BUDGET: COUNCIL TIGHTENS RULES FOR EU EMERGENCY RELIEF FUND.

EU Foreign Ministers have raised the threshold for using a new emergency relief fund to be used to provide rapid financial aid in case of natural disasters like the recent floods in Central and Eastern Europe. At the General Affairs and External Relations Council in Brussels on September 30, Ministers increased the level of damage which must have been caused by a catastrophe before the Solidarity Fund could be triggered to three times what the European Commission had originally suggested.

The Council raised the threshold from Euro one billion proposed by the executive in September to three billion or from 0.5 to 0.6% of a country's GDP. Commission sources said the changes were made at the insistence of Member States that are net contributors to the EU Budget and are concerned at the amounts being made available by the fund and want to ensure strict criteria for spending the money. Germany, the largest net contributor, is in favour of the fund and German Chancellor Gerhard Schroder was one of the originators of the idea after his country was hit by floods at the end of August which caused ten of billions of Euro of damage.

Ministers also insisted that the fund could only be used for natural disasters as Member States believe that "technological" accidents like the explosion at the AZF chemical...

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