European Parliament, Council move closer on 2007 budget

Twelve hours of negotiations between the European Parliament and the European Council in Brussels yesterday failed to lead to an agreement over next year's EU budget.

The EU is currently in the process of approving its budget estimates for 2007, however this first needs the consent of both the European Parliament and member states.

Labour MEP Louis Grech, who is involved in the negotiations, told The Times following a conciliation meeting between the two sides that despite disagreement on a number of issues he is still confident that a compromise will be found by the end of next week.

"At one time during the negotiations it seemed that the reconciliation process would finish up in deadlock. However, after hours of further discussion, the Council agreed with most of the positions taken by Parliament and now it seems that we will have a conditional agreement which should be cleared in the coming few days. This will prepare the way for Parliament's second reading which should take place on December 14."

The main outstanding issues concern the overall amount of spending, with the European Parliament delegation insisting on an increase of €1.2 billion over the original €114.3 billion already agreed by member states; funds to be spent on the recruitment of new staff, particularly from the new member states; and the budget to be dedicated to the EU's Common Foreign and Security Policy.

Sources close to the negotiations told The Times that by the end of yesterday's discussions it seemed that original moves by the Finnish presidency to cut jobs and freeze recruitment at the European Commission have been withdrawn as many member states did not agree with the Finnish stance.

However, serious divergences remain as the European Parliament is pushing member states to consult with it before deciding to launch expensive Common Foreign and Security Policy (CFSP) missions such as the upcoming EU Kosovo peacekeeping mission, with MEPs still threatening to cut 2007's €170 million CFSP spending in half if they don't get their way.

The final 2007 spending plan must be agreed on by MEPs and budget talks will continue on November 28 ahead of the parliamentary second reading in mid-December.

Nationalist MEP Simon Busuttil was also present during the negotiations while Parliamentary Secretary Tonio Fenech and Ambassador Richard Cachia Caruana represented Malta on the EU Council.