Revised 2011 budget plan unveiled

By Constant Brand - 26.11.2010 / 15:39 CET

European Commission hopes proposal will be accepted by member states and MEPs.

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Commission wants 6.8% rise in budget

Payments foreseen of €138 billion for 2013.
MEPs prepare to call for greater budget increase
EU budget complexities pose a public-relations challenge

EU budget complexities pose a public-relations challenge

MEPs prepare to call for greater budget increase

Fact file

Flexibility mechanism

Member states reached an agreement yesterday (25 November) that will turn an informal flexibility mechanism into an EU regulation. The mechanism was part of the 2006 inter-institutional agreement between the Council of Ministers, the European Parliament and the European Commission on how to agree the annual budget.

Member states agreed to set up a “contingency margin” of 0.03% of gross national income, or around €3.4 billion, which can be used as a last resort to fill spending gaps or needs in the EU budget if money cannot be found elsewhere.

Rules on when such a contingency fund can be used have been strengthened. However, member states only have to reach a qualified majority to shift funds around. The flexibility mechanism has been used frequently to fund big-ticket items such as the Galileo satellite navigation project. The Parliament still has to agree to the Council's plan before it can be passed. MEPs have linked the issue to negotiations on the EU's 2011 budget.