7.3.87 Official Journal of the European Communities No C 59/5 
II 
(Preparatory Acts) 
COURT OF AUDITORS 
OPINION No 1/87 
of the Court of Auditors of the European Communities on the Council's proposal for a Regu­
lation amending Regulation (EEC) No 1883/78 laying down general rules for the financing of 
interventions by the European Agricultural Guidance and Guarantee Fund, Guarantee Section 
(87/C 59/05) 
THE COURT OF AUDITORS OF THE EUROPEAN 
COMMUNITIES, 
Having regard to the Treaty establishing the European 
Economic Community, and in particular Articles 5, 199 
and 209 thereof, 
Having regard to the Financial Regulation of 21 
December 1977 applicable to the general budget of the 
European Communities, and in particular Articles 1, 4 
and 5 thereof, 
Having regard to the proposal by the Commission ('), 
Having regard to the Council's request of 20 January 
1987 for an opinion on that proposal (2), 
Whereas the Commission's proposal concerns the 
disposal during 1987 and 1988 of surplus intervention 
stocks; 
Whereas it is not clear whether the Commission's 
proposal would cost less than the cost of destroying the 
stocks; 
Whereas the main stated objective of the proposal for a 
Regulation is to postpone until 1989-1992 the question 
of charging the costs corresponding to losses incurred by 
the present draft programme for the disposal of stocks in 
1987-1988 to the budget and, in so doing, to give the 
impression that a balance exists between the revenue and 
expenditure for these financial years; 
Whereas the proposal to delay reimbursement to later 
years will certainly release budget appropriations of 
1 134 million ECU which have already been included in 
the 1987 budget to meet the cost of the programme for 
disposal of surplus butter; Whereas there is no mention of this fact in either the 
preamble or the text of the draft Regulation, and the 
Commission, furthermore, has not taken the initiative by 
proposing the requisite amendments to the budgetary 
authority; 
Whereas the procedures for the specific disposal 
programme proposed by the Commission do not allow 
either the total cost of the measures envisaged or their 
cost per financial year to be clearly identified in the 
accounts; 
Whereas the Commission has estimated that the short-
term savings arising from the proposal will amount to 
1 134 million ECU in each of the years 1987 and 1988, 
i.e. to two thirds of the Commission's estimate of the 
total cost of the additional programme; 
Whereas this proposal conflicts with the principle of the 
annuality of the budget, as laid down in Article 199 of 
the Treaty and Article 1 (2) and Articles 4 and 5 
(subparagraph 5) of the Financial Regulation, which 
stipulate that expenditure must be entered in the 
accounts for the financial year during which it was 
incurred; 
Whereas, moreover, this proposal is in practical terms 
tantamount to creating a new type of repayable loan, 
and one which will, in addition, be interest-bearing and 
will amount to 3,2 thousand million ECU, even though 
the Community balance sheet is already burdened with 
750 million ECU of repayable loans granted by the 
Member States to finance the 1984 budget; 
Whereas, in its opinion No 1/84 of 7 June 1984 (3) the 
Court has already clearly condemned recourse to 
repayable interest-bearing loans as a means of 
Community financing; 
Whereas recourse to multifarious kinds of loans for the 
purpose of balancing the budget undermines the financial 
autonomy of the Communities and is inconsistent with 
the decisions of 21 April 1970 and 7 May 1985 on the 
Communities' own resources; 
(') Doc. COM(87) 6 final of 19. 1. 1987. 
O Decision of 20. 1. 1987. O OJ No C 228, 30. 8. 1984. 
No C 59/6 Official Journal of the European Communities 7.3.87 
Whereas, finally, contrary to what is stated in the 
proposal, it is by no means certain that the measures 
taken at the end of 1986 to reduce milk production will 
allow sufficient resources to be released, from 1989 
onwards, both to finance the normal expenditure 
incurred during these financial years and also to honour 
the repayment commitments entered into by the 
Communities with the Member States as a result of this 
proposal, HAS ADOPTED THE FOLLOWING OPINION: 
The Court of Auditors, for the reasons stated in the 
preamble, cannot agree to the proposal for a Regulation 
submitted by the Commission to the Council. 
This opinion was adopted by the Court of Auditors at its 
meeting on 18 February 1987. 
For the Court of Auditors 
Marcel MART 
President