GLOSSARY

CAP : Common agricultural policy

CMEF : Common monitoring and evaluation framework

EAFRD : European Agricultural Fund for Rural Development. The EAFRD is the main financial instrument of the RD policy. The EAFRD is, along with the EAGF (European Agricultural Guarantee Fund), one of the two financial instruments of the CAP.

EU : European Union

Forestry holding : One or more parcels of forest and other wooded land which constitutes a single unit from the point of view of management or utilisation.

Industrial round wood : All wood removed from the forest not used for fuel. It includes two main botanical types, namely coniferous and non-coniferous (broadleaved) species.

Measure : The basic unit of programme management, consisting of a set of similar operations and disposing of a precisely defined budget.

Measure 122 : Rural development measure for the improvement of the economic value of forests

Need : An opportunity or difficulty relevant for concerned groups or regions, which the public intervention aims to address. Ex ante evaluation verifies whether the needs put forward to justify an intervention are genuine.

Operation : Investment project selected according to criteria and implemented by the beneficiary

RDP : Rural development programme. A document prepared by Member State or region, and approved by the Commission, to plan the implementation of the RD policy.

RD policy : Rural development policy

SFC : Standing forestry committee

SWOT-analysis : Analysis of strengths, weaknesses, opportunities and threats. It aims to develop, review and update strategy and planning taking into account the needs of stakeholders and available resources.

Thematic axis : A coherent group of measures with specific goals resulting directly from their implementation and contributing to one or more of the objectives of the support for rural development.

EXECUTIVE SUMMARY

I. In the EU the total area of forests and other wooded land accounts for 177,8 million hectares, while forestry and downstream manufacturing activities provide employment to millions of people. In the period 2007–13, the European Agricultural Fund for Rural Development finances a series of measures to support the development and exploitation of forests.

II. The measure "Improvement of the economic value of forests" (measure 122) grants financial aid for forests owned by private owners or their associations or by municipalities or their associations to support operations for the improvement of the economic value of forests concerning investments at the level of the forestry holding.

III. The total EAFRD support programmed for the measure amounts to 534,72 million euro in the period 2007–13. A similar support is proposed to be maintained for the next programming period 2014–20.

IV. The main objective of the audit was to assess whether rural development support for the improvement of the economic value of forests is managed efficiently and effectively. In doing so the Court assessed (a) whether the design of the measure is adequate, (b) whether the implementation process is appropriate and (c) whether the assessment of the effectiveness of the measure is satisfactory.

V. The audit covered both the Commission and selected Member States (Spain (Galicia), Italy (Tuscany), Hungary, Austria and Slovenia) accounting for more than 50 % of the total expenditure declared.

VI. The Court concludes that the Commission and the Member States did not manage the audited aspects of the support for the improvement of the economic value of forests efficiently and effectively.

VII. The Court’s audit revealed weaknesses in the design of the measure which significantly hinders its successful implementation: at the Commission level, the situation in the forestry sector in the EU was not specifically analysed so as to justify the proposal of specific financial support for improving the economic value of forests of private owners or municipalities. Furthermore, key features of the measure were not defined in the legal provisions, particularly the meaning of "economic value of forests" and what is a "forestry holding". Moreover, Member States set very different sizes of forest holdings above which a forest management plan was required.

VIII. At the Member States’ level the needs were not adequately described in the RDPs and several Member States discontinued the measure or reallocated most of the allocated amounts in favour of other measures.

IX. The Court also found that, in certain respects, the implementation process was not appropriate: depending on the Member State approach, many of the projects subsequently funded are not in line with the measure’s provisions. Moreover, Member States supported under measure 122 operations which do not correspond to the objectives of the measure and which would be more appropriately financed by other measures with different eligibility requirements and aid financing rates, usually lower. As not all the investments per se increase the economic value of forests, the inherent link between the aid granted and a possible improvement of the economic value of a forest varies depending on the typology of the investment.

X. The Court considers that the assessment of the effectiveness of the support was not satisfactory: Member States did not determine or require beneficiaries to determine the value of the forest areas prior to and after the investments.

