53

result(s)

Word(s)
Publication type
Policy area
Author
Keyword
Date

How flexible is the EU budget? Flexibility instruments and mechanisms in the multiannual financial framework (MFF)

23-01-2020

The 1988 introduction of multiannual financial frameworks (MFF) in the European Union (EU) budgetary system has improved financial predictability and facilitated the development of multiannual spending programmes, but has had to be balanced by measures that provided some flexibility and ability to react to unexpected situations. Over the years, these flexibility instruments and mechanisms have developed and proved to be useful. Occasions to use them were frequent, as the crises and challenges faced ...

The 1988 introduction of multiannual financial frameworks (MFF) in the European Union (EU) budgetary system has improved financial predictability and facilitated the development of multiannual spending programmes, but has had to be balanced by measures that provided some flexibility and ability to react to unexpected situations. Over the years, these flexibility instruments and mechanisms have developed and proved to be useful. Occasions to use them were frequent, as the crises and challenges faced by the EU required actions that could not be financed under the tight expenditure ceilings of the agreed MFFs. Experience of implementation of the 2014-2020 MFF demonstrated that, with neither relevant flexibility mechanisms nor the possibility to revise the MFF in the mid-term, achieving policy goals and reacting adequately to unexpected events and crises, especially in the area of migration and security, would be impossible. The flexibility of the EU budgets has already featured as an important issue in the negotiations of the 2021 2027 MFF. The views of the main actors – the European Commission, the Parliament and the Council – on enhancing and designing such flexibility instruments diverge. It has yet to be seen if the issue, following the pattern of the 2014-2020 MFF negotiations, will play a key role in reaching an agreement.

The 2021-2027 Multiannual Financial Framework in figures

24-01-2020

The Multiannual Financial Framework (MFF) sets the maximum level of resources (‘ceiling’) for each major category (‘heading’) of EU spending for a period of seven years. In addition to a financial plan, it sets the EU’s long-term priorities. With the 2014-2020 MFF nearing its end, the EU is now in negotiations on the next long-term budget. In May 2018, the European Commission presented a package of legislative proposals for the 2021-2027 MFF. Equivalent to 1.11 % of EU-27 gross national income (GNI ...

The Multiannual Financial Framework (MFF) sets the maximum level of resources (‘ceiling’) for each major category (‘heading’) of EU spending for a period of seven years. In addition to a financial plan, it sets the EU’s long-term priorities. With the 2014-2020 MFF nearing its end, the EU is now in negotiations on the next long-term budget. In May 2018, the European Commission presented a package of legislative proposals for the 2021-2027 MFF. Equivalent to 1.11 % of EU-27 gross national income (GNI), it takes into account the initiatives to which the Member States committed in the Bratislava and Rome declarations, as well as the loss of a major contributor due to the United Kingdom’s withdrawal from the EU. The European Parliament considers the proposal insufficient, given all commitments and priorities, and estimates that the MFF ceiling should amount to 1.3 % of EU-27 GNI. The Member States’ views on both the size and other aspects of the future MFF diverge, and the Council has not yet agreed its position. EU leaders are expected to take the next important decisions on the matter during the first half of 2020. The resources proposed for the 2021-2027 MFF are distributed across seven headings, representing the EU’s long-term priorities. They include spending programmes and funds that are the basis for the implementation of the EU budget. Our infographic provides a breakdown of the proposals for each of the seven headings, as well as an indication of the changes from the current MFF (2014-2027) represented by both the Commission's proposal and Parliament's position on that proposal.

Cohesion funds, values and economic and monetary union in the 2021-2027 MFF: European Parliament position on Heading 2 – Cohesion and values

21-01-2019

Heading 2 – Cohesion and values – is the biggest in terms of budget in the multiannual financial framework (MFF) proposed by the European Commission for the 2021 to 2027 period. It is also the most diversified heading in terms of the types of programme and fund included. It encompasses expenditure on cohesion, one of the EU's long-standing policies, on an entirely new budgetary instrument supporting economic and monetary union, and on other increasingly important goals, including youth employment ...

Heading 2 – Cohesion and values – is the biggest in terms of budget in the multiannual financial framework (MFF) proposed by the European Commission for the 2021 to 2027 period. It is also the most diversified heading in terms of the types of programme and fund included. It encompasses expenditure on cohesion, one of the EU's long-standing policies, on an entirely new budgetary instrument supporting economic and monetary union, and on other increasingly important goals, including youth employment, the creative sector, values, equality and the rule of law. Under this heading the Commission is proposing to almost halve the Cohesion Fund and double the Erasmus+ programme. Moreover, some of the programmes included fall under shared management between the Commission and EU Member States, while some are managed directly by the Commission. This briefing presents Heading 2 in detail, on the basis of previous EPRS publications on the 2021-2027 MFF proposal. It aims to provide some clarity on its structure and allocation in comparison with the current MFF, based on the Commission's proposal for the 2021-2027 MFF and the European Parliament's negotiating position adopted on 14 November 2018. The analysis is structured around three issues: the introduction to the EU budget of a new budgetary instrument for economic and monetary union, a change in the allocation for cohesion policy, and the merging of programmes supporting people, social cohesion and values.

