THE FUTURE OF THE EC DEVELOPMENT BUDGET
Horizontal Budget Lines
68. The main division of the annual budget is on
a regional basis but there are also separate budget headings,
known as horizontal budget lines, for particular activities such
as drugs control, food aid, humanitarian assistance, gender, and
environment. The European Parliament has the power to vote these
additional budget lines and does so with increasing regularity.
There are now between 60 and 70 budget lines which are attributable
to DFID in addition to the regional allocations.[129]
69. The proliferation of horizontal budget lines
has been a cause for concern to the UK Government and NGOs. Numerous
disparate budget lines are not conducive to a coherent policy
framework, and they make analysis of the budget according to country
or even income group impossible, as has been noted by DFID in
written evidence to this inquiry, "the structure of the budget
does not permit the analysis of planned commitments by country,
or by income group."[130]
Saferworld echoed this concern in their memorandum to this inquiry,
"given the plethora of EC budget lines, each with their own
specific objectives, it is at present extremely difficult to provide
a detailed and comprehensive analysis of EC development aid."[131]
70. The vast and complicated array of different budget
lines not only affects the coherence of the overall external activities
of the EC, but has implications for recipients in terms of the
administrative burden placed upon them. DFID in its recent Institutional
Strategy Paper on the EC said, "Many developing countries
receive assistance under a multiplicity of different budget lines
(and, in the case of ACP countries, also the Lomé Convention,
which is funded outside the EC budget). The complexity of the
current external assistance budget increases administration costs."[132]
71. The recent DAC peer review of EC aid stated that
a "matter for concern is the proliferation of budget lines
and ad hoc regulations. There is a need for the Commission
to propose ways to clean up, rationalise and simplify the aid
management system."[133]
DFID reiterated this concern in written evidence, announcing that
"the Government would ... like to see a rationalisation of
the external assistance budget, in particular to reduce the number
of different budget lines and programmes."[134]
72. Whilst such a streamlining of the EC development
budget is desirable, we would sound a note of caution. It is clear
that one of the reasons behind the acceleration in the number
of development-related ad-hoc budget lines by the European
Parliament is a concern that important aspects of development
are not adequately provided for. They are in effect an alternative
and additional development programme which, whilst complicating,
is also often much-needed. Once a coherent strategy is in place
for the EC's external action expenditure, which takes account
of the developmental concerns of the European Parliament, such
ad-hoc budget lines will prove unnecessary. Until we see such
a strategy, to remove important budget lines would be detrimental
to the variety and comprehensiveness of the EC's aid efforts.
Claire Godfrey of Oxfam pointed out to us in oral evidence that,
"it might be too hasty to start rationalising budget lines
immediately. It is going to have to be a very slow process because
there are some very important budget lines like the gender budget
line, human rights and democracy, where those issues in all sectors
have not been mainstreamed adequately within the main programme."[135]
73. There are, however, some budget lines which would
clearly benefit from more immediate consolidation. For example,
we heard during our visit to Brussels that there are currently
13 different budget lines relating to mine clearance.[136]
Integration of these into one budget line could only be advantageous
to the coherence and efficient management of the EC's demining
work. Mark Lowcock gave examples of five budget lines for humanitarian
aid and nine for human rights.[137]
In the EC's annual budget-setting exercise DFID routinely "tend
to oppose the creation of new budget lines and argue that activities
ought to be funded from existing budget lines." They also
argue "to remove some budget lines which are for programmes
which are very old or very small."[138]
He thought progress in the rationalisation of such budget lines
would be gradual.
74. CARE voiced concerns that the removal of horizontal
budget lines would reduce support for certain specialised developmental
issue and restrict NGO access to EC funding as they were forced
to approach the more bureaucratic regional budget lines.[139]
However, we recommend the rationalisation of horizontal budget
lines within the more comprehensive reform of EC development policy
and its budgetary process. Such reform, outlined previously
in this Report, would meet the points CARE raised.
129 Evidence, p.3 Back
130 Evidence,
p.4 Back
131 Evidence,
p.91 Back
132 DFID
Institutional Strategy Paper on the EC pp.4-5 Back
133 OECD
DAC Development Assistance Review Series No. 30 'European Community',
1998, para 0.29 Back
134 Evidence,
p.5 Back
135 Q196,
see also [Commonwealth local Government Forum] Back
136 Annex
p.xxxviii Back
137
Q256 Back
138
Q256 Back
139 Evidence
p.87 Back
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