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COMMISSION OF THE EUROPEAN COMMUNITIES 
COM(94) 472 final 
Brussels, 03.11.1994 
REPORT FROM THE COMMISSION TO THE COUNCIL 
concerning application of Council Regulation (EEC) No 2990/82 on the 
sale of butter at reduced prices to persons receiving social assistance 
Proposal for a 
COUNCIL REGULATION (EC) 
amending Regulation (EEC) No 2990/82 on the sale of butter 
at reduced prices to persons receiving social assistance 
(presented by the Commission) 
-• 1 -
1. Background 
The market situation for milk in general and for butter in particular has 
in the past required a whole range of disposal measures notably for 
butter in order to increase the internal and external sales and 
consequently diminish the purchases into public intervention storage. 
The scheme allowing for sale of butter to persons receiving social 
assistance has been in operation since 1978 and Article 3a of council 
Regulation (EEC) No 2990/82, last modified by Regulation (EEC) 
No 3654/92, requires that the Council, on the basis of a report from the 
Commission before 31.12.1994, decides whether the subsidized sales under 
above mentioned regulation is to be continued. Reports previously 
forwarded to the Council, have on 3 occasions resulted in continuation of 
the scheme for consecutive two year periods ending 31.12.1994. Up until 
now the Regulation has only been applied in Ireland, and.the following 
therefore refers to this Member state. 
2. criteria for the determination of entitlement 
Persons entitled to benefit from the scheme are those in receipt of 
social assistance payements as defined in Part III, Section 118 of the 
Social Consolidation Act 1993. This covers the following schemes operated 
by the Irish Department of Social Welfare and Department for health : 
old Age Pensions 
Unemployment Assistance 
Widows' and Orphans' Pension 
Deserted Wife's Allowance 
Social Assistance Allowance for Unmarried Mothers 
Prisoner's Wife's Allowance 
Carer's Allowance 
Blind Pension 
Social Welfare (Supplementary Welfare) Allowance 
Disabled Persons (Maintainance) Allowances 
Infectious Diseases (Maintenance) Allowance 
Pre-retirement allowances, Carer's allowance, Blind Pension 
3. Procedure for implementation and control of the scheme 
A system of vouchers entitling two pounds of butter per month to be 
purchased at the normal retail price, less the amount of the subsidy, are 
supplied to those persons determined under the criteria set out at point 
2 above. Vouchers are also supplied for each qualified dependent of the 
social assistance recipient. Vouchers are valid for the month they are 
issued and the following two months. 
The system of control involves checks of water marked and security 
printed vouchers, numbers, amounts, quantities and eligibility of the 
numbered vouchers. These checks will, together with declarations from 
the retailers selling the butter and on the spot checks carried out by 
the competent authorities, ensure that the scheme is not abused. 
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4. Developments in the butter and yellowfat market in Ireland 
In accordance with Article 4(3) of Regulation (EEC) n" 1898/87 the Member 
States shall forward to the commission information concerning the 
developments on the butter and yellow fat market. 
The information received from the Irish authorities concerning 
developments in market shares of butter, low-fat butter, margarine and 
fat mixtures shows the following development between 1987 and 1993. 
