Annual EU Budget procedure

The financial year covers the period from 1 January to 31 December. The Council and the European Parliament adopt the annual EU budget according to the budgetary procedure laid down in article 314 of the Treaty on the Functioning of the EU (TFEU). The budgetary procedure is carried out in the year preceding that in which the budget is to be implemented (see. attached diagram).

The Council position on the draft budget presented by the Commission is prepared and adopted by the Member States within the following preparatory bodies of the Council of the EU:

• At expert level – at the Budget Committee meetings;
• At political level – at the Committee of Permanent Representatives of EU Member States (COREPER) and consequently at the Economic and Financial Affairs Council (ECOFIN/Budget) meetings.

Once the Council position is adopted, it is sent to the European Parliament before 1 October. The Parliament has then 42 days to adopt its amendments on the Council's position. The Council may accept the amendments within 10 days whereby the budget will be deemed adopted. In case the Council does not accept the Parliament's amendments, a Conciliation Committee is convened with the task of reaching an agreement between the two institutions EU on a joint text within a period of 21 days following the adoption of the European Parliament’s position. The ECOFIN-Budget Council gives a negotiations mandate to the Presidency of the Council. The agreement reached is then subject to an approval by the Council and the Parliament within 14 days of the agreement. In case both the Council and the Parliament reject the joint text or fail to decide within the conciliation period, the Commission has to submit a new draft budget.

The experts at the Ministry of Finance are responsible for the preparation of instructions, comments and positions on the draft EU budget for the Budget Committee, COREPER and ECOFIN/Budget meetings. The national positions are coordinated within Working Group 28 “Financial and budgetary affairs” to the Council for European Affairs and in the frameworks of this Council.

Source:  http://ec.europa.eu/budget/explained/management/deciding/decide_en.cfm