1982 BUDGET PROCEDURE: SECOND READING IN THE EUROPEAN PARLIAMENT
by Altiero Spinelli
SUMMARY: With the second reading, the European Parliament concludes the procedure for preparation of the 1982 budget.
Since the question of increased own resources and reform of the agricultural policy remains unresolved, Spinelli proceeds with his dispute with the Council on the question - which is extremely delicate as far as the Parliamentary authorities are concerned - of the classification of budget expenditure, which since 1975 has been divided into compulsory expenditure (on which the Council has the last word) and non-compulsory expenditure (on which the Parliament has the final vote).
The Council purported, by a unilateral decision, to determine how expenditure was to be classified, but since the final decision belongs to the Parliament and in particular to the President thereof who "declares the budget adopted" on conclusion of the procedure, Spinelli obtains a clear vote from the Parliament against the arrogance of the Council, confirming the distinction between compulsory and non-compulsory expenditure, in accordance with legal and political logic.
This marks the start of a new phase in the dispute between Governments and the Parliament which is to continue until 30 June 1982 with the approval of an ambiguos Council-Parliament-Commission agreement, the result of a deplorable move towards compromise by the Committee on Budgets, which was very soon to be infringed by the Council and the Commission with respect to its extremely limited positive aspects. In "Speeches in European Parliament, 1976-1986", Pier Virgilio Dastoli editor. (EP, 15 December 1981)
Mr President, it is my privilege to present to you the recommendations of the Committee on Budgets following its examination of the draft general budget as modified by the Council.
Our committee has formally noted and invites Parliament to take formal note that the Council, acting entirely within its powers, has fixed in the final instance the amount of expenditure that Parliament, Council and Commission regard as compulsory. The amount involved was 13300 million ECU, or 61.25% of the overall draft budget. Apart from a reduction of 33 million ECU, the Council has in actual fact confirmed the sums proposed by the Commission in its Ma@ preliminary draft budget.
The Council's preoccupation with budgetary restraint, which has been so clearly evident in its approach to expenditure in other chapters, might have persuaded it that, since May, there has been every indication of a significant decline in agricultural guarantee expenditure in 1982. The Commission must have informed it to that effect. However, that is how the Council has decided and we, anxious to abide strictly by Community law, have to submit to that decision. The Council also thought it could fix in the final instance those items of expenditure that it alone regards as compulsory: expenditure on fisheries, EAGGF Guidance, interest rebates, supplementary measures for the United Kingdom, loans, foods aid, and also the reserve contained in Chapter 100, which includes appropriations the purpose of which is by definition undecided and discretionary, in complete contrast to compulsory expenditure as defined by Article 203 of the Treaty of Rome.
The Council knew very well that Parliament would never accept any limitation of its own powers and responsibilities by any unilateral and arbitrary decision of the Council, not of Council and Commission together. The Council has always acknowledged, by the very manner in which it has always expressed itself, that it does not have the right to act unilaterally on this classification. And yet, despite urgent and repeated initiatives since 1977, it has always flatly refused to give any explanation whatsoever of its conception of the classification of expenditure.
Several resolutions on the budget, passed in the course of this year, a formal letter from our President dated 8 October, the unambiguous and carefully reasoned statements by our President and the Parliament delegation she headed, made in the context of the budgetary conciliation meeting of 24 November, were in effect invitations to the Council to draw up jointly with us and the Commission a classification of expenditure acceptable to all three institutions. The Council has on several occasions been advised by us in very clear and precise terms that we were even prepared to consider a provisional agreement just for this year. Let us not prejudice our future positions, but let us have an agreement, not a diktat. We have warned the Council that in the absence of such an agreement we could only accept as compulsory expenditure those items indicated as such in the three classifications of our three institutions.
The Council initially responded with silence, then by attempting to arrange discussions with its subordinate bodies, later still by informal exchanges of views over one or two good meals, and finally, during our last conciliation meeting, by a curt refusal to engage in any search for an agreement for the 1982 budget and by the promise, which is non-committal, of joining with us next year in searching for a solution for the 1983 budget. Meanwhile they invite us to stick to its classification until such a time as another one has been agreed.
