Explanatory Memorandum to COM(2010)533 - Amending budget N° 8 to the budget 2010, Section III - Commission - Main contents
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| dossier | COM(2010)533 - Amending budget N° 8 to the budget 2010, Section III - Commission. |
|---|---|
| source | COM(2010)533  |
| date | 24-09-2010 |
DRAFT AMENDING BUDGET N° 8 TO THE GENERAL BUDGET 2010 STATEMENT OF EXPENDITURE BY SECTION Section III - Commission /* COM/2010/0533 final */
[afbeelding - zie origineel document] EUROPEAN COMMISSION
Contents
- Brussels, 24.9.2010
- STATEMENT OF EXPENDITURE BY SECTION Section III - Commission
- STATEMENT OF EXPENDITURE BY SECTION Section III - Commission
- CHANGES TO THE STATEMENT OF REVENUE AND EXPENDITURE BY SECTION
- TABLE OF CONTENTS
- 1. Introduction 3
- 2. Mobilisation of the EU Solidarity Fund 3
- 2.1. Ireland: Flooding 3
- 3. Financing 5
- 4. Summary table by heading of the Financial Framework 7
- 1. INTRODUCTION
- 2. MOBILISATION OF THE EU SOLIDARITY FUND
- 2.1. Ireland: Flooding
- 3. FINANCING
- Ireland, 2009 flooding 520 900 935 456 13 022 13 022
- 4. SUMMARY TABLE BY HEADING OF THE FINANCIAL FRAMEWORK
COM(2010) 533 final
DRAFT AMENDING BUDGET N° 8 TO THE GENERAL BUDGET 2010
(presented by the Commission)
DRAFT AMENDING BUDGET N° 8 TO THE GENERAL BUDGET 2010
Having regard to:
- the Treaty on the Functioning of the European Union, and in particular Article 314 thereof, in conjunction with the Treaty establishing the European Atomic Energy Community, and in particular Article 106a thereof,
- the Council Regulation (EC, Euratom) No 1605/2002 of 25 June 2002 on the Financial Regulation applicable to the general budget of the European Communities i, and in particular Article 37 thereof,
- the general budget of the European Union for the financial year 2010 adopted on 17 December 2009 i,
- the amending budget 1/2010 adopted on 19 May 2010 i,
- the amending budget 2/2010 adopted on 16 June 2010 i,
- the amending budget 3/2010 adopted on 7 September,
- the draft amending budgets No 2/2010 i, 3/2010 i, 5/2010 i, 6/2010 i and 7/2010 i.
The European Commission hereby presents to the budgetary authority the Draft Amending Budget No 8 to the 2010 budget.
The changes to the statement of revenue and expenditure by section are available on EUR-Lex ( eur-lex.europa.eu/budget/www/index-en ). An English version of the changes to these statements by section is attached for information as a budgetary annex.
Draft Amending Budget (DAB) No 8 for the year 2010 covers the following elements:
- Mobilisation of the EU Solidarity Fund for an amount of EUR 13,0 million in commitment and payment appropriations relating to the effects of severe flooding affecting Ireland.
- A corresponding reduction in payment appropriations of EUR 13,0 million from the line 04 02 01 — Completion of European Social Fund (ESF) — Objective 1 (2000 to 2006).
In November 2009, the major part of Ireland was affected by heavy rain leading to severe flooding. The flooding caused severe damage to the agricultural sector, residential properties and businesses, to the road network and other infrastructure.
Subsequently, Ireland submitted an application for financial assistance from the European Union Solidarity Fund.
The Commission services have carried out a thorough examination of the application in accordance with Council Regulation (EC) No 2012/2002 i and in particular with Articles 2, 3 and 4 thereof. The most important elements of the assessment can be summarised as follows:
1. The application was received at the Commission on 27 January 2010, within the deadline of 10 weeks after the first damage was recorded on 19 November 2009. On 15 June 2010, following a request by the Commission of 24 March, the Irish authorities submitted further information confirming inter alia the estimated amount for total direct damage and presenting a more refined damage evaluation.