XI. In terms of monitoring, the CMEF is inadequate to appraise the impact of the financial support under measure 122 because the performance indicators and evaluation questions included in the CMEF do not allow a determination of whether the funded investments resulted in an improvement of the economic value of the forests where they were carried out.

XII. The Court found that only a few of the audited projects improved significantly the economic value of the forests, either by improving the value of the land (building of forest tracks and roads) or the value of the stands (silvicultural operations like pruning or thinning).

XIII. With regard to the above conclusions and to the fact that the audited support is proposed to be maintained for the next programming period 2014–20, the Court recommends that:

- The Commission should:

(i) define and assess the EU needs for improving the economic value of the forests;

(ii) clearly define the key features that would ensure that the EU support is targeted to address those needs, and thus create EU added value.

- The Member States should:

(i) adequately describe in their RDPs the specific economic needs and opportunities of the different types of forest areas and beneficiaries;

(ii) enhance forest management by providing for the elaboration of forest management plans for the bulk of forest holdings and the promotion of certification of forest areas.

- The Member States should:

(i) set adequate requirements to ensure that forestry support within the rural development policy is consistent, in line with state aid provisions and maximises its effectiveness;

(ii) put in place adequate procedures to ensure that support is effective so as to actually increase the economic value of the forest areas where the investments take place.

- The Commission should improve its monitoring of the measure to ensure that the Member States implement it in line with the specific objectives set. In concrete terms, the Member States should require beneficiaries to provide details of the value of their forest areas both prior to and after the aided investments and managing bodies should be required to validate these values.

INTRODUCTION

FORESTRY IN THE EU

1. In the EU the total area of forests and other wooded land accounts for 177,8 million hectares which is about 40 % of the total EU land area and similar to the land area used for agricultural purposes [1] (183,9 million hectares). Germany, Spain, France, Finland and Sweden collectively accounted for more than three fifths of the wooded land in the EU. Graph 1 shows the distribution of the wooded land in the EU and its importance compared to the agricultural land in each Member State.

GRAPH 1

FOREST AND OTHER WOODED LAND VS AGRICULTURAL LAND IN THE EU-27

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Source: Eurostat.

2. In 2009, the EU accounted for about 12 % of the world’s wood production [2] with 392,9 million m3 of wood removed from its forest and wooded areas. Forestry,logging and related service activities cover the production of timber, as well as the extraction and gathering of wild growing forest products. In addition to industrial roundwood [3], forestry produces wood for fuel. In certain regions non-wood goods [4] can also be an important source of local income.

FOREST OWNERSHIP

3. With some 16 million private forest owners, this category represents around 60 % of EU forestry ownership. Private forest holdings have an averagesize of 13 hectares, but the majority of privately owned forests are smaller than five hectares [5]. It is estimated that individuals and families own around 80 % of forest areas in private ownership and the rest is owned by private institutions and companies [6]. The area of privately owned forest has increased in recent years, and is still increasing, due principally to afforestation of agricultural land and, in eastern Europe, to privatisation of formerly nationalised forest land [7].

4. On the other hand, around 40 % of the forest area in the EU is publicly owned. Public ownership of forests comprises national, regional or provincial bodies, state-owned enterprises and municipalities. It is estimated that municipal forests cover less than 15 % of the total area of publicly owned forests [8]. The overall publicly owned forest area decreased by around 3 % between 2000 and 2010. Around 75 % of forests in Bulgaria, Czech Republic, Greece and Poland are in public ownership. Graph 2 shows the distribution between public and private ownership of forests in each Member State [9].

GRAPH 2

FOREST OWNERSHIP IN THE EU

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Source: Eurostat.

EU FORESTRY POLICY AND SUPPORT: HISTORICAL BACKGROUND

5. Until 1992, forestry-related EU actions were linked to agricultural policy. At that time, a key priority was the development and exploitation of forestry activities on farms so as to offer an alternative activity and income to those engaged in agriculture [10]. Since 1992, forestry support has been made available not only to farmers but also to other private persons and to local authorities [11].