Economic and Budgetary Outlook for the European Union 2019

30-01-2019

This EPRS study, the third in an annual series, provides an overview of the economic and budgetary situation in the EU and beyond. It summarises the main economic indicators in the Union and euro area, and their two-year trends. The figures show that growth was moderate in 2018, at 2.1 %, although this is expected to deteriorate slightly in the coming months, given the poorer global outlook than a year ago. That said, unemployment is at a post-crisis low, and is expected to improve further, given ...

This EPRS study, the third in an annual series, provides an overview of the economic and budgetary situation in the EU and beyond. It summarises the main economic indicators in the Union and euro area, and their two-year trends. The figures show that growth was moderate in 2018, at 2.1 %, although this is expected to deteriorate slightly in the coming months, given the poorer global outlook than a year ago. That said, unemployment is at a post-crisis low, and is expected to improve further, given positive labour market conditions. The study explains the annual EU budget, providing an overview of its headings for 2019, with the total amounting to €165.8 billion (or around 1 % of EU gross national income). The budget focuses on priorities that include stimulating investment, growth and research, the creation of new jobs – especially for young people – and addressing migration and security challenges. The wider budgetary framework – the multiannual financial framework (MFF) – is also analysed in the study, with key decisions on spending for the 2021-2027 period due to be taken during 2019. In this year's edition, the special 'economic focus' offers a bird's eye view of SMEs and SME policy in Europe, and of various recent EU-level initiatives in this field. The EU budget devotes particular attention to SMEs, given their central role in the European economy and in job creation. The EU needs to continue devoting efforts to improving European SMEs' access to finance, since despite recent improvements, they are still too heavily reliant on debt financing which puts them at risk in a downturn.

Performance budgeting: A means to improve EU spending

16-03-2018

In 2015, the European Commission launched an initiative entitled 'The EU budget focused on results'. It is aimed at changing spending culture and making results a horizontal priority for the EU budget. The initiative is based on a popular contemporary budgeting method known as 'performance budgeting'. This paper presents the method and its application to the EU budget. It explains why, although not easy to implement, performance budgeting is seen as an attractive way to increase value for money and ...

In 2015, the European Commission launched an initiative entitled 'The EU budget focused on results'. It is aimed at changing spending culture and making results a horizontal priority for the EU budget. The initiative is based on a popular contemporary budgeting method known as 'performance budgeting'. This paper presents the method and its application to the EU budget. It explains why, although not easy to implement, performance budgeting is seen as an attractive way to increase value for money and enhance the transparency and democratic accountability of public finances. The paper also analyses how the performance budgeting approach has evolved within the EU budgetary system and what challenges and obstacles to its implementation remain. The commitment of the European Commission to the principles of performance budgeting, as well as the broad support for the idea expressed by the European Parliament and the Council, give grounds to believe that these efforts will continue in the post-2020 Multiannual Financial Framework.

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.

Post-2020 Multiannual Financial Framework

06-03-2018

In May 2018, the European Commission is expected to adopt a proposal on a new Multiannual Financial Framework (MFF) for the period after 2020, alongside proposals on the reform of the 'own resources' system. Parliament's Committee on Budgets (BUDG) has adopted an own-initiative report on its position on the future MFF, together with one on reform of 'own resources'. Due to be debated during the March plenary session, the two texts will set out Parliament’s perspective on both the revenue and expenditure ...

In May 2018, the European Commission is expected to adopt a proposal on a new Multiannual Financial Framework (MFF) for the period after 2020, alongside proposals on the reform of the 'own resources' system. Parliament's Committee on Budgets (BUDG) has adopted an own-initiative report on its position on the future MFF, together with one on reform of 'own resources'. Due to be debated during the March plenary session, the two texts will set out Parliament’s perspective on both the revenue and expenditure sides of the EU budget, which it argues should be treated as a single package in the upcoming negotiations.

Post-2020 MFF and own resources: Ahead of the Commission's proposal

27-04-2018

On 2 May, the Commission is expected to publish proposals for a new multiannual financial framework (MFF) for the European Union for the years after 2020, as well as for a new system of own resources (OR) to provide the EU with the means to finance its annual budgets. The following day the proposals are to be presented to the Parliament's Committee on Budgets (BUDG).The proposals are being published as a package, and will be followed by a series of further legislative proposals for individual spending ...

