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On 9 July 2015, the Council's Permanent Representatives Committee agreed its position on the draft 2016 EU budget, on the basis of a compromise text of the Luxembourg presidency.
Council's priorities
The Council backed the funds proposed by the Commission for a number of priority areas. These include the European fund for strategic investments (EFSI) aimed at boosting the economy, measures to manage migration flows,humanitarian aid and Erasmus. The Council's position also reflects the payment plan agreed with the European Parliament in May 2015 to phase out the backlog of outstanding payment claims for the 2007-2013 cohesion programmes.
"I am confident that the Council's position on the 2016 EU draft budget provides appropriate resources to mobilise productive investments, boost growth and employment and responds to the most politically pressing needs such as migratory management. In today's economy it is of paramount importance that citizens get value for their money and that EU resources are used with accuracy and accountability. Therefore I believe that the Council's political agreement strikes the right balance between fiscal consolidation and strategic investments that Europe needs to mitigate the negative effects of the current economic and social situation", said Pierre Gramegna, Luxembourg's minister for finance and President of the Council.
Keeping leeway
Given the multiple challenges that the EU is facing in the current political and economic environment the Council considers it wise to keep sufficient financial leeway. It therefore left adequate margins under the ceilings of the multiannual financial framework (MFF) to allow the EU to react to unforeseen needs. Based on budget execution figures in recent years and laying down realistic absorption capacities for the future the Council believes that €153.27 billion in commitments and €142.12 billion in payments would enable the EU in 2016 to reach its policy objectives. This is €563.6 million in commitments and €1.4 billion in payments less than what the Commission proposed.
High growth rates for external policy, migration and competitiveness
The Council's position provides for a decrease in total commitments of 5.36% and an increase in total payments of 0.59% compared to the 2015 EU budget as amended by amending budgets no 1-5. Commitments of €16.5 billion have been added recently to the 2015 budget to safeguard appropriations which in 2014 remained unused due to the late adoption of certain MFF programmes. Concerning payments, the Council's position offers two digit growth rates for external policy actions (+22.5%) and for measures related to security and citizenship, such as migration (+15.4%). Research and other measures aimed at increasing competitiveness benefit from an increase of 8.6%.
A summary of the draft Council's position is set out in the table below:
| Appropriations by heading | billion € | |
| commitments | payments | |
|
1. Smart and inclusive growth: a) Competitiveness for growth and jobs b) Economic, social and territorial cohesion |
69.6 18.8 50.8 |
65.9 17.1 48.8 |
|
2. Sustainable growth: natural resources: of which market related expenditure and direct payments |
62.9 42.7 |
55.6 42.7 |
| 3. Security and citizenship: | 2.6 | 2.2 |
| 4. Global Europe: | 8.7 | 9.1 |
| 5. Administrative expenditure (for all EU institutions): | 8.9 | 8.9 |
| Special instruments: | 0.5 | 0.4 |
| Total appropriations | 153.3 | 142.1 |
| In % of EU-28 GNI | 1.04 | 0.97 |
Next steps
The Council is expected to formally adopt its position by written procedure at the beginning of September. It will serve as a mandate to the Luxembourg presidency to negotiate the 2016 EU budget with the European Parliament.