Attachment 1
UK FINANCIAL CONTRIBUTIONS TO EC DEVELOPMENT
PROGRAMMES
The UK and other member states provide the bulk
of EC development assistance in two distinct ways:
— Budgetary contributions
— Voluntary contributions to the European
Development Fund (EDF)
BUDGETARY CONTRIBUTIONS
The EC's external programmes are, with the exception
of those for African, Caribbean and Pacific states, funded from
the EC budget. Each member state's share is based on a formula
that takes account of GDP and customs receipts. Our current share
is approximately 19 per cent[14].
With a few exceptions for particular programmes, DFID is responsible
for the UK's contributions to the external relations and pre-accession
chapters of the budget (known respectively as Categories 4 and
7 of the budget). This accounts at present for just under £700m
of DFID's budget. Each year the Treasury withholds the UK's estimated
budgetary contribution to the EC on development from DFID's vote.
Adjustments are made in following years when the final outturn
is known.
VOLUNTARY CONTRIBUTIONS
TO THE
EDF
The European Development Fund was established
as the financial instrument for the series of agreements signed
between the EC and African, Caribbean and Pacific states (the
Lomé Conventions and, since June 2000, the Cotonou Agreement).
It is a voluntary fund which all member states contribute to and
which is managed by the Commission. The EDF is replenished every
five years. The size of the replenishment and each member state's
share are negotiated afresh on each occasion. For the past two
replenishments (EDF 8 and EDF 9), the UK share has been 12.7 per
cent. This is paid on a quarterly basis from DFID's accounts.
The estimated UK share of EDF expenditure this financial year
is £91m. This has reduced from over £200 million two
years ago due largely to the opportunity to clear a backlog of
unspent resources previously called down from member states.
14 The abatement to UK budget contributions to take
account of our relatively lower receipts from the CAP does not
apply to the external relations part of the budget. Back
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