Mr. Tony Murphy:

I will try to bring some of the issues together, rather than answer the questions in the order they were asked.

Cohesion is more important in eastern Europe. We have certain living standards that eastern Europe does not yet have, as is quite obvious if one visits any eastern European country. The table shown reflected this in indicating how important funding was when compared to total government expenditure. In eastern Europe the level of funding can reach 20%, whereas here it is 1%. It is a significant issue in some of the member states concerned.

The discussion on the Multi-annual Financial Framework, MFF, is ongoing. We have seen some briefing papers, on which we have made some contributions and suggestions, but we are not a party to the negotiations. We will wait and see how it works out. The final breakdown of the MFF budget and the future of the CAP are interlinked. We are sometimes asked for opinions on specific things which we give, but at the end of the day it is for legislators in the Parliament and the Council to ultimately decide. While we have a certain role to play in the process, our role is more ex-postin seeing how whatever legislative proposal is decided on should be implemented. It is a slightly different approach.

The audit of child poverty will begin next year. We will be starting a new audit. The report referred to was mostly likely the one from the Organisation for Economic Co-operation and Development. We will take it into account when we start the audit.

GNI* and GDP are other issues. Our contribution has increased because of the use of GNI*. It is becoming more important because we have recently become a net contributor. A review is ongoing of how owned resources will be used to fund budgets in the future. It might have a fundamental affect. Whether the proposals ever proceed is another matter. Regardless of whether they will be based on taxes on plastic or there will be a consolidated tax base, it will all impinge on the GNI* element of total contributions. The means by which GNI* will be calculated is also being considered. It is an ongoing process.