ECONOMIC CRISIS : INSTITUTIONS AT LOGGERHEADS OVER FUNDING FOR MICROFINANCE FACILITY.

The European Parliament gave its overwhelming consent, on 15 December in Strasbourg, to a report by Hungarian MEP Kinga Goncz (S&D) to amend the European Commission's proposal for a microfinance facility for employment and social inclusion. The EP says that the money (100 million over four years) should not come from the Progress' fund (an EU fund set up to protect the most vulnerable groups in society) as proposed by the Commission and backed by the Council. Rapporteur Goncz already tried earlier this year to increase the amount of money (from 100 million to 150 million) to be allocated to the microfinance facility, but her proposal was rejected during informal negotiations with the Commission and the Council, and so she decided to delete that from the report.

However, to ensure that the facility can be launched in early 2010, the Parliament agreed, with the adoption of the report, to release 25 million from the margins of the EU's 2010 budget, which will be put to a vote during the plenary session, on 18 December. Despite informal talks, the Parliament and the Council have not reached agreement yet on the facility's financing beyond 2010.

MEPs want funding decisions to be taken each year, when the EU budget for the following year is being drawn up, so as to avoid having to reallocate funds from the Progress programme as per the Commission and Council's plans. According to Swedish sources, the member states would prefer to draw on money "not being used" rather than having to come up with fresh funding.

CRISIS TOOL

The microfinance facility for the years...