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Planning the European Union budget
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Question from Fanny, in Strasbourg.

“My question is how is the EU budget structured and why is it planned for a period of seven years?”

Answered by Patrizio Fiorilli, spokesperson for the European Commissioner for the Budget.

“How is the EU budget is structured? Basically, it is divided into five headings and there are legal and technical terms which I won’t go into.

‘The areas are, the economy, agriculture, justice and immigration, international, while a part is also given over to administration. So that is the annual budget.

‘Then there is the financial framework over a period of seven years.
First, why do we have a financial framework? Well, it is actually very simple, it is a bit like the monthly limit on your credit card.

‘Just imagine that you have a credit card with no limits, you can make purchases for tens of thousands of euros and then one day you have problems because you have to pay the bill.

‘It is the same for the budget of the European Union. As the bulk of this budget is to pay for projects that extend over several years the financial framework sets limits for the entire annual budget, for each part of the budget. Why seven years? Because it was necessary to agree on a number of years.

‘Imagine for example a city or region that wants to build a bridge or a railway track with European funding. It is done over several years, so we cannot have a time period that is just two or three years since some projects take a long time to be finalised.

‘One cannot have a period of 10 years because how do you predict what the political guidelines will be in 10 years, what will be the priorities?

‘And finally seven years seemed a good compromise between the stability that allows us to plan work on a long term basis but can not go on too long. “

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