Codecision on the EU's 130 billion Euro annual budget spending is a core piece of the European Parliament's powers. Alain Lamassoure, newly elected as President of the Budget Committee, explains how he plans to use the Parliament's increased powers under

The Interview: Preparing for the big budget battle

Alain Lamassoure,   welcome to EuroparlTV.

You're a member   of the presidential majority in France

and you've just been elected chairman   of the Budgets Committee.

Not necessarily a very glamorous   committee but definitely vital.

Let's first get to the crux of the matter,   the spoils of war.

What is the EU budget and how much   is it, in terms of cold, hard cash?

It is in the order of 130 billion euros.

Within that, there are two huge amounts   that make up more than 40%,

initially, the only European budget   and the only common policy.

It still makes up almost 40% of the total   spending of the European Union.

The other large amount, another great   community policy, the Regional Policy,

which the most disadvantaged   regions benefit from.

Currently, these are the central   and eastern European countries.

130 billion euros is an amount   that makes heads spin.

It's a lot of money but it is not even 1%   of European national wealth.

It's the budget of the Netherlands,   which has 15 million inhabitants.

less than 1% of the total revenue   for the 27 European countries.

In relative terms, in regards to the wealth   of the European Union

the budget has been in decline for years.

In fact, the budgetary crisis is one of   the hidden crises of the European Union.

who are increasingly poor and require   European aid and welfare funds.

What is the role of the Budgets   Committee in all of this?

It's a very important role because   currently, in line with European treaties,

the European budget is adopted   by the governments and the Parliament.

The governments are   the Council of Ministers.

The Parliament acts on proposals   of the Budgets Committee.

There is a strange division of   responsibilities that is historical

and that would disappear   under the Lisbon Treaty.

It distinguishes between two categories of   spending: agricultural and other types.

For historical reasons and due to the   French, who prioritise agriculture,

the agricultural budget is exclusive   to the Council of Ministers.

The Parliament votes on modifications to   give a bit more here or a bit less there...

The Council is not obliged   to take these on board.

The Council politely discard amendments   and make their own decisions.

However, for all the other spendings   that represent about 60% of the budget,

the governments and Parliament   have to come to an agreement.

If they can't agree,   the Parliament has the last word.

In 2006, a revision clause   was put in place

to decide the new financial   structure from 2013.

Which areas are most important?   Spending or revenue?

No, but we will have to make huge   modifications in both areas.

In terms of spending, the European   budget is annual, as they all are.

But it is of great advantage to be part   of a multiannual framework of 7 years,

which defines,   in 5 main areas of spending,

how much should be allocated   during each of these 7 years.

As of next year, we are going   to update this framework,

We're at the midway point   of this period.

A lot has happened since the beginning of   2007, not least the economic crisis.

We are going to review   European spending in depth,

so that European funds are directed   more towards policies relating to recovery,

economic support, preparation   for the future, investment and research,

Does that mean less money   for the Common Agricultural Policy?

That depends. There may be spending   on agriculture in the future.

I'm not going to speculate on that now.   I'll cover the political plans.

A domain in which I've worked   a lot in the previous parliament

and which I plan to highlight   on the Budgets Committee,

is the area of revenue,   that no one has dared touch until now.

How will you do it?   -There are three options.

The easiest way would be   to take some of the income from VAT,

since all the 27 European countries   have a form of VAT,

which has identical rules of calculation   and evaluation all over of Europe.

For example, in France,   we pay a VAT of 19.6%.

and 0-2% could be allocated   to the European budget.

There is an economic logic here. We've   created a unique European market.

We've tried to harmonise   the conditions of competition

so it is equal and fair   for all European countries.

We have reached the point of   eliminating monetary distortions.

We all have the same currency, the Euro.

There's only one element   that disrupts competition,

the different systems   we have for the taxation of profit.

We even have a different definition   of taxable profit in the 27 countries.

That's another option   but it requires us to agree in advance

on standardising the definition   of taxable profit.

It's not a foregone conclusion.   -Correct.

It's been under debate   for a decade already.

Nevertheless, we've made progress.   The report is technically complete.

It is one of the reports   that will have to be opened next year.

You were talking about the difficulty and   possibility of creating a European tax.

In a period of crisis,   no one likes the creation of a new tax.

I observe with amusement   that people are against new taxes.

Yet,everyone is in favour of   the carbon tax.

The carbon tax is a new tax that everyone   has accepted with enthusiasm.

As of 2011,   in the fight against climate change,