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Commission adopts first elements of 500 million € package for farmers

01/10/2015


The first elements of the special aid package for EU farmers worth 500 million €, announced by the European Commission in early September (see speeches by Vice-President Jyrki Katainen to the Agriculture Council on 7 September and by EU Agriculture and Rural Development Commissioner Phil Hogan to the Informal Agriculture Council on 15 September), have now been adopted by the European Commission.


Draft rules for most of the other measures have also been presented to Member State experts today and will formally be approved in the coming days and weeks.


The largest part of the package is a targeted aid scheme worth 420 million €, which is allocated to Member States in the form of national envelopes for distribution  mainly to dairy and pigmeat farmers, targeting those sectors that have been most adversely affected by the market situation.


Member States also have the possibility to provide a nationally-funded "top-up" of up to 100% of these amounts. The national top-ups must be used in the same way as the EU funds, ie the Member State cannot use the EU funds for dairy and the top-ups for pigmeat and cereals. Following this condition, national top-ups fall outside the scope of state aid rules.


To aid cash-flow difficulties, the Commission has also published today a new Implementing Regulation which provides more flexibility to Member States to pay out earlier a greater share than usual of the CAP Direct Payments and area related payments from Rural Development.


In addition to this, the Commission has finalised texts related to reinforced Private Storage Aid schemes for certain dairy products to address the market imbalance and increased funding for promotion especially on non-EU markets (+30 million €).


Furthermore, the Commission continues to monitor closely the pigmeat market and is ready to activate an enhanced Private Storage Aid scheme for pigmeat.


In a further initiative, led by DG ECHO, the Commission is moving to provide 30 million € to support the nutritional requirements of refuges within the EU.


Commissioner Phil Hogan said today: "As part of this package is aimed at addressing the more short-term cash-flow problems that many farmers face, I am delighted that we have been able to move so quickly. It is now up to national administrations to ensure that objective criteria are defined and the funds are able to reach farmers without delay."  

 

Background

A series of "Implementing" and "Delegated" Acts relating to these measures will be adopted in due course, following consultation in the relevant Committee and expert group meetings.


Improved private storage aid (PSA) scheme for skimmed milk powder (SMP)

In addition to the existing PSA schemes for butter and SMP, the Commission will open an enhanced scheme to alleviate pressure on the supply side of the market more effectively. This is a new tool, using PSA to guarantee that surplus products are effectively kept out of the market for a sufficiently long period to enable the market to recover. This scheme applies to SMP only (as the butter market is suffering less from market disturbance).

This is an Implementing Regulation (supported by Member States in a vote in the October 1 CMO Committee) which will be adopted by the Commission in the coming days and enter into force immediately.

 

Targeted aid

From an overall budget of 420 million  € from the CAP budget, financial envelopes will be provided to Member States so that they can effectively help their most affected livestock farmers on the basis of objective and non-discriminatory criteria. The distribution among Member States is based on national milk quotas (2014-15), with additional amounts to reflect those with lower prices, those more affected by the Russian embargo, and further amounts reflecting feed crop problems related to drought. Member States also have the possibility to provide a nationally-funded "top-up" of up to 100% of these amounts. The national top-ups must be used in the same way as the EU funds, ie the Member State cannot use the EU funds for dairy and the top-ups for pigmeat and cereals. Following this condition, national top-ups fall outside the scope of state aid rules..  

This is a Delegated Regulation with urgency procedure (based on Article 219 of Regulation 1308/2013), which was discussed with Member State experts today (October 1) and will be adopted by the Commission in the coming days. It will come into force immediately, but can subsequently be challenged by the EP or the Council.

 

 

 

Private storage aid (PSA) for cheese

To help cheese makers who need more time to secure new market outlets and to relieve pressure on the dairy supply side, private storage aid is proposed for 100 000 t of cheese. Learning from last year's experience, the proposed scheme foresees a breakdown of the total volume per Member State based on their respective cheese production.

This is a Delegated Regulation with urgency procedure (based on Article 219 of Regulation 1308/2013) which was discussed with Member State experts today (October 1) and will be adopted by the Commission in the coming days. It will come into force immediately, but can subsequently be challenged by the EP or the Council.

 

 

 

Increased rate of advances for CAP Direct Payments and certain Rural Development measures

In order to address cash-flow problems, the Commission is raising the amount of CAP funds that can be paid early to farmers (from 16 October onwards) for CAP direct payments (from 50% to 70%) and area-based and animal-related Rural Development measures (from 75% to 85%) from 1 October. Under current rules, advance payments can only be made after the verification of the eligibility conditions has been finalised for all farmers, meaning administrative checks and on-the-spot checks. By way of derogation, advances may be paid after administrative checks have been finalised.

This is an Implementing Regulation derogating from the Article 75 of Reg. (EU) No1306/2013 supported by Member States in a vote in the Direct Payments Committee last week and published as Commission Implementing Regulation 2015/1748 in the Official Journal today (1 October).

 

Increase of the total amount of the Annual Work Programme 2016 for promotion measures

As a more medium-term measure to support the agri-food sector's attempts to find new markets, the Commission is increasing the available budget for promotion programmes in 2016 by 30 million € for dairy and pigmeat programmes with 70% of this targeted at export markets.

This will coincide with the new Promotion policy (Regulation 1144/2014), which enters into force on 1 December 2015. The new policy will makes the following changes: the general EU-co-financing rates go up from 50% to 70-80%; the scope of eligible products is widened to all Annex I products (apart from  tobacco); compared to the current policy framework the promotion of generic pigmeat on the internal market may now also benefit from EU support; new types of beneficiaries (e.g. producer organisations) are eligible for support; and the annual budget will more than triple from 60 million € to 200 million € in 2019. 

This is an Implementing Regulation (supported by Member States in a vote in the CMO Committee on 29 September) which has been adopted by the Commission today (1 October) and enters into force immediately.

 

 

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