Mr President, Members of Parliament, I have to weigh my words carefully, but the only word to describe the Council's attitude in assuming the right unilaterally to define, as it sees fit, powers that the fundamental laws of our Community give to us is 'arrogance'...
Having tried everything to persuade the Council to come to an agreement with our committee, I call upon you solemnly to proclaim, by voting for the resolution which I put before you on behalf of the Committee on Budgets, that our classification is the right and proper one and that, in the absence of any indication in our fundamental laws, the boundaries between the budgetary powers of the three institutions can only be determined with the free consent of the three institutions. Now, the classification of compulsory expenditure is the only way we have of influencing the shape of the budget through amendments and modifications and of determining the maximum rate. It is, in short, the only margin of manoeuvre that Parliament has.
If, after your vote next Thursday, the total amount of non-compulsory expenditure, resulting from those items common to the three classifications, does not exceed the margin, then our President will have to conclude that our budgetary procedure has been completed and that the budget is adopted. By your vote on Thursday you will show and you will decide whether this Parliament is the living nucleus of the future true Parliament of the peoples of Europe or whether it is simply a talking-shop whose decisions are of no consequence.
Having thus placed the expenditure in its proper context, it became apparent to us that, despite the moderation shown by Parliament at the first reading, the Council has maintained at its second reading a highly restrictive attitude, which has incidentally resulted in three countries voting against the final draft. All we can do at our second reading is simply reinstate, in whole or in part, the amendments turned down by the Council. Our proposed increase in expenditure is but an insignificant proportion of national expenditure, that is to say 0.009%, or one ten-thousandth, of national expenditure, which rather makes nonsense of all this interminable talk of budgetary stringency. This reinstatement seems to us in any case necessary to achieve a more balanced budget, which is something that the Commission and the Council also claim to set such great store by.
In order to carry out this operation successfully, our committee proposes to keep Parliament within the margin, which will enable it to decide in the final instance and, even though we are saying here that the maximum rate and the margin, according to Article 203, are applicable only to expenditure, we recommend leaving this whole question to be settled at some later date and on this occasion remaining within our margin for both commitment appropriations and payment appropriations.
Our committee has accordingly drawn up a whole series of amendments with a view to reinstating 350.4 million ECU in payments and 371.8 million ECU in commitments. The total in commitment appropriations almost exhausts our margin and we do not want to exceed it, so in other words, by virtue of the relationship that exists between commitments and payments, the latter can use up no more than 78% of our margin.
The Committee on Budgets has had to make some difficult choices and several of the rapporteurs from the specialist committees have been none too satisfied with the outcome. I am not entirely happy with it either but I urge you nevertheless to follow our committee's recommendations and, if you do depart from them, at all events to remain within the margin; for if we go outside it we shall by our own law be held to a co-decision with the Council on the new maximum rate and we shall then be at the mercy of the Council and forced to accept whatever hand-outs it may condescend to give us. If, on the other hand, we stay within our margin, then within four days we shall be able to present the Community with a budget, totally inadequate perhaps, but one which will show nevertheless that we have the will to follow through with certain priorities in the sphere of social, regional and cooperation policy, which will keep borrowing and lending policy under Parliament's control and will show above all that this Parliament
observes the laws of the Community and demands therefore that its decisions be respected.
Mr President, I cannot conceal my surprise at the fact that Commissioner Tugendhat noted with regret that this debate was lacking in enthusiasm. Perhaps Commissioner Tugendhat has forgotten that it was he who first gave a negative judgment on the draft budget prepared by the Council, going so far as to say that the Commission disassociated itself from it. Given the fact that, substantially, this budget does not differ greatly from the one presented on the first reading, Commissioner Tugendhat will understand why Parliament cannot feel much enthusiasm for it, despite the Commissioner's own conversion.
I was particularly surprised by the fervour with which the Commissioner defended the Council's draft budget. I agree about the 'trialogue' (even though as a former Greek scholar I cannot but observe that the expression 'trialogue' is incorrect, since the adverbial prefix 'dia' does not mean 'two', but rather 'exchange', 'through', and that therefore it would be correct to say 'three-sided dialogue', and not 'trialogue') on condition, however, that in this three-sided dialogue each member will play his own role, with the Commission not assuming that of the Council!
