BUDGET: BARROSO CALLS ON MEPS TO BACK HIM OVER 2007-13 FINANCING.

Barroso was addressing a meeting of the EPs otemporary committee on policy challenges and budgetary means of the enlarged Union 2007-13o. He started by welcoming the draft report by Boge, highlighting the fact that the report calls for overall spending at a level close to the Commissions proposal. (1.09% of EU Gross National Income in payment terms compared to the Commissions request for 1.14%). He also welcomed the EPs support for the greater flexibility the Commission was seeking as part of its proposal. He said flexibility was useful because it reduced the temptation to spend up to a ceiling to ensure funds were used. oWhen resources are tight we must make sure that they are not impossible to useo, he told MEPs.

He repeated a warning made recently by EU Budget Commissioner Dalia Grybauskaite that if there was no agreement in June there was a risk that some major policies would not be in place by January 1, 2007 and that it could lead to ouncertaintyo in the European economy. He stressed that as part of a final deal the question of the British rebate and the issue of excessive net contributions must be resolved.

Barroso also warned that limiting spending to 1% of GNI, as advocated by the group of six net contributors, did not simply mean reducing the Commissions proposal but meant ocutting current expenditureo especially in view of the fact that Bulgaria and Romania are due to join in 2007. However, Boges draft report calls for farm support for Romania and Bulgaria to come from within the 2002 deal on financing of the Common Agricultural Policy while the Commission proposed an additional euro eight billion for these requirements.

Barroso then faced a series of questions from MEPs on different aspects of the budget, asking him how the Commission planned to ensure that the EPs priorities and desires were taken into account.

No to five year budget period.

Alain Lamassoure (EPP-ED) repeated the argument, made in Boges report, for the budget period to be synchronised with the mandates of the Commission and Parliament. But Barroso said that if the budgeting period and the mandates ran in parallel there would be a oproblem in trying to ensure certainty about timingo. In any case a two-year run-up period was needed to prepare for certain types of expenditure such as on agriculture and the structural funds, he said. The agreement on agricultural spending also ran until 2013, he said.

Call for cofinancing of farm payments.

Barroso also faced a...