Government officials at the highest level this week will embark on a final diplomatic lobbying campaign to try to push further the amount of EU funding Malta will be receiving as a result of the ongoing discussions on the EU's next seven-year budget covering 2007-2013.
Prime Minister Lawrence Gonzi will be in Brussels later this week to take part in the final round of negotiations on the EU budget with his counterparts at a crucial EU summit. However, the curtain over the final round of negotiations will be raised this evening, with a 'conclave' of EU Foreign Ministers in Brussels. Foreign Minister Michael Frendo and Permanent Representative Richard Cachia Caruana will be attending this meeting.
According to EU Council estimates, seen by The Sunday Times, the present Luxembourg Presidency proposals suggest that Malta will be granted between €550 million and €600 million (Lm239-Lm260 million) in aid over the next seven-year period. Nevertheless, these figures are still an estimate, as the final actual figures won't be known before the end of the discussions, when a final deal is struck.
Council sources told The Sunday Times that although in principle Malta should be getting a gross figure of €550-€600 million in aid, it will all depend on the final agreement. If member states decide to restrict their contributions to a lower level than that suggested by the Presidency, Malta's funds, together with those to other members, will also have to be revised downwards.
The sources added that the final amount of funding will also depend on the quantity of funds to be specifically dedicated to the Cohesion and Common Agriculture Policies. Negotiations on these two areas are still ongoing and are considered to be a sticking point between member states. France, the major benificiary of agricultural funds, is declaring that it will not allow any further cuts from agriculture payments, while others, including all the 'new' member states, prefer to boost funds dedicated to structural and cohesion aid.
The issue over the British rebate will also influence the end result.
In its latest proposals, the Luxembourg Presidency is suggesting an average contribution by member states into the EU coffers of between 1.06 and 1.09 per cent of Gross National Income over 2007-13. This proposal is much closer to the demands by the six biggest contributors to the EU (Germany, France, Sweden, Austria, the Netherlands and the UK) to limit the budget to one per cent or about €815 billion annually.
The presidency suggested that savings should come from a reduction of about €40 billion spent on regional aid (cohesion) and other cuts on competitiveness. However, these proposals were opposed by all the new member states, including Malta, arguing that savings should be made from other areas.
Malta will also have to contribute its share to the EU budget. Council sources said that it is too early to calculate what amount of money Malta would need to pay during the coming seven years. However, the sources said that Malta, being of Objective 1 status, will definitely end up paying much less than it will receive.