Financial Perspectives: the Multiannual Finance Framework (MFF)
The multiannual financial framework (MFF) lays down the maximum annual amounts ('ceilings') which the EU may spend in different political fields ('headings') over a period of at least 5 years. The upcoming MFF covers the next seven years, from 2021 to 2027.
The MFF is not the budget of the EU. It provides a framework for financial programming and budgetary discipline by ensuring that EU spending is predictable and stays within the agreed limits. It also allows to carry out the EU common policies over a period that is long enough to make them effective. This long term vision is important for potential beneficiaries of EU funds, co-financing authorities as well as national treasuries.
By defining in which areas the EU should invest more or less over the seven years, the MFF is an expression of political priorities as much as a budgetary planning tool. The annual budget is adopted within this framework and usually remains below the MFF expenditure ceilings in order to retain some flexibility to cope with unforeseen needs.
Proposed by the European Commission, the regulation laying down the MFF must be adopted by the Council by unanimity after obtaining the consent of the European Parliament.
The MFF is part of a comprehensive package which also comprises theEU own resources and a set of sector-specific legislations defining the conditions of eligibility and the criteria for the allocation of funds for each EU spending programme.
Based on the multiannual financial framework Regulationin force and the budget guidelines for the coming year, the EuropeanCommission prepares the draft budget and submits it by 1 September to the Council and the European Parliament. The Council first adopts its position on the draft budget by 1 October (including amendments).
The position of the Parliament follows within 42 days (also including eventual amendments). In case of divergent positions of the Council and the Parliament, a Conciliation Committee is convened with the task of reaching agreement on a joint text within a period of 21 days following the adoption of the European Parliament's position.
This joint text is then subject to the approval of the Council and the Parliament within 14 days of the agreement.