The Commissioner has told us that it is necessary to pursue this or that policy in addition to the one proposed by the Council, but at the same time he pointed out that Chapter 100 can in no way be considered as non-compulsory expenditure. I believe that if we accept this idea, it will be impossible to do anything at all.
I think we must give some thought to what is awaiting us. On Thursday we must vote on a serics of amendments. judging from the discussions we have had, I think that we will be moving in a range of between 3 5 0 million ECU - a figure supported by the Committee on Budgets and by some groups, for expenditures and relative commitments - and a lower figure of 150-200 million ECU as proposed by other groups. I hope that in Thursday's voting we will come near to the 350 million maximum, but the result will be decided at the ballot box, and we will support it.
If the President of the Council could tell us, on behalf of the Council itself and with its authorization, what is the precise figure above that indicated in the draft budget, we could decide whether this figure can be judged acceptable. If it is acceptable, the problem would be solved, for we will respect margins that we ourselves have decided upon; the Council, for its part, should indicate the maximum rate of increase. If the President were unable to furnish us with the maximum rate of increase the Council will accept, then there is no possibility of agreement, and I do not see what would be left to discuss. In fact, it is inadmissible that the President of the Council should not be able to clear up the question of the classification of expenditure, to tell us the figure at which this institution may attain, and that we should be obliged to vote on Thursday only on the opinions referred to us by the President of the Council.
As I have already said, the voting will turn on the data represented by the range I mentioned above, and in any case it will represent - at least according to the Council's official position - more than Parliament is qualified to undertake. At this point we should declare the budget procedure completed, and there would be nothing else to do. The President will obliged to establish that the procedure has been terminated and declare the definitive adoption of the budget. If the President of our institution, contrary to what she herself said not many days ago, were not to declare the procedure at an end, this would mean that we have remained within the margin assigned to us, since this would be the only reason which would justify the continuance of the procedure.
At this point, ladies and gentlemen, Parliament itself will have ceased to exist as budget authority. We would initiate a never-ending 'three-sided dialogue' with the Council and the Commission: never-ending because we will be obliged to accept the usual definitions currently in use.
It could be objected: what foolishness is this in regard to the compulsory or non-compulsory nature of Chapter 100? Do you want to change everything? Believe me, this is no foolishness; it has not been invented either by Mr Spinelli, the rapporteur, or by the Committee on Budgets, which has for years been explaining the reasons why the classification it proposes is to be preferred. But that is not all: a practice has long existed which consists in the transfer of funds belonging to compulsory expenditure to Chapter 100 and vice versa. When we - rightly or wrongly - transferred certain sums from compulsory expenditure to Chapter 100, we followed the procedure of the proposed modifications and not that of the draft amendments. This demonstrates that it is not possible to transfer everything to Chapter 100. In fact, with the proposed modifications the last word belongs not to Parliament but to the Council, and this is inadmissible.
The procedure of the 'transfer' of a compulsory expenditure to Chapter 100 has always been that of a proposed modification, while for transfers from Chapter 100 the 'technique' of the draft amendments has always been used, without this procedure ever having been contested in any way.
For this reason, the matter is not as simple or as foolish as the gentlemen of the Council or the Commission may assert.
Furthermore, without wishing to say that our view is the correct one, I would like to make clear that we do not accept orders of any sort on this subject from the Commission or the Council. We have urged that an agreement be reached among the three institutions, and we have said that until this has been accomplished the only thing we can accept is what is included in all three of the existing lists. If we say that it is necessary to keep to Chapter 100, it is not because we do not intend to negotiate on this article. It is the Council which refuses to negotiate. We - I repeat - are ready for discussion, but we cannot accept a diktat.
For these reasons I think it would be well to think about the position we will take on Thursday: we as an assembly, and President Veil as president of our Parliament. At stake are the real powers of Parliament in the area of the budget.
Although the sum itself is quite insignificant, the Council should be able to indicate to us before Thursday something more than only 60 million or a few career improvements. The Council wishes in fact to ascertain up to what point this Parliament has been tamed. It will be up to us, therefore, to show that this Parliament is still a clever, strong, and not yet domesticated animal.
