---

Treasury

Answer

Mr. Hood: To ask the Chancellor of the Exchequer what the outcome was of the ECOFIN Council held on 21 October; what the Government's stance was on the issues discussed, including its voting record; and if he will make a statement. [194071] Mr. Gordon Brown: The Council reviewed measures the Netherlands has taken following the Recommendation it issued under the EU's excessive deficit procedure. On the basis of a statement by the Commission, the Council took note that, at present, the action taken by the Dutch authorities in response to the Council's Recommendation of 2 June appears adequate to put an end, by 2005, to the present excessive deficit situation in the Netherlands. The Commission and the Council will continue to monitor the action taken. The Council was briefed by the Commission on last month's fiscal notifications by member states. Six member states--Greece, Germany, Italy, Hungary Slovakia and Cyprus--would record 2004 deficits significantly higher than previously reported. The Commission detailed that Greece's annual fiscal deficits were at least 2 percentage points higher than those stated in its returns every year starting from 2000. The Council looks forward to a detailed report from the Commission in time for the next ECOFIN, on Greece's deficit and debt data back to 1997. Poland highlighted the fact that Eurostat's decision on the accounting treatment of pension funds had added up to 2 percentage points to their deficit. Ministers raised concerns that statistical treatment should not result in perverse incentives to undertake necessary pension reforms and will return to the issue. The Council discussed the potential administrative burden for business of complying with legislation and regulation. The Council supported the development of a common European methodology, based on the recommendations of the EPC, to measure the administrative burden of EU legislation and regulation by, among others setting up pilot projects to determine the technical characteristics of the methodology and its application. The Council adopted Conclusions calling for the Commission to implement an administrative cost assessment for its proposals by 2005. ECOFIN will return to the topic of regulation, in particular the issue of competitiveness testing, later in the year, and regulatory reform will be discussed at 5 November European Council. The Council took note of the presentation by the Commission on: the 2003 annual report on protection of the EU's financial interests in the fight against fraud; a proposal for an anti-fraud action plan for 2004 and 2005; and a proposal for a Regulation on mutual assistance in the protection of the EU's financial interests. The Council was also briefed by the Commission on the conclusion and ratification of the EU's anti-fraud agreement with Switzerland and on a 12-year anti-contraband agreement reached by the Commission and 10 member states with Philip Morris International. The Council held an exchange of views on flexibility arrangements under the budget and the Commission's proposals for the 2007-13 period. The Council concluded that the current levels of flexibility were adequate, and that any changes to the Inter- Institutional Agreement would need to be taken in the context of the next Multi-Annual Financial Framework (2007-13). The Council received a presentation notifications by the Commission on proposals for modifying the EU's system of own resources. Over lunch, Ministers were informed of the outcome of the Eurogroup meeting held on 20 October. They discussed the EU's financial framework for the 2007-13 period and met Mr. James Wolfensohn, President of the World Bank, for a discussion of progress toward the Millennium Development Goals. Jon Cunliffe, Managing Director Macro-economic Policy and International Finance of the Treasury, represented the UK at ECOFIN.

Secondary information

Type

Written question

Reference

194071; 426 c21-2W

Session

2003-04

Subjects

Administration Business Fraud EU action EU budget EU economic policy Greece Protection Pension funds Poland Statistics Netherlands EU Economic and Financial Affairs Council

Link

View this Written question on www.publications.parliament.uk