Brendan Smith (Cavan-Monaghan, Fianna Fail)
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1. To ask the Tánaiste and Minister for Foreign Affairs and Trade the progress made to date with the EU budget negotiations; if he will outline the way the outcome of those discussions will affect funding for various programmes here; and if he will make a statement on the matter. [30910/13]

Eamon Gilmore (Dún Laoghaire, Labour)
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On 8 February the European Council reached agreement on the European Union's multi-annual financial framework, MFF, for the period 2014 to 2020. Under the Lisbon treaty, the consent of the European Parliament is required before the MFF can be adopted by the Council. As Ireland holds the Presidency, we have had the responsibility of negotiating the text of the MFF regulation and the inter-institutional agreement, IIA, between the Council, the Commission and the Parliament. This task has been a challenging one and the outcome remains critical to our capacity to begin to address the key challenges of creating jobs and growth across the European Union. It is an urgent task.

Since February we have been engaged in intensive consultations. Informal discussions with the Parliament began soon after the February European Council, leading to several rounds of formal trilogues between the Presidency, the Parliament and the Commission. These negotiations were advanced at political level through detailed consultations on 13 May, 28 May, 4 June, 11 June and finally on 18 and 19 June. I led the Presidency negotiating team, while Mr. Alain Lamassoure, MEP, has the lead for the Parliament's team. In each case the negotiators kept their respective institutions apprised of progress. From an early stage in discussions it was clear that four main issues were critical in securing the consent of the European Parliament, namely, flexibility, a mid-term review, own resources and unity of the budget. Throughout the iterative process we worked through our respective positions on each of these core concerns and substantial progress was made.

On 19 June Mr Lamassoure and I concluded negotiations and agreed a core package, comprising the MFF regulation and an inter-institutional agreement. We agreed to recommend the package to our respective institutions and are now in the process of discussing the elements of the package with both the Council and the Parliament. I remain hopeful that it will offer the basis for the final outcome on this important file. I am also optimistic that the process will conclude under the Irish Presidency.

Additional information not given on the floor of the House

An additional but important aspect of concluding the MFF relates to the amending budget for 2013. The linkage between the MFF and the 2013 draft amending budget 2, DAB 2, was established by the Parliament and recognised in the MFF negotiations as a political reality. The issue which is one of significant sensitivity was addressed at a summit meeting of the Presidents of the Parliament, the Commission and the rotating Presidency on 6 May. At the 14 May ECOFIN Council it was agreed that of the requested €11.2 billion, the Council would approve a first tranche of €7.3 billion, subject to agreement on the MFF. This issue will have to be addressed before final adoption of the MFF and I am confident we can find a workable arrangement.

Both the Council and the Parliament are now considering the outcome of the MFF negotiations. That outcome provides extensive flexibility in payment appropriations for the first time, as well as improved arrangements for the special flexibility instruments and a provision for the limited carryover of commitment appropriations. In addition, there will be a meaningful mid-term review, provisions on the unity of the budget and a detailed roadmap for future work on reform of own resources. All of this represents a significant step forward. The agreement of the Parliament and the Council would allow us to move ahead with rapid delivery of the spending programmes citizens need and expect. It is about real money for real people and real jobs at a time when they have never been more needed in Europe, particularly by the very many affected by the crisis of youth unemployment. The MFF deal will put in place a robust €960 billion budget for investment that will enable the European economy to grow, create jobs and begin to address youth employment. It is a matter of some urgency across Europe that this major investment is implemented without delay.

Ireland will benefit, in particular, from a strong and well funded Common Agricultural Policy and increased funding for competitiveness and jobs. This includes the special allocation of €6 billion for youth unemployment, in respect of which we have given our support to a front-loading beginning in 2014. We will also benefit from a number of specific and tailored resource instruments, including a special allocation of €100 million for rural development and another of the same size for the Border, midlands and western, BMW, region. I am especially satisfied to have been instrumental in ensuring a special allocation of €150 million for the PEACE programme.

I look forward to moving beyond the detailed negotiations to address the major political challenge we share as politicians, whether at the Council or in the Parliament, which is to ensure we use every euro of EU resources to address the impact of the crisis and the blight of unemployment across our European family. We have no time to lose.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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I thank the Tánaiste for his reply. Last weekend he was accused by certain Members of the European Parliament from both major groupings, the European People's Party and the socialist group, of "objectionable manipulation" in respect of his pronouncements on the multi-annual financial framework. Today he is talking about a "core package" rather than a done deal, the latter being what we understood from his public comments had been achieved following the conclusion of talks at the end of last week. Will he update us on what is happening within the major groups in the European Parliament? Have they been given a particular timeline in which to reach agreement and go to a plenary session of the Parliament? Is there any indication that major obstacles remain in turning the core package to which the Tánaiste referred into a done deal on the future financing of the European Union up to 2020?

Eamon Gilmore (Dún Laoghaire, Labour)
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As I indicated, the Parliament rejected the multi-annual financial framework agreed to by the Council in February, with more than 500 Members voting against it. We have since been engaged in discussions with it to establish a basis for the taking of a further vote. A plenary session will take place next week and it is our objective that a vote will be taken at that stage. The negotiations concluded last week and both Mr. Lamassoure and I agreed to recommend what we had agreed to the Council in my case and the Parliament in his. There are indications from the Parliament that the package negotiated will not be deemed acceptable when it is put to a vote next week. In that context, we have indicated a willingness to engage in further discussions with the Parliament on additional adjustments to the package. There are several issues which, although not central to the MFF negotiations, are relevant as a consequence of the Parliament's decision to make a link between acceptance of the MFF and the draft amending budget for 2013. We have suggested a way of progressing matters might be for Mr. Lamassoure and me to meet the four Presidents tomorrow.

Brendan Smith (Cavan-Monaghan, Fianna Fail)
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Has the issue of the deficit for the 2012-13 budget been resolved? The Tánaiste has indicated that the Parliament discussed the securing of additional funding by way of own resources. Have particular sources of revenue been identified in this regard? The financial transaction tax which is not acceptable to us is probably the one with the most potential. Are other areas being considered by the Commission, the Council or the Parliament?

There was concern following the Council's agreement last February in respect of continued regional development funding for the BMW region. Has that matter been resolved?

Is there likely to be a substantial cut in the budget for research and innovation development which comes within the remit of the Irish Commissioner, Ms Máire Geoghegan-Quinn? If we are to address the long-term employment issues within Europe, surely it makes no sense to cut funding for research and innovation? That funding is essential if we are to acquire the knowledge and know-how to create much needed employment on the island and throughout the other 27 member states from 1 July.

Eamon Gilmore (Dún Laoghaire, Labour)
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Agreement was reached yesterday on Horizon 2020, the plan for the research and innovation budget. The overall European Union budget for the period in question is a very substantial €960 billion for the period up to 2020. That funding is critical for the programmes it will underpin.

The issue of own resources was one of those raised by the Parliament and agreement in that regard was not achieved at European Council level, including on the question of a financial transaction tax. The package agreed to by Mr. Lamassoure and me proposes that there be a declaration which would provide for a discussion over the lifetime of the MFF on the issue of own resources. That discussion would involve the Parliament, the Commission and the Council, make provision for the involvement of national parliaments and provide for reportage at six monthly intervals.