32 Financing the common costs of EU military
or defence operations
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| Draft Council Decision establishing a mechanism for the financing of the common costs of European Union operations having military or defence implications
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| Legal base | Article 28(3) EU; unanimity
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| Department | Foreign and Commonwealth Office
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| Basis of consideration | Minister's letter of 22 January 2004
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| Previous Committee Report | HC 42-iii (2003-04), para 13 (17 December 2003)
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| To be discussed in Council | No date set but probably January 2004
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| Committee's assessment | Politically important
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| Committee's decision | Cleared
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Background
32.1 On 17 June 2002 the General Affairs and External Relations
Council (GAERC) agreed that under any future ESDP military operation,
most costs would be funded on a costs-lie-where-they-fall basis,
that is by the contributing Member State. However, a limited
number of costs, which could not properly be allocated to one
Member State, should be funded as "common costs" from
the general EU budget and be divided between Member States on
a GNP-related basis. These costs are primarily incremental costs
for deployable or fixed headquarters for an EU-led operation.
32.2 The Council decided in September 2003 that a
"mechanism", that is, a fund, should be set up by 1
March 2004 to finance the common operational costs of an EU-led
military mission in the majority of cases. For urgent, short-term
missions, post-operation settlement could be more appropriate.
When we considered this proposal on 17 December 2003, we cleared
the document but asked the Minister to provide us with more detail
than was given in the unofficial text of the document on how the
costs incurred by recourse to NATO equipment, infrastructure and
collective capabilities, that is for operations conducted under
the "Berlin Plus" arrangements, would be determined.
We also asked him whether he had any particular operations in
mind, when he referred to new operations that could be planned
for next year.
The Minister's letter
32.3 The Minister replies that the funding arrangements
agreed in March 2003 specify that:
"the EU would reimburse NATO for the incremental
costs of using its collective assets and capabilities, that is
the additional expenditure incurred solely as a consequence of
using the assets for an EU-led operation. This would cover 'wear
and tear' but not any contribution towards the original purchase
costs. These costs would be collated by NATO budgetary staff
and a claim submitted to the EU. The actual costs charged to
the EU would then have to be approved by unanimity by the Special
Committee (the body which oversees financial matters for a specific
ESDP operation and on which all member states sit) before payment
is made to NATO."
32.4 With regard to new operations, the Minister
says:
"The major operational project for ESDP in 2004
will be the proposed take-over by the EU of the stabilisation
role in Bosnia, performed by NATO since the 1995 Dayton Agreement.
As your Committee may recall, the European Union indicated its
willingness to take on this role at the Copenhagen European Council
in December 2002. NATO Foreign Ministers agreed in December 2003
that the Alliance should start work with the EU on planning the
possible transition to an EU mission under Berlin Plus. The Brussels
European Council on 12-13 December endorsed this. Although it
is too early to say the exact scale and scope of the mission,
we expect it to launch in at the end of 2004. I will, of course,
try to ensure that the relevant documents are submitted to your
Committee for scrutiny in good time."
Conclusion
32.5 We thank the Minister for this additional
information and for undertaking to try to ensure that the relevant
documents are submitted to us in good time. As the operation
is being planned well ahead, we hope that he will impress upon
the relevant bodies the need to allow sufficient time for scrutiny.
32.6 We now clear the document.
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