Butter Low-fat butter Margarine Pat 
Mixtures Total 
Year tonnes (%) tonnes (%) tonnes r%; tonnes r%; tonnes 
1987 20,500 (42,4%) 
1988 16,325 (33,8%) 
1989 13,235 (27.4%) 
1990 12,000 (25.3%) 
1991 11,900 (24.6%) 
1992 11,800 (25.0%) 
1993 11,700 (24.8%) 2,000 (4,1%) 
2,750 (5,7%) 
1,860 (3,9%) 
1,575 (3,3%) 
1,575 (3,3%) 
1,575 (3,3%) 
1,575 (3,3%) 14,900 (30,8%) 
14,200 (29,4%) 
15,700 (32.5%) 
15,100 (31.8%) 
14,600 (30,9%) 
13,900 (29,5%) 
13,700 (29,1%) 11,000 (22,7%) 
15,000 (31,1%) 
17,500 (36,2%) 
18,825 (39.6%) 
19,100 (40.4%) 
19,700 (41.8%) 
20,000 (42.5%) 48,400 
48,275 
48,295 
4 7,500 
48,300 
4 7, 100 
47, 100 
It is noted that the total yellow fat market between 1987 and 1993 shows a 
decline of 1,9% while the fat mixtures have taken a continuing higher 
market share compared to that of butter. The fat mixtures generally 
contain butter or cream and vegetable fat and have been principally 
marketed on the basis of improved spreadability vis-à-vis butter. The 
introduction of reduced and low-fat butters, which incorporate additional 
milk protein and moisture to reduce the overall fat has also led to a 
reduction of the market share of full fat butter. However, it is noted 
that the important yearly decline in the consumption of full fat butter 
experienced in the 1980*s is less significant since 1990. 
5. Developments of sales, financial costs and number of beneficiaries 
Ireland has operated the aid scheme as provided for in the above mentioned 
Regulation since 1978 and the scheme has especially during the last years 
accounted for important shares of the declining internal Irish butter 
consumption. In 1993 the purchase of around 7.424 tonnes of butter was 
aided under the scheme and the estimated purchases for 1994 are 7.500t. 
In 1993 the purchases amounted to more than 60 % of the total Irish butter 
consumption but accounted for less than 6% of the production and it is 
expected that these percentages remain practically unchanged in 1994. The 
maximum aid reimbursed by EAGGF amounts at present to 140 ECU/100 kg 
resulting in total estimated cost of 10,4 MECU in 1993 and 10,5 MECU in 
1994 without taking the monetary adjustment coefficient into 
consideration. 
- 3 -
The development in purchases, financial EAGGF costs and number of 
beneficiaries since 1978 is indicated below : 
Purchases Financial Costs Beneficiaries 
(in tonnes) (MECU) 
1978 66 0.05 n.a. 
1979 3.704 2.96 n.a. 
1980 3.958 3.17 419.000 
1981 3.825 3.06 431.000 
1982 4.080 3.26 543.000 
1983 4.892 3.91 569.000 
1984 4. 122 3.30 617.000 
1985 5.785 4.63 650.000 
1986 5.189 4.15 642.000 
1987 5.651 10.06 720.000 
1988 6.178 11.00 720.000 
1989 6.567 9.85 720.000 
1990 6.182 8.40 720.000 
1991 6.260 9.39 740.000 
1992 7.331 11.00 776.000 
1993* 7.424 10.36 834.000 
1994* 7.500 10.50 800.000 
* = Provisional 
6. conclusions and recommendations 
The application of Council Regulation (EEC) No 2990/82 in Ireland has 
continued to be a successful means in maintaining sales to the social 
assistance categories indicated under point 2 (who in the normal course of 
events would for economic reasons be in the forefront of change to cheaper 
substitutes) . 
A reduction in consumption by these categories of consumers could result 
in sales of butter into intervention. Furthermore, a withdrawel of this 
long standing benefit from the less well off sectors of society e.g. 
unemployed persons, old age pensioners, etc. could hardly be defended from 
a social, market or economic point of view, as well as the favourable 
public perception of a Community scheme promoting butter sales should not 
be neglected. 
The commission therefore proposes a continuation of the scheme for an 
additional two years ending 31 December 1996. Taking account, however, of 
the policies which the Council has been following with regard to the 
intervention price for butter which result in reduction in market prices, 
it is proposed to reduce the aid level by 25 ECU/100kg to 115 ECU/100kg as 
from 1.1.1995. 