6. In 1998, a Council resolution on a "Forestry Strategy for the European Union" [12] established a strategic framework for forest-related actions in support of sustainable forest management and the multifunctional role of forests based on the coordination of the forest policies of the Member States and the Union.

7. In 2006, the Commission in cooperation with the Member States prepared an "EU Forest Action Plan" [13] aimed at providing a framework for the implementation of forest-related actions at Union and Member State level. In this plan, it is provided that the Member States may encourage investments to enhance the economic value of forests to strengthen the competitiveness and economic viability of forestry [14].

THE RURAL DEVELOPMENT POLICY 2007–13

8. The RD policy is implemented through multi-annual programming periods [15] and is focused on three core objectives [16], known as "thematic axes", to be achieved through a series of financial support measures:

improving the competitiveness of the agricultural and forestry sector ("Axis 1");

improving the environment and the countryside ("Axis 2");

improving the quality of life in rural areas and encouraging diversification of the rural economy ("Axis 3").

The rural development measures applicable to the forestry sector are mainly under axis 1 and 2 [17].

MEASURE 122: IMPROVEMENT OF THE ECONOMIC VALUE OF FORESTS

9. Measure 122 "Improvement of the economic value of forests" [18] is the only forestry-specific measure defined under Axis 1 (improving the competitiveness of the agriculture and forestry sector). Measure 122 is included in 49 rural development programmes drawn up by 17 Member States [19]. The total EAFRD support programmed for actions under the measure amounts to 534,72 million euro in the period 2007–13 while EAFRD payments corresponded to 137,13 million euro (see Annex I for details on the allocation of financial resources for measure 122 and the amount of forest areas in private ownership by Member State).

10. The responsibility for the sound financial management of the budgetary expenditure for the measure "Improvement of the economic value of forests" is shared between the Commission and the Member States.

11. In the framework of this measure, EAFRD financial investment support can be granted for forests owned by private owners or their associations or by municipalities or their associations [20]. Support is excluded for forests and other wooded land owned by central or regional governments, or by government-owned corporations, or owned by the Crown, or by legal persons at least 50 % of whose capital is held by those entities [21]. It is expected that around 88000 private or municipal forest owners will benefit [22] from the measure. As of 31 December 2011, a total of 20662 investment projects had been approved by 15 Member States.

12. According to the legal basis, supported operations for the improvement of the "economic value of forests" concern investments at the level of the "forestry holding" and may include investments for "harvesting equipment", while activities related to regeneration after final felling are excluded from support [23]. Investments have to be based on "forest management plans" for forest holdings "above a certain size" defined by the Member States in their programmes. The financial support is limited to 50 % of the amount of eligible investment, which is increased to 60 % in less-favoured areas [24].

AUDIT SCOPE AND APPROACH

13. The audit focused on the design and implementation of rural development support under measure 122 "Improvement of the economic value of forests". The main objective of the audit was to assess whether rural development support for the improvement of the economic value of forests is managed efficiently and effectively.

14. More specifically, the audit focused on the following issues:

(a) Is the design of the measure adequate?

(b) Is the implementation process appropriate?

(c) Is the assessment of the effectiveness of the measure satisfactory?

15. The audit covered both the Commission and selected Member States. At the level of the Commission the audit work covered the design of the measure and its management activities, including approval of the RDPs submitted by the Member States and monitoring of the financial support under the measure. At the level of Member States, the Court’s audit included visits to Spain (Galicia), Italy (Tuscany), Hungary, Austria and Slovenia. These Member States accounted for more than 50 % of the total expenditure declared for measure 122 in the current programming period 2007–13.

16. The audit work comprised interviews with the responsible managing authorities, a review of the RDPs and the relevant national or regional legislation and procedures, in particular those for selecting investment projects. A sample of 50 supported projects was visited on the spot to verify the effects of the investments (see Annex II for details).

17. In addition, the Court sent questionnaires to two Member States that have opted not to implement the measure even though their forestry sector is very important (Finland and Sweden) and to three Member States that had declared no expenditure or a very limited one by the end of 2010 though they initially planned large amounts of expenditure under the measure (Bulgaria, Greece and Romania).

