Micheál Martin (Cork South Central, Fianna Fail)
Link to this: Individually | In context | Oireachtas source

192. To ask the Minister for Finance if Ireland has to pay extra money to the EU budget after the upwards re-evaluation of GDP; and if he will make a statement on the matter. [41690/14]

Michael Noonan (Limerick City, Fine Gael)
Link to this: Individually | In context | Oireachtas source

Ireland's contribution to the EU Budget is an obligation of EU membership and is a charge on the Central Fund. The contribution formula for the EU Budget is comprised of Traditional Own Resources (customs duties), a VAT-based payment and a residual balancing component paid in accordance with each Member State's (MS) share of EU Gross National Income (GNI).

Annually, a technical rebalancing exercise is carried out which retrospectively adjusts MS preceding years' budget contributions. This exercise not only takes account of updated MS GNI, but also updated VAT data. These balancing payments are called up for automatic payment, in accordance with the relevant legislation, on 1st December each year.

In parallel with this, the Commission has proposed Draft Amending Budget 6 (DAB 6) which includes a technical redistribution of these balancing payments across MS and also takes account of updated Traditional Own Resources forecasts. The net impact of these two exercises is an estimated additional contribution of €6.5m for Ireland. (Separately, under DAB6, the forecast for Ireland's Traditional Own Resources has been updated by €6m.). It should be noted that, whereas the payment under the technical balancing exercise is automatic, DAB 6 must be agreed by both Council (QMV) and Parliament.

Since the publication of DAB 6, the Commission has proposed an amendment to the applicable EU legislation which if adopted would allow member states, under certain conditions, to defer making their balancing payments to 1st September 2015. The result would be that balancing payments received on December 1st would be redistributed this year. Where member states opt to make their balancing payments after this, a new draft amending budget would have to be proposed in 2015 to redistribute these monies.

Accordingly, the full net impact of the additional €6.5m contribution will accrue to Ireland only after all member states make their balancing payments, either this year or next.