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Own resources of the European Union: Reforming the EU's financing system

06-10-2020

In July 2020, the European Council reached political agreement on the reform of the own resources system that finances the EU budget, in the context of a package including the new multiannual financial framework (MFF) and the Next Generation EU (NGEU) recovery instrument. The agreed increase in the maximum level of resources that can be called from Member States is a pre-condition for NGEU borrowing operations. The Council’s adoption of the own resources decision, translating the deal on the revenue ...

In July 2020, the European Council reached political agreement on the reform of the own resources system that finances the EU budget, in the context of a package including the new multiannual financial framework (MFF) and the Next Generation EU (NGEU) recovery instrument. The agreed increase in the maximum level of resources that can be called from Member States is a pre-condition for NGEU borrowing operations. The Council’s adoption of the own resources decision, translating the deal on the revenue side of the EU budget into a legal text, must be preceded by Parliament’s legislative opinion and followed by the ratification of the decision by all Member States. Parliament fast-tracked its legislative opinion, adopted in September 2020, to enable the Council to ensure the timely launch of NGEU. Parliament has repeatedly stressed that it will not give its consent to the MFF without proper reform of the financing system, and negotiations continue on the rest of the package. Notably, Parliament underlines that the introduction of a basket of new own resources should cover at least the repayment costs of NGEU. Deeming the new plastics contribution a first partial step in this direction, Parliament intends to negotiate a legally binding calendar on the introduction of five additional new own resources, linked to EU policies on climate and the single market. Second edition. The 'EU Legislation in Progress' briefings are updated at key stages throughout the legislative procedure.

Hearings of the Commissioners-designate: Johannes Hahn – Budget and Administration

26-09-2019

This briefing is one in a set looking at the Commissioners-designate and their portfolios as put forward by Commission President-elect Ursula von der Leyen. Each candidate faces a three-hour public hearing, organised by one or more parliamentary committees. After that process, those committees will judge the candidates' suitability for the role based on 'their general competence, European commitment and personal independence', as well as their 'knowledge of their prospective portfolio and their communication ...

This briefing is one in a set looking at the Commissioners-designate and their portfolios as put forward by Commission President-elect Ursula von der Leyen. Each candidate faces a three-hour public hearing, organised by one or more parliamentary committees. After that process, those committees will judge the candidates' suitability for the role based on 'their general competence, European commitment and personal independence', as well as their 'knowledge of their prospective portfolio and their communication skills'. At the end of the hearings process, Parliament votes on the proposed Commission as a bloc, and under the Treaties may only reject the entire College of Commissioners, rather than individual candidates. The Briefing provides an overview of key issues in the portfolio areas, as well as Parliament's activity in the last term in that field. It also includes a brief introduction to the candidate.

The next MFF and Own Resources

15-02-2019

Background Note for the BUDG Interparliamentary Committee Meeting of the European Parliamentary Week of 18 February 2019.

Background Note for the BUDG Interparliamentary Committee Meeting of the European Parliamentary Week of 18 February 2019.

Public opinion and the EU budget - Who supports the EU budget?

05-10-2018

The budget of the European Union (EU budget) provides the EU with the means to finance its policies and to respond to challenges which occur. Due to its scope, the perception of the EU budget is linked to citizens’ perception of the EU as a whole, its legitimacy and reputation, as well as the performance of the EU institutions. This briefing analyses public opinion surveys related to the EU budget, in particular citizens' preferences for greater EU financial means and their evaluation of the EU budget ...

The budget of the European Union (EU budget) provides the EU with the means to finance its policies and to respond to challenges which occur. Due to its scope, the perception of the EU budget is linked to citizens’ perception of the EU as a whole, its legitimacy and reputation, as well as the performance of the EU institutions. This briefing analyses public opinion surveys related to the EU budget, in particular citizens' preferences for greater EU financial means and their evaluation of the EU budget as 'good' or 'poor' value for money. It sets the analysis of public opinion in the context of debate on reforming the EU budget and on setting the next multiannual financial framework. According to recent Eurobarometer data, 37 % of Europeans support the EU having greater financial means given its political objectives, and 31 % think that the EU budget gives good value for money for EU citizens. Although the demand for greater support and the positive opinion of the EU budget both have positive trends over time, there is still much to be addressed. A closer look at the data demonstrates significant differences between the opinions across the Member States. Although a more sceptical trend can be observed amongst net contributor Member States, the diversity in the data cannot be explained only by the positioning of a country on the net contributor-net beneficiary continuum. The opinions of citizens across Member States vary in their values as well as in their direction of change over time. In addition, the opinions on the EU budget can be linked to personal factors - younger Europeans tend to express stronger support for greater EU financial means than older ones.

2021-2027 multiannual financial framework and new own resources: Analysis of the Commission's proposal

26-07-2018

The process of negotiating a new seven-year financial plan for the EU has now begun formally with the Commission's publication of proposals for a 2021-2027 Multiannual Financial Framework (MFF), and for a new system of own resources providing the revenue to pay for it. This analysis presents the proposed new MFF and own resources and compares them to the status quo, as well as to the European Parliament's priorities as expressed in plenary resolutions adopted in spring 2018.

