Council President-in-Office, Wolfgang Ruttenstorfer, came before the House to present a draft Budget for 1999 of Euro 96.5 billion. He said this represented a 6 per cent increase on the figure for last year. Extra cash will go on regional and social spending in line with the 1992 Edinburgh agreement on future financing. Some Euro 40 billion, the same amount as last year, is earmarked for the CAP.
MEPs will give the budget a formal first reading next month. Commissioner Liikanen told MEPs that the British government had withdrawn its legal challenge to EU budgetary spending in certain, mainly social, areas following an agreement between Parliament, Council and the Commission. The case brought by Germany and Britain led to the EU court declaring illegal certain areas of budgetary expenditure approved by Parliament where, it was alleged, there was no legal base.
This led to the Commission freezing the funds, mainly earmarked to helping vulnerable groups such as women and children. An agreement later worked out between the three institutions has enabled the Commission to re-start most of the programmes, albeit within new budgetary limits of Euro 32 million for pilot schemes, and Euro 30 million a year for preparatory actions.