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The European Commission yesterday launched the draft budget for 2012: the principle objectives of which are to fully support the European economy and EU citizens and to bear in mind the current austerity climate throughout Europe. The draft figure for payments amount to €132.7bn, representing a 4.9 percent increase on 2011. Budgetary commitments for the year amount to €147.4bn: a 3.7 percent increase on the 2011 figures.

Changes

Funding has been increased in the case of programmes deemed to be facilitating economic growth and cohesion. For example, the budget for research programmes has increased by 13.3 percent to €7.6bn. In justifying the increase of the EU budget,Budget and Financial Programming Commissioner Janusz Lewandowski noted the case of the electric interconnection between the United Kingdom and Ireland, stating that “the overall EU contribution to this project is over €100 million. Its aim is to give Irish and British citizens greater security of power supply. In 2012, the bills the EU will have to pay for this project will amount to some €24 million, more than twice as much as in 2011”.

Cuts

In order to save money, expenditure on underperforming programmes has been cut in the budget. According to the Commissioner, there is a marked shift “towards programmes or initiatives that deliver concrete results on the ground”. Furthermore, administration and internal costs including training of staff, publications and travel will all feel the wrath of the budget 2012 with only 6 percent of the EU budget going to the functioning of the EU institutions. 94 percent of the annual budget will thus go back to Europe’s regions and towns, business, scientists and citizens, with half of it being geared towards growth and employment.

Increases

Other notable budgetary increases include: €57.7bn is to be paid in 2012 for sustainable growth to help Member States increase their investments in these areas; €62.6bn will be dedicated to the Europe 2020 priorities which marks an increase of 5.1 percent on 2011; there will be a 6.8 percent increase in the area of freedom, security and justice; the EUROPE 2020 initiatives actions for youth will amount to € 1.9bn; and there will be an increase of 6.1% in 2012 in funding towards climate change.

The Council will decide on the budget in June, followed by a decision by the Parliament in October. Should disagreements arise: there will be a 21-day conciliation procedure with the European Commission acting as honest broker. The final 2012 budget is expected to be adopted by the Parliament in November.