European Scrutiny Committee Meeting Summary: 10 December 2014

The Committee considered the following documents:

EU Budget 2014

The Council and the European Parliament have failed to reach agreement on the Commission’s original Draft Budget for 2015. Consequently the Commission has presented a revised Draft Budget, which we consider this week. The Government tells us that it welcomes that the revised draft Budget represents a €800 million (£636.2 million) cut compared to the Commission’s original proposal, but that it continues to consider that there should be a significant margin between the agreed budget and the annual Multiannual Financial Framework ceiling for the purpose of sound budgetary management. It notes that the Budget is agreed by Qualified Majority Voting, and that it will therefore need to work closely with like-minded budget disciplinarian Member States to deliver the best deal possible for the UK. We have also learned separately that the Council’s Committee of Permanent Representatives agreed a position on this Draft Budget, which appears to be acceptable to the European Parliament and to be a done deal, which the Council will merely formally adopt on 12 December.
We have little information about how agreement on the 2015 EU General Budget relates to resolution of the disagreement between the Council and the European Parliament on a number of Draft Amending Budgets for the 2014 EU General Budget. We say that, before considering this document again, we wish to have a full explanation from the Government of developments on all these budgetary matters. We also request that the Government provide us with an explanation of the scrutiny breaches in relation to these issues, particularly the failure to deposit the revised Draft Budget, published on 28 November, until 10 December. When we receive this information, we will consider whether we wish for the Minister to appear before us in person. In the meantime, we retain this document under scrutiny.

UK Block opt-out

This week we consider two Decisions, one adopted by the Council, the other by the Commission, which complete the processes necessary to enable the UK to rejoin 35 EU police and criminal justice measures, following the exercise of its block opt-out. The Home and Justice Secretaries confirm that two scrutiny overrides have taken place in recent weeks in relation to this matter. We invite them to give evidence at the earliest opportunity, so that they can explain why the scrutiny process has been so poorly handled.

Financial services: occupational pension funds

The 2003 Institutions for Occupational Retirement Provision (IORP) Directive sets out a minimum harmonisation framework for occupational pension schemes and their supervision. This week we revisit a draft Directive which would revise the existing Directive by introducing new rules concerning the governance of these schemes and the information that schemes should provide to their beneficiaries. We have shared the Government’s concerns about the lack of justification for the proposal, subsidiarity issues and the practical consequences of the measure. When we last considered this proposal back in July, we said that we wished to hear from the Government about its efforts to forestall the draft Directive, including the results of its detailed consideration, with the UK pensions sector, of the potential impact of the proposal. The Government now informs us that there is a considerably amended and more flexible Presidency text and that the Presidency hopes to secure COREPER agreement to a General Approach. The Government tells us it won’t support such a General Approach and that, in effect, it still hopes to see the proposal aborted. The Government does not provide us with the information about the results of its consideration of the impact of the proposal which we requested previously. We ask the Government to provide us with this information, and to confirm that it will continue to oppose the measure if it goes to Council.

Other documents

We are also reporting on documents relating to:

• Business, Innovation and Skills: Single-member private limited liability companies; Accession of Kazakhstan to the World Trade Organisation;
• Defence: European Defence Agency;
• Foreign and Commonwealth Office: Restrictive measures against Iran: nuclear issues; Restrictive measures against Zimbabwe; EU restrictive measures against the Syrian regime; Intergrated Border Management Assistance Mission in Libya; Rules of procedure of the General Court; Common Security and Defence Policy: EULEX Kosovo: allegations of corruption; EU support for the Organisation for the Prohibition of Chemical Weapons in Syria
• Home Office: Forced labour;
• Transport: Seafarers; Carbon dioxide emissions from maritime transport; Working time: inland waterway transport; Single European Sky;
• Treasury: EU staff pensions; Value added taxation; Money laundering and terrorist financing.

The Committee’s 24th Report of Session 2014-15 will be published shortly, covering: The UK’s 2014 block opt-out decision; Financial management; International Procurement; Public Procurement in the EU; The EU and the post-2015 development agenda; EU Action to support Afghan civilian policing and Rule of Law post-2014; Common Security and Defence Policy: Policing in Afghanistan; EU and Georgia: EU monitoring mission; Restrictive measures against Iran; EU civilian CSDP mission in Ukraine: launch and status of mission; Food and Agriculture Organisation; Economic Partnership Agreement with the West African region; Food and Agriculture Organisation; Economic Partnership Agreement with the West African region; Taxation; Financial services: payment services.

Further information

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