2. The disaster is of natural origin and therefore falls within the field of application of the Solidarity Fund.
3. The Irish authorities estimate the total direct damage caused by the disaster at EUR 520,9 million. This amount represents 55,68 % of the normal threshold for mobilising the Solidarity Fund applicable to Ireland in 2010 of EUR 935,45 million (i.e. 0,6 % of GNI based on 2008 data).
4. As total damage remains below the normal threshold the application was examined on the basis of the so-called “extraordinary regional disaster” criterion laid down in Article 2 i, final subparagraph, of Regulation (EC) No 2012/2002 setting out the conditions for mobilising the Solidarity Fund “under exceptional circumstances”. Under this criterion, a region can exceptionally benefit from assistance from the Fund where that region has been affected by an extraordinary disaster, mainly a natural one, affecting the major part of its population, with serious and lasting repercussions on living conditions and the economic stability of the region. The Regulation calls for special focus on remote and isolated regions such as the insular and outermost regions defined in Article 349 of the Treaty. The Regulation calls for 'utmost rigour' in assessing applications presented under the 'extraordinary regional disaster' criterion.
5. Ireland is part of the third largest island in Europe situated on the northwestern border of continental Europe. While Ireland is not an outermost region as defined in the Treaty its insularity and remoteness from the European mainland clearly impact its economic situation and make it more vulnerable. These factors cannot be disregarded in assessing Ireland's application for Solidarity Fund assistance.
6. As set out in the Annual Report on the Solidarity Fund (2002-2003) i the Commission considers that, in order for the specific criteria for regional disasters to be meaningful in the national context, a distinction needs to be drawn between serious regional events and those that are merely local. In accordance with the principle of subsidiarity the latter are the responsibility of the national authorities, while the former can be considered for support under the Solidarity Fund. The flooding disaster seriously affected a major part of Ireland's territory. The Irish authorities claim that the disaster has dramatically worsened the situation where Ireland is already suffering from the most serious economic downturn that the country has seen over the past decades.
7. One of the conditions set out in Regulation 2012/2002 for the exceptional mobilisation of the Solidarity Fund is that the major part of the population in the region to which the application relates must be affected. The region on which the Irish application is based comprises a coherent area of 15 counties with over 1,7 million inhabitants (around two thirds of the Irish territory and 40 % of the population). The application describes the different ways in which the population was affected through personal damage and interruption of economic activities, disruption of main utilities, and interruption and damages to the road network. With the exception of Cork and Galway City, the majority of the damage occurred in predominately rural areas where the roads infrastructure is crucial to carry out day-to-day businesses. Moreover, in relation to those directly impacted, a significant amount of individuals have received assistance from the Social and Family Affairs Humanitarian Assistance Scheme. A particular factor is the long duration of the flooding which in some areas lasted several months. It can thus be concluded, as described in the Irish application, that the major part of the population was affected.
8. As regards the impact and consequences of the flooding as well as the requirement to demonstrate serious and lasting repercussions on the living conditions and the economic stability of the region, the application refers in particular to the destabilisation of the farming sector and the impact of the flooding on the road infrastructure with damages to the latter alone of over EUR 159 million. The region affected by the flooding includes counties in the Border, Midland and Western NUTS2 region where the gross value added (GVA) per person is only 69,3 % of the State average (data of 2007). The Midland region has the lowest GVA per person at 65.8 % of State average. With the sharp economic downturn of the past years and few employment opportunities at present, the flooding caused even a higher employment deficit. Moreover, the share of GVA of agriculture within the affected region is higher than in all other regions of Ireland. Many farmers had to be granted aid under the Aid Scheme for Damaged Fodder as their complete fodder stocks had been destroyed. Disruption to farming production impacts proportionately on a greater number of people in the affected regions in a more significant way than would be the case in regions les dependent on the agricultural sector. The insularity of Ireland and the relative remoteness from mainland European economies add to the difficulties to recover from an already challenging situation. Over all, it can be concluded that the flooding caused serious and lasting repercussions on the living conditions and the economic stability in a predominately rural area struggling to improve living standards and encourage investment opportunities.
