European Scrutiny Committee Contents

17 EU Budget 2010



COM (10) 315

Draft amending budget No 6 to the general budget 2010: Statement of revenue and expenditure by section: Section II — European Council and Council, Section III — Commission, Section X — European External Action Service

Legal baseArticle 314 TFEU; co-decision; QMV
Document originated17 June 2010
Deposited in Parliament22 June 2010
DepartmentHM Treasury
Basis of considerationEM of 13 July 2010
Previous Committee ReportNone
To be discussed in CouncilNot known
Committee's assessmentPolitically important
Committee's decisionNot cleared, further information requested


17.1 During the course of a financial year the Commission presents a number of draft amending budgets (DAB) to change specific aspects of the current EU general budget. These DABs normally propose relatively minor changes to the budget, are usually uncontroversial and are often budget neutral.

17.2 In April 2010 the previous Committee considered a draft Council Decision to establish a European External Action Service (EEAS) to support the High Representative for Foreign Affairs and Security Policy, as provided for in the Lisbon Treaty. The personnel of the EEAS were to be drawn from the Commission, from the General Secretariat of the Council and from Member States' diplomatic services. Our predecessors also considered draft Regulations to amend, as a consequence of establishing the EEAS, the Staff Regulations, which govern the conditions of employment of servants of the EU, and the Financial Regulation, which governs management of the EU general budget. These three proposals, which are still being negotiated, were cleared from scrutiny after a debate on the Floor of the House.[69]

The document

17.3 This DAB proposes an increase to the 2010 EU general budget of €9.5 million (£8.1 million) to fund additional costs arising this year from the establishment of the EEAS. The Commission's proposal is based on the High Representative's draft Council Decision to establish the EEAS. Recalling that the EEAS is to be guided by the principles of cost efficiency, budget neutrality and sound and efficient management, the Commission says that:

  • transitional arrangements and a gradual build-up of capacity will be used in establishing the EEAS;
  • unnecessary duplication of tasks, functions and resources with other structures must be avoided and rationalisation and streamlining of existing systems should be used to the maximum;
  • this is particularly important in view of the EU-wide efforts for fiscal consolidation and constraints on public finances;
  • it is expected that one third of EEAS staff will be composed of representatives from Member States by 2013;
  • in the first year of operation, 2010, it is envisaged that the EEAS will comprise posts transferred from the Commission and the General Secretariat of the Council, with some additional posts filled by Member States' diplomats;
  • there are 20 such new posts foreseen at AD (administrator) level for the EEAS headquarters in Brussels, for additional tasks of acting as the Presidency of Working Groups and Committees that prepare the Foreign Affairs Council, posts for the EEAS corporate and policy boards and for creation of a small legal unit;
  • these will be supplemented by an additional ten support staff;
  • in the last quarter of 2010 there is also envisaged an additional 80 AD posts in EU delegations around the world, including to reflect the fact that, since 1 January 2010, 60 EU delegations have taken on a range of tasks of the local Presidency in relation to the Common Foreign and Security Policy;
  • of the 80 new posts 40 will be deployed in delegations where there is currently no political officer, will support delegations to multilateral organisations and 20 posts will be in upgraded regionalised delegations and new Deputy Head of Delegation slots; and
  • these new posts will be supplemented by an additional 60 locally-recruited support staff.

17.4 Due to the complexity of creating the EEAS in-year as a new institution, with its own budget within the EU general budget, and transferring over to it significant appropriations related to staff and contracts from the Commission and the General Secretariat of the Council, the Commission proposes a special transitional arrangement for the budgeting process for 2010:

  • a section will be created in the EU budget for the EEAS;
  • the posts due to be transferred from the existing two institutions to the EEAS will continue to remain in those institutions' establishment plans until the end of 2010, although will be clearly identified within those plans; and
  • additional appropriations needed for new EEAS staff will appear against the appropriate budget lines of the Commission and General Secretariat of the Council budgets until the end of the year.

It is envisaged that the EEAS will have its own full budget for 2011.

17.5 The Commission notes that the establishment plan of the EEAS in 2010 will consist of:

  • 1,114 posts transferred from the Commission, made up of 675 in headquarters and 439 in delegations;
  • 411 posts transferred from the General Secretariat of the Council, made up of 387 in headquarters and 24 in delegations; and
  • 100 new posts for Member States' diplomats, made up of 20 in headquarters and 80 in delegations.

The Government's view

17.6 The Economic Secretary to the Treasury (Justine Greening) says that:

  • the Government wants to ensure both that the EEAS is useful to the Member States and respects the role of national diplomatic services;
  • to be effective, and to increase nation states' ability to project themselves in the world, it is right that the EEAS is given adequate resources to begin working as soon as possible; and
  • the Government considers that the arrangements the Commission proposes to ensure continuity of budgeting, in the technical sense, this year are well-advised.

17.7 The Minister continues that, in terms of the justification given for the additional costs, the Government:

  • welcomes the efforts made to incorporate staff from all three institutional sources from the start of the EEAS's existence; and
  • will be pushing for further details about the additional posts proposed and about their functions and distribution around the world and for evidence that cost efficiencies and streamlining of existing systems have been rigorously pursued.

She notes as relevant to this a reference in the recitals in the latest text of the draft Council Decision to establish the EEAS:

"8 (bis) the establishment of the EEAS should be guided by the principle of cost-efficiency aiming towards budget neutrality. To this end, transitional arrangements and gradual build-up of capacity will have to be used. Unnecessary duplication of tasks, functions and resources with other structures should be avoided. All opportunities for rationalisation should be used."

17.8 On the financial implications of the DAB for the UK the Minister, noting that it proposes an additional €9,521,362 (£8,079,828) in both commitment and payment appropriations this year, says that:

  • this will increase the overall level of the EU budget and will therefore require increased contributions from Member States;
  • the UK's GNI share of EU budget financing in 2010 is currently estimated at 13.8%; and
  • the pre-abatement cost to the UK of the proposal in 2010 would be roughly €1,313,948 (£1,115,016).


17.9 We note that this budgetary adjustment is a necessary consequence of establishing the European External Action Service and that the Government is content with the proposal from a technical point of view. However before we consider the matter further we should like to hear about the further details the Government is seeking on the additional posts proposed and about evidence of a rigorous pursuit of cost efficiencies and streamlining of existing systems. Meanwhile the document remains under scrutiny.

69   (31439) 8029/10, (31445) -, (31446) 8134/10 + ADD 1: see HC 5-xvii (2009-10), chapters 1 and 2 (7 April 2010) and HC Deb, 14 July 2010, cols. 1034-1060. Back

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