the EU, and tackle climate change.

On 24 October 2017, the European Parliament responded to the Commission's reflection paper by adopting a resolution on the future of the EU's finances. In the resolution, the EP repeats its longstanding criticism that the current MFF is too small and too inflexible to respond effectively to old and new challenges facing the EU.

On 14 February 2018, the European Court of Auditors published a briefing paper on the Future of EU Finances, in which it called on the Commission to define EU value added, make the MFF more responsive to changing circumstances, and put more emphasis on performance.

On 14 February 2018, the Commission published a communication on the post-2020 MFF, setting out different scenarios for the next long-term budget along with the consequences of each. In it the Commission called on Member States to recognise that a budget of 'sufficient size' is necessary to implement new priorities, which should come about through 'an intelligent combination of proportionate savings, redeployments and fresh resources'.

On 14 March 2018, Parliament adopted an own initiative report on preparing its position on the MFF post-2020. At the same time, it also adopted a related own-initiative report on reform of the EU's system of own resources. The MFF report outlines the EP's expectations regarding the EU's financial priorities and the duration of the next MFF, as well as the need for more flexibility, a mandatory mid-term review, and changes to the special instruments and to the overall structure of the MFF headings. The report stresses the need to maintain existing levels of resources for traditional policies such as agriculture, fisheries and cohesion. It calls for a substantial boost to programmes supporting research (+50 %), Erasmus+ (tripling the current allocation), the Youth Employment Initiative (doubling the current allocation) and support for SMEs under the COSME programme (doubling the current allocation), and the Connecting Europe Facility. Furthermore, actions and policies related to new challenges in the areas of security, defence, migration, border control and macroeconomic stability should be properly resourced. Parliament estimates that, in order to ensure sufficient resources for these traditional and new priorities, the MFF ceiling should increase from the current 1.0 % to 1.3 % of EU gross national income. The report notes that new and 'genuine' EU own resources would be one way of financing this increase.

On 2 May 2018, the Commission published its legislative package comprising proposals for a post-2020 MFF. This was followed by proposals for each new spending programme, published in three waves in May and June.

 

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Author: Magdalena Sapala, Members' Research Service, legislative-train@europarl.europa.eu

As of 20/11/2019.