OBSERVATIONS

SIGNIFICANT WEAKNESSES IN THE DESIGN OF THE MEASURE

WEAKNESSES IN THE OVERALL JUSTIFICATION OF THE MEASURE

18. The audit examined whether there was adequate justification supporting the design of the measure and its proposal.

19. In the preamble to the regulation [25] it is stated that private forests play an important role in economic activity in rural areas and, therefore, EU aid is important for improving and broadening their economic value, for increasing diversification of production and enhancing market opportunities, in sectors such as renewable energy, while maintaining the sustainable management and the multifunctional role of forests. The preamble to the regulation makes no explicit mention of forests owned by municipalities.

20. The audit did not find any specific Commission SWOT analysis [26] of the situation in the forestry sector at EU level justifying the proposal of specific financial support for improving the economic value of forests of private owners and municipalities or defining the public interest to which such a support should respond.

21. To justify measure 122 the Commission services subsequently referred to Standing Forestry Committee’s opinions and reports, [27] which they considered would justify the proposal of measure 122. However none of these opinions was available to the Commission before the release of its proposal [28] to the Council on support for rural development by the EAFRD, which suggests a lack of due preparation.

22. Municipalities may in some cases be responsible for the management of forests owned by other local authorities. For example, in Tuscany, the region delegated to the municipalities the management of regional forests. Although there was in practice no difference for a municipality between the management of its own forests and the management of entrusted regional forests measure 122 could not be applied in regional forests, which suggests some incoherence in the measure.

KEY FEATURES NOT SUFFICIENTLY DEFINED

ECONOMIC VALUE OF FORESTS

23. The regulations do not lay down a definition of "economic value of forests" which the measure 122 is intended to improve, although a clear definition is essential in order to assess whether the projects funded have actually increased or not the economic value of the forests supported under the scheme [29] (see paragraph 49). According to Eurostat [30] the economic value of a forest comprises essentially the value of the land and the value of the stock of wood growing on it. However, as for both these values the most objective measurement tool is the market price, the market value of a plot of woodland may vary widely depending on factors such as growing capacity of the soil, the tree species composition, age of the stand, location, access and other factors. Furthermore, such values are not readily available.

SIZE OF FORESTRY HOLDING IN COMPARISON WITH THE SUPPORT RECEIVED

24. According to the legal basis, operations for the improvement of the economic value of forests concern investments at the level of the forestry holding but the term "forestry holding" is not further defined. Following the definition of the United Nations Economic Commission for Europe (UNECE) "holding" means one or more parcels of forest and other wooded land which constitute a single unit from the point of view of management or utilisation [31]. In view of the above, the Court considers that support should be adjusted to the particular needs of a beneficiary taking into account the size of his/her forestry holding. The audit found several cases (Hungary and Slovenia) of support paid for the acquisition of new machinery and equipment which exceeded any possible utilisation the beneficiary could make of them in its forestry holding (e.g. see paragraph 33) [32].

SIZE OF THE BENEFICIARY

25. According to the legal basis support in the forestry sector should avoid any negative effect on competition [33]. For other forestry measures (such as the forestry component of measure 123 [34]) support is limited to microenterprises [35]. As such a condition is not foreseen for measure 122 the absence of any preventive restriction in terms of size, main economic activity or legal status of the beneficiary could reinforce the market position of large enterprises [36].

FOREST MANAGEMENT PLANS

26. According to the legal basis, investments shall be based on forest management plans for forest holdings above a certain size to be defined by the Member States in their programmes [37]. The audit found that Member States set very different sizes of forest holdings above which a forest management plan was required and that in a Member State (Austria) 99 % of private forest owners were exonerated from that obligation [38].

HARVESTING AND REGENERATION AFTER FINAL FELLING

27. According to the legal provisions [39], supported operations for the improvement of the economic value of forests concern investments at the level of the forestry holding and may include investments for harvesting equipment, while activities related to regeneration after final felling are excluded from support. The Court considers that it does not seem coherent on the one hand to support investment in harvesting equipment and on the other to exclude support for regeneration after final felling.