9. The cost of operations eligible under Article 3 i of Regulation 2012/2002 is estimated at EUR 111,5 million and broken down into 4 categories: A) immediate restoration to working conditions of infrastructure, B) temporary accommodation and rescue services, C) preventive infrastructures and immediate protection of cultural heritage and D) cleaning up of disaster stricken areas/zones.
10. The affected regions are eligible as 'Competitiveness and Employment Regions' (8 regions) and 'Phasing-in regions' (7 regions) under the Structural Funds (2007-2013).
11. As regards a possible coverage of eligible damage by insurance, the Irish authorities indicated that there is no insurance coverage of eligible cost.
In conclusion, for the reasons set out above, the flooding referred to in the application can be considered to be extraordinary within the meaning of the Regulation and to meet the conditions set out by Article 2 i, last subparagraph, of Regulation 2012/2002 for exceptionally mobilising the Solidarity Fund.
The total annual budget available for the Solidarity Fund is EUR 1 billion. As solidarity was the central justification for the creation of the Fund, the Commission takes the view that aid from the Fund should be progressive. That means that, according to previous practice, the portion of the damage exceeding the threshold (0,6 % of the GNI or EUR 3 billion in 2002 prices, whichever is the lower amount) should give rise to higher aid intensity than damage up to the threshold. The rate applied in the past for defining the allocations for major disasters is 2,5 % of total direct damage under the threshold for mobilising the Fund and 6 % above. The methodology for calculating Solidarity Fund aid was set out in the 2002-2003 Annual Report on the Solidarity Fund and accepted by the Council and the European Parliament.
It is proposed to apply the same percentages in this case and to grant the following aid amounts:
(EUR)
Direct damage Threshold Amount based on 2.5 % Amount based on 6 % Total amount of aid proposed
Total 13 022
This amount of compensation will leave at least 25 % of the European Union Solidarity Fund available for allocation during the last quarter of the year, as required by Article 4 i of Regulation (EC) 2012/2002.
At the current stage the expected needs on budget line 04 02 01 — Completion of European Social Fund (ESF) — Objective 1 (2000 to 2006) are such that payment appropriations of EUR 13 022 500 may be reallocated to budget line 13 06 01 to cover the corresponding needs related to the mobilisation of the EU Solidarity Fund.
Financial framework Heading/subheading 2010 Financial framework Budget 2010 (including AB 1 to AB 3 and DAB 2 to DAB 3 + DAB 5 to DAB7) DAB 8/ Budget 2010 (including AB 1 to AB 3 and DAB 2 to DAB 3 + DAB 5 to DAB8)
|CAPACAPACAPACAPA 1. SUSTAINABLE GROWTH 1a. Competitiveness for growth and employment14 167 000 14 861 853 11 342 270 14 861 853 11 342 270 1b. Cohesion for growth and employment49 388 000 49 387 592 36 384 885 -13 022 49 387 592 36 371 862 Total63 555 000 64 249 445 47 727 155 64 249 445 47 740 178 Margin i-194 445 -194 445 2. PRESERVATION AND MANAGEMENT OF NATURAL RESOURCES Of which market related expenditure and direct payments47 146 000 43 819 801 43 701 207 43 819 801 43 701 207 Total59 955 000 59 498 833 58 135 640 59 498 833 58 135 640 Margin456 166 456 166 3. CITIZENSHIP, FREEDOM, SECURITY AND JUSTICE 3a. Freedom, Security and Justice1 025 000 1 006 487 738 570 1 006 487 738 570 3b. Citizenship668 000 668 000 659 387 +13 022 +13 022 681 022 672 410 Total1 693 000 1 674 487 1 397 957 +13 022 +13 022 1 687 509 1 410 980 Margin i18 512 18 512 4. EU AS A GLOBAL PLAYER i7 893 000 8 160 182 7 787 695 8 160 182 7 787 695 Margin -18 300 -18 300 5. ADMINISTRATION i7 882 000 7 918 504 7 917 999 7 918 504 7 917 999 Margin 43 495 43 495 TOTAL140 978 000 134 289 000 141 501 452 122 966 449 +13 022 141 514 475 122 966 449 Margin518 729 11 651 432 518 729 11 651 432