H 
Proposal for a 
COtraCn* REGULATION t EC) 
amending Regulation (EEC) Bo 2990/82 on the sale of butter 
at reduced prices to persons receiving social assistance 
THE COUNCIL OF THE EUROPEAN UNION, 
Having regard to the Treaty establishing the European Community, 
Having regard to Council Regulation (EEC) No 804/68 of 27 June 1968 on the 
common organization of the market in milk and milk products^*), as last 
amended by Regulation (EEC) No 1880/94<2), and in particular Article 12(2) 
thereof, 
Having regard to the proposal from the Commission, 
Whereas Council Regulation (EEC) No 2990/82(3), as last amended by 
Regulation (EEC) No 3654/92<4), introduces arrangements, expiring on 
31 December 1994, for the sale of butter at reduced prices to persons 
receiving social assistance; whereas, as provided for in Article 3a(3) of 
that Regulation, the council is to examine before that date and on the basis 
of a report from the Commission the possibility of renewing the arrangements 
laid down; whereas, as a result of the report submitted by the Commission 
and the results obtained, the abovementioned arrangements should be extended 
for a period of two years; whereas, in view on the one hand of experience 
gained and on the other hand of the situation on the market for butter, the 
aid should be reduced, 
HAS ADOPTED THIS REGULATION: 
(1) OJ No L 148, 28.6.1968, p. 13. 
(2) OJ No L 197, 30.7.1994, p. 21. 
(3) OJ No L 314, 10.11.1982, p. 26. 
(4) OJ No L 370, 19.12.1992, p. 1. 
5 
Article 1 
Regulation (EËC) No 2990/82 is hereby amended as follows: 
1. In Article 1, "31 December 1994" is replaced by "31 December 1996". 
2. In Article 3, "140 ECU" is replaced by "ECU 115". 
3. In Article 3a(3), "31 December 1994" is replaced by "31 December 1996". 
Article 2 
This Regulation shall enter into force on the third day following its 
publication in the official Journal of the European Communities. 
This Regulation shall be binding in its entirety and directly applicable in 
all Member States. 
Done at Brussels, For the Council 
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FINANCIAL STATEMENT 
1. BUDGET HEADING: Chapter Bl-2049 APPROPRIATIONS: ECU 15 million 
(199S APB) 
2. TITLE: Proposal for a Council Regulation amending Regulation (EEC) No 2990/82 on the sale of butter at 
reduced prices to persons receiving social assistance 
3. LEGAL BASIS: Article 12(2) of Regulation (EEC) No 804/68 
4. AIMS OF PROJECT: 
To extend the arrangements for selling butter at reduced prices to persons receiving social assistance, at 
a reduced rate of aid 
5. FINANCIAL IMPLICATIONS 
S.O. EXPENDITURE 
- CHARGED TO THE EC BUDGET 
(REFUNDS/INTERVENTIONS) PERIOD OF 12 MONTHS 
+ECU 13.9 million CURRENT FINANCIAL 
YEAR 
(1994) FOLLOWING FINANCIAL 
YEAR 
(1995) 
+ECU 8.7 million 
1996 
S.0.1. ESTIMATED EXPENDITURE +ECU 13.9 million 1997 
+ECU 5.2 million 1998 
5.2. METHOD OF CALCULATION: 
12 months: 10 000 t x ECU 1150/t x 1.207 (DT) = + ECU 13.9 million (B) 
1995 : 10 000 t x ECU 1150/t x 7.5/12 X 1.207 (DT) = + ECU 8.7 million (3) 
6.0. CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE RELEVANT CHAPTER OF THE CURRENT BUDGET? 
YES 
6.1. CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF THE CURRENT BUDGET? 
6.2. IS A SUPPLEMENTARY BUDGET NECESSARY? 
6.3. WILL FUTURE BUDGET APPROPRIATIONS BE NECESSARY? 
COMMENTS: 
The 1995 preliminary draft Budget was established on the assumption that the arrangements would be extended 
beyond 31 December 1994 for 10 000 tonnes at a reduced rate of aid to take account of the reduction in the 
intervention price for butter in 1994. 
ISSN 0254-1475 
COM(94) 472 final 
DOCUMENTS 
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Catalogue number : CB-CO-94-497-EN-C 
ISBN 92-77-815513 
Office for Official Publications of the European Communities 
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