Interinstitutional agreement on budget discipline, cooperation and management

The 2013 interinstitutional agreement is designed to implement budgetary discipline and improve the functioning of the annual budgetary procedure and cooperation between European Union institutions on budgetary matters, as well as to ensure sound financial management.

ACT

Interinstitutional agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management.

SUMMARY

In December 2013, the agreement on budgetary discipline, cooperation on budgetary matters and sound financial management (IIA) was concluded between the European Parliament, the Council and the Commission.

The IIA was adopted in parallel to the multiannual financial framework (MFF), the EU’s 7-year plan covering the 2014-20 period. The MFF amounts to €960 billion in commitments (legal promise to provide finance) and €908.4 billion in payments (actual transfers to beneficiaries) over the 7-year period, expressed in constant prices of the year 2011.

The IIA comprises three sections, as shown below.

• Part I contains complementary details regarding the 2014-20 MFF, as well as on special financial instruments not included in the MFF (such as the Emergency Aid Reserve (used to finance, for example, humanitarian aid and civilian crisis management), the European Union Solidarity Fund, the Flexibility Instrument (used to fund expenditure which could not be financed within the limits of the available budget headings), the European Globalisation Adjustment Fund and the Contingency Margin (a last-resort instrument to react to unforeseen circumstances). It also lays down procedures for the use of these instruments.
• Part II aims to improve the cooperation between the Parliament, the Council and the Commission in relation to budgetary matters. This will allow, for instance, more transparency at all stages of the budget negotiations and more information about how EU money is spent.
• Part III relates to the sound financial management of EU funds. It deals with aspects like evaluating spending and financial programming to ensure spending is effective.

The IIA’s annex lays down detailed rules for cooperation between the institutions during the budgetary procedure. These cover:

• agreement on a pragmatic calendar;
• priority setting;
• establishing the draft budget and updating of estimates;
• specific decision-making procedures at different stages of the budget process;
• amending budgets;
• the issue of outstanding commitments (not yet translated into payments).

Any amendment of this IIA requires the joint agreement of all the institutions.

Background

For further information, see also:

• European Parliament website
• Council of the European Union website
• European Commission website.

RELATED ACTS

1311/2013 of 2 December 2013 laying down the multiannual financial framework for the years 2014-20 (Official Journal L 347 of 20 December 2013, p. 884-891).

Last updated: 24.04.2014