The process of negotiating a new seven-year financial plan for the EU has now begun formally with the Commission's publication of proposals for a 2021-2027 Multiannual Financial Framework (MFF), and for a new system of own resources providing the revenue to pay for it. This analysis presents the proposed new MFF and own resources and compares them to the status quo, as well as to the European Parliament's priorities as expressed in plenary resolutions adopted in spring 2018.

Plenary round-up – Strasbourg, March 2018

16-03-2018

Highlights of the session included a debate on the future of Europe with Portuguese Prime Minister, Antonio Costa; and debates on preparation of the 22-23 March European Council meeting; on the appointment of the European Commission Secretary-General; on the US decision to impose tariffs on steel and aluminium; on corporate social responsibility; on conflict minerals; and on protection of investigative journalists, following the deaths of Jan Kuciak and Martina Kusnirova in Slovakia. High Representative ...

Highlights of the session included a debate on the future of Europe with Portuguese Prime Minister, Antonio Costa; and debates on preparation of the 22-23 March European Council meeting; on the appointment of the European Commission Secretary-General; on the US decision to impose tariffs on steel and aluminium; on corporate social responsibility; on conflict minerals; and on protection of investigative journalists, following the deaths of Jan Kuciak and Martina Kusnirova in Slovakia. High Representative, Federica Mogherini, made statements on Syria, the EU-Cuba Joint Council, and EU-Central Asia relations, followed by debates. Parliament adopted, inter alia, resolutions on the post-2020 future multiannual financial framework and own-resources reform; and legislative positions on the common (consolidated) corporate tax; regulation of cross-border parcel delivery; training of professional drivers; and Europass.

Reform of the EU's system of own resources

06-03-2018

In May 2018, the European Commission is expected to present a legislative package on what are known as 'own resources' – the sources of revenue for the EU budget – for the period after 2020, alongside proposals on a new Multiannual Financial Framework (MFF). The European Parliament has long pointed to shortcomings in the current system of own resources, and in anticipation of the Commission's proposals, the Committee on Budgets has drafted an own-initiative report on the Parliament's priorities. ...

In May 2018, the European Commission is expected to present a legislative package on what are known as 'own resources' – the sources of revenue for the EU budget – for the period after 2020, alongside proposals on a new Multiannual Financial Framework (MFF). The European Parliament has long pointed to shortcomings in the current system of own resources, and in anticipation of the Commission's proposals, the Committee on Budgets has drafted an own-initiative report on the Parliament's priorities. That report is on the agenda of the March plenary session.

"Other revenue" in the European Union Budget

15-11-2017

The Treaty on the functioning of the European Union divides the revenue of the general budget into two main components: own resources and other revenue. However, the wording of the Treaty indicates that other revenue should remain marginal compared to the own resources in the financing of the EU budget. Today, there are three main categories of own resources: i) traditional own resources, ii) VAT-based resource and iii) GNI-based own resource. The own resources system also includes a specific mechanism ...

The Treaty on the functioning of the European Union divides the revenue of the general budget into two main components: own resources and other revenue. However, the wording of the Treaty indicates that other revenue should remain marginal compared to the own resources in the financing of the EU budget. Today, there are three main categories of own resources: i) traditional own resources, ii) VAT-based resource and iii) GNI-based own resource. The own resources system also includes a specific mechanism for correcting budgetary imbalances in favour of the United Kingdom (the UK correction). In addition, some Member States may choose not to participate in certain justice and home affairs policies. Their own resources payments are adjusted accordingly.

The next Multiannual Financial Framework (MFF) and the Unity of EU budget

15-11-2017

The traditional issues of European budgetary negotiations are the size of the budget, the distribution of funds and the system of own resources. Under difficult circumstances, the negotiations on the new MFF post-2020 will start in 2018 and should be concluded by the end of 2019 or no later than the beginning of 2020. The unity of the EU budget is a cornerstone of European budgetary policy. However, a complete unity of all revenue and expenditure, and all financial instruments has not yet been achieved ...

The traditional issues of European budgetary negotiations are the size of the budget, the distribution of funds and the system of own resources. Under difficult circumstances, the negotiations on the new MFF post-2020 will start in 2018 and should be concluded by the end of 2019 or no later than the beginning of 2020. The unity of the EU budget is a cornerstone of European budgetary policy. However, a complete unity of all revenue and expenditure, and all financial instruments has not yet been achieved. Today the budgetary system is characterised by differentiation, fragmentation and increased use of ‘satellite’ instruments, and debates on additional financial instruments, like a budget for the Eurozone. The question of how to integrate these instruments into the Union’s budget system and thus guaranteeing democratic scrutiny, should be an additional issue of the negotiations on the MFF post-2020.

The next Multiannual Financial Framework (MFF) and its Flexibility

15-11-2017

This briefing note provides some reflections on the challenges facing the next Multi-Annual Financial Framework (MFF) and discusses ways to enhance the flexibility of the EU budget. An analysis of the use of existing flexibility provisions in the current MFF is followed by some recommendations on how to enhance flexibility in the post-2020 MFF.

This briefing note provides some reflections on the challenges facing the next Multi-Annual Financial Framework (MFF) and discusses ways to enhance the flexibility of the EU budget. An analysis of the use of existing flexibility provisions in the current MFF is followed by some recommendations on how to enhance flexibility in the post-2020 MFF.

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