FOR THE PROGRAMMES AUDITED, THE INITIAL ANALYSIS BEFORE ADOPTION WAS NOT ADEQUATE

28. The EAFRD is implemented in the Member States through RDPs that should include an ex ante evaluation and an analysis of the situation in terms of strengths, weaknesses and identified needs, as well as the strategy chosen to meet them and optimise the allocation of resources.

29. In the RDPs of the five Member States [40] or regions visited, the identification of needs, to the extent that it was undertaken, related to the forestry sector as a whole, which makes it difficult to establish links between particular needs and measures.

30. The audit found that such needs were generally not adequately described in the RDPs (see Box 1). In particular, there was insufficient analysis and justification of priorities of the different types of forest areas and beneficiaries. Moreover, the required description of the economic opportunities was set out in general terms only or even had not been presented at all.

BOX 1

EXAMPLES OF UNCLEAR IDENTIFICATION OF NEEDS IN THE RDPS OF THE MEMBER STATES

In Slovenia, low investment capacity was identified as a weakness in the forestry sector, however there was not a separate analysis of needs in respect of type of beneficiaries, be these enterprises, legal entities or physical persons. As a consequence the Court found that also forestry enterprises with high investment capacity could benefit from significant amounts of public support.

In Austria, the RDP does not set out which weaknesses of the forest sector the measure is intended to redress. Although in the RDP there is a quantitative estimation of the areas targeted by the support, it is not explained why those areas require public funding.

31. The Commission approved the rural development programmes although they did not define any specific need of any private forest owners of financial support to improve the economic value of their forests.

32. Bulgaria, Romania and Greece, although they had planned large financial amounts, had not declared any expenditure by the end of 2011(Greece and Romania) or very small amounts (Bulgaria). The Court was informed by these Member States that their managing authorities decided to transfer the amounts of financial resources planned for measure 122 to other measures (Bulgaria and Romania reallocated around 80 % and 33 % respectively of the amounts initially planned), to a later implementation of the measure within the programming period or even to discontinue the measure (Greece).

SIGNIFICANT WEAKNESSES IN THE IMPLEMENTATION HAVING REGARD TO THE OBJECTIVES SET

CASES OF PUBLIC SUPPORT DISPROPORTIONATELY HIGH COMPARED TO REAL NEEDS

33. Regarding the relationship between the size of the forest areas declared by the applicants and the level of public support granted, the audit found that certain Member States (Hungary and Slovenia), while setting relatively high ceilings for public support [41] did not establish any proportionality between the size of the forest areas declared by the applicants and the level of public support which could be granted. In one Member State (Slovenia), a beneficiary having declared three hectares of forest areas was approved for an investment of 1,1 million euro in respect of harvesting and ancillary machinery and received 375000 euro from the EAFRD. Another Member State (Austria) financed until 2009 beneficiaries who were not forest owners for biomass processing investments without requiring them to declare any specific forest area, for example a beneficiary, with no forest land declared was approved for a project of 132000 euro and received 17000 euro from the EAFRD.

34. However in Hungary, the managing authorities changed the eligibility requirements in 2010 to make support proportional to the size of the registered forest areas and limited the aid to a maximum of 115500 euro.

INVESTMENTS NOT CONSIDERED IN LINE WITH THE PROVISIONS OF THE MEASURE

35. Although support under measure 122 may only be provided for investments, the audit found cases of support granted for non-durable goods such as short-cycle consumables (Tuscany) [42] and operating production costs (Austria) [43]. The Court considers that, in general, the acquisition of such non-durable goods is not an investment. Similarly, operating costs cannot be considered as investments.

36. In certain Member States (Hungary and Slovenia, see Annex II) there was no requirement for the beneficiaries to own or rent the forests where grant-aided machines can be used. Investments made by contractors/ service providers cannot be considered as being exclusively for the purposes of a specific forest holding and, as such, cannot be considered as being eligible under the governing regulation (see paragraph 24).

CERTAIN ACTIONS FINANCED UