Download Bond event on the European Union`s EU Budget (Multiannual

Bond event on the European Union’s EU Budget (Multiannual Financial Framework)
Monday 15 October 2012
Minutes from the event (held under Chatham House rule)
The first panel focused on the size of the EU aid budget within the proposed Multiannual Financial
Framework (MFF), which covers the period 2014-2020. EU Official Development Assistance (ODA)
sits under Heading 4 of the MFF.
The panel was chaired by Lucy Lamble, International Development Editor, The Guardian. Other
speakers included Mark Hendrick MP, Adrian Lovett of ONE, Patrick Holden of Plymouth University.
Presentations highlighted the following key issues:
EU aid is a major feature in the media at the moment but the debate is not always based on accurate
facts. The EU is the second largest donor in the world and is responsible for 60% of the world’s ODA.
Around 70% of EU ODA comes from the EU budget and 30% comes from the European Development
Fund (EDF). The EDF is technically voluntary, whereas the EU budget is not. Also, the EDF is not
subject to oversight by the European Parliament – MEPs are trying to have this changed, and
increased accountability is seen as crucial. The European Commission has proposed a 13% real terms
increase for EDF, compared to a 3% real terms increase for whole EU budget. EU ODA is 6% of the
whole EU budget
The case for EU aid is seen as hard to make in the UK political scene. However, according to ONE’s
survey of 1000 people, 61% say 1.6 penny in every pound spent on aid is about right, or not enough.
Panellists focused both on benefits and limits of EU aid. Benefits include its high quality. It ranks
highly on indicators for effectiveness; Publish What You Fund ranked the EU #5 on transparency; EDF
was labelled ‘‘very good’’ in DFIDs Multilateral Aid Review. It also works, and it encourages other
countries to reach the 0.7% target. The EU has a presence and coordinating role for aid in many
countries.
However, others stressed that EU as an aid donor also has limitations, and in particular it is not seen
as a leader in expertise or research like DFID or the World Bank is. That EU may also not be well
suited to deal with smaller projects. However, the EDF is one of the most effective development
funds. And some “sluggishness” of EU aid is an advantage in making it predictable. Also important to
remember that other EU policies, such as those on trade, especially with sub-Saharan Africa, can
sometimes damage or be in contradiction with aid policy.
Q&A
The Q&A session focused on whether ODA should be redefined, on what can be done to stop aid
having a negative impact in some cases, on whether other member states of the EU have a better or
worse poverty focus than the EU, and on what should be done about giving aid to Middle Income
Countries.
The second panel focused on whether the EU aid budget is well targeted. Speakers included: Lucia
Andrade, of the Pro-Indian Commission of Sao Paulo, a Christian Aid partner in Brazil; Domenico
Rosa of the European Commission; Dave Smith of DFID and Mikaela Gavas of the ODI.
The speakers focused on the debate over how to address inequality and sustainability issues when
considering aid to MICs, the rapid growth of BRICS and the role of ODA within this. The EU has
established its Agenda for Change and its current priorities are governance and law (so investors feel
safe), health and education, and drivers of growth – agriculture and production and green energy.
The last 5 years have also seen countries graduate from Low Income Countries to MIC status, so
these countries need a different kind of support. For example, Brazil needs support in reducing
inequality as GDP grows. DFID has pushed for EU aid to focus on the poorer countries; however it is
difficult with 27 member states wanting different things.
The Q&A focused again on what to do about aid to poor people in MICs and specifically about the
Indian case. A question from the floor focused on the fact that EC emergency and humanitarian aid
is being decreased, asking where that money will come from when it’s needed. Others wondered
about how flexible this budget will be, especially in terms of incorporating new principles from the
post-2015 development framework. This seems unclear for the moment.
In the closing remarks, the Nobel Peace Prize awarded to the EU was mentioned as a recognition
that economic advancement is central to peace and development and that it’s important to also see
EU aid in this context. Bond member organisations were invited to get more involved in the EU
Budget negotiations and to contact Germana Canzi, Bond’s EU policy adviser [email protected]