On 2 May, the Commission is expected to publish proposals for a new multiannual financial framework (MFF) for the European Union for the years after 2020, as well as for a new system of own resources (OR) to provide the EU with the means to finance its annual budgets. The following day the proposals are to be presented to the Parliament's Committee on Budgets (BUDG).The proposals are being published as a package, and will be followed by a series of further legislative proposals for individual spending programmes to appear later in May and in June. The next MFF and OR system will set the EU's priorities and determine much of its scope for action for a period of at least five years. The proposals are an opportunity for the Commission to respond to a set of longstanding issues concerning how the EU finances its priorities, and to new issues arising from a political landscape that has changed profoundly since 2013, when the EU last negotiated its multiannual budget plan. Chief among these are the twin pressures affecting both the revenue and spending sides of the budget: the loss of a major net contributor country in the departure from the EU of the United Kingdom; and growing pressure to respond to new challenges mainly linked to the refugee and migration crisis that erupted after the current MFF was put in place, as well as ongoing issues resulting from the financial and sovereign debt crises. The Commission's proposals for a new MFF and OR will also respond to the question of how big the EU budget should be. Currently subject to a political cap of 1 % of the EU's GNI, the EU budget is modest in comparison with the government budgets of the EU's Member States. Nevertheless, negotiations over whether to increase this cap will be politically fraught in a context where some Member States are under pressure to reduce national budget deficits. Other issues at stake in the negotiations are the flexibility, conditionalities, structure and duration of the next MFF, and the sensitive question of whether to increase the EU's financial autonomy by endowing it with new and significant own resources.

European Maritime and Fisheries Fund

15-06-2017

The €6 396.6 million European Maritime and Fisheries Fund (EMFF) is the smallest of the European Structural and Investment Funds for the 2014-2020 period, but it is the major financial tool supporting the EU common fisheries policy (CFP). Slightly less than half of the Fund is dedicated to promoting sustainable fisheries and to fostering sustainable aquaculture. Another significant share contributes to proper implementation of the CFP, particularly for data collection and science-based needs, and ...

The €6 396.6 million European Maritime and Fisheries Fund (EMFF) is the smallest of the European Structural and Investment Funds for the 2014-2020 period, but it is the major financial tool supporting the EU common fisheries policy (CFP). Slightly less than half of the Fund is dedicated to promoting sustainable fisheries and to fostering sustainable aquaculture. Another significant share contributes to proper implementation of the CFP, particularly for data collection and science-based needs, and control and enforcement of rules. A small part of the EMFF is also aimed at supporting an integrated maritime policy (IMP) for the EU.

Payments backlog in recent EU budgets: Lessons learnt and outlook

10-11-2015

Since 2011, the EU has experienced an issue of increasing levels of payment backlog at year-end. The problem has turned out to be a recurring one, especially pressing during annual budget negotiations, and difficult to resolve with ad-hoc preventive action. The situation has deteriorated over the years and at the end of 2014 the payment backlog was estimated at some €26 billion, around half of which was classified by the European Commission as 'abnormal'. While the bulk of the backlog came under ...

Since 2011, the EU has experienced an issue of increasing levels of payment backlog at year-end. The problem has turned out to be a recurring one, especially pressing during annual budget negotiations, and difficult to resolve with ad-hoc preventive action. The situation has deteriorated over the years and at the end of 2014 the payment backlog was estimated at some €26 billion, around half of which was classified by the European Commission as 'abnormal'. While the bulk of the backlog came under the heading 1b 'Cohesion for growth and jobs', other policy areas were also affected, such as the Erasmus and research programmes, the European Neighbourhood Instrument and humanitarian aid. The problem interlocks both technical aspects of budgetary management and a political dimension, with fundamental questions on the architecture of EU public finances, including the system of own resources and the flexibility of the Multiannual Financial Framework. The situation should significantly improve by the end of 2016 thanks to a series of interinstitutional initiatives, strongly supported by the EP. However, the future outlook from 2017 remains to be thoroughly assessed.

Upcoming events

28-01-2020
Western Balkans: A rocky road to enlargement
Other event -
EPRS
29-01-2020
Where all students can succeed: Analysing the latest OECD PISA results
Other event -
EPRS
29-01-2020
The Future of Artificial Intelligence for Europe
Workshop -
STOA

Partners

Stay connected

email update imageEmail updates system

You can follow anyone or anything linked to the Parliament using the email updates system, which sends updates directly to your mailbox. This includes the latest news about MEPs, committees, the news services or the Think Tank.

You can access the system from any page on the Parliament website. To sign up and receive notifications on Think Tank, simply submit your email address, select the subject you are interested in, indicate how often you want to be informed (daily, weekly or monthly) and confirm the registration by clicking on the link that will be emailed to you.

RSS imageRSS feeds

Follow all news and updates from the European Parliament website by making use of our RSS feed.

Please click on the link below to configure your RSS feed.