In a significant move towards enhancing the European Union’s financial stability and adaptability in the face of global challenges, the European Commission’s recent proposals for adjustments to the next generation of own resources and the multiannual financial framework (MFF) were discussed in the European Parliament on September 20.
Next Generation of Own Resources
The Commission presented an adjusted package on June 20, 2023, focusing on the next generation of own resources. This comprehensive package includes updates to the existing Emission Trading System (ETS) and the Carbon Border Adjustment Mechanism (CBAM) based own resources. Additionally, it introduces a new temporary statistical own resource based on corporate profits (CPOR).
In response to the Commission’s proposal, co-rapporteurs José Manuel Fernandes (EPP) and Valérie Hayer (Renew) have expressed their support. They believe that the proposal aligns with the priorities and demands articulated by the Parliament in its Resolution on Own Resources: “a new start for European Finances, a new start for Europe.”
Furthermore, Fernandes and Hayer have urged the Council to promptly move forward with the adoption of the proposal. They have also advocated for changes in the rebates on Gross National Income (GNI) contributions for certain Member States. Specifically, they propose that these rebates be subject to an automatic annual 2% deflator instead of a GDP deflator. This adjustment aims to prevent excessively high rebates due to elevated inflation rates.
Multiannual Financial Framework Revision
Simultaneously, the Commission introduced a targeted revision of the multiannual financial framework (MFF) for the years 2021-2027 on June 20, 2023. The MFF co-rapporteurs, Jan Olbrycht (EPP) and Margarida Marques (S&D), have praised the Commission’s proposal as a significant step in the right direction. Their report was adopted by a large majority.
Olbrycht and Marques emphasize that the proposal should enable the MFF to better address the challenges posed by Russia’s war of aggression against Ukraine. It should also safeguard the European Union’s strategic autonomy and sovereignty, providing the Union with the necessary flexibility to effectively respond to crises.
As part of their propositions, the co-rapporteurs suggest an increase of an additional EUR 5 billion to the MFF, which would place the European Recovery Instrument (EURI) above and beyond the MFF ceilings and boost the Flexibility Instrument and Solidarity and Emergency Aid Reserve. The interim report is set for consideration in plenary during the October I session of the European Parliament.
Further information can be found here and here.
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