THE ROLE OF THE EUROPEAN UNION PARLIAMENT IN SHAPING EU FINANCES

Abstract

The European Parliament is one of the most important EU institutions as it represents nearly 500 million EU citizens. The Euro-parliamentarians are chosen in direct elections which gives the Parliament democratic credentials. The powers of the Parliament have been steadily increasing. The institution has legislative powers in the form of a co-decision procedure. The budgetary powers of the Parliament depend on the type of expenditure. The Parliament can only propose modifications to compulsory expenditure, but the Council has the final say in such matters. Non-compulsory expenditure which is not regulated by EU treaties or Community legislation can be amended by the majority of MEPs who vote in favor of changes. Non-compulsory expenditure includes social, regional and industrial policies accounting for about 39 per cent of the Community budget. The Parliament can refuse to pass the budget. In such cases, the budget cannot be implemented and a “Conciliation Committee” is established to resolve the problem. The Parliament may also reject the budget by a two-thirds vote cast by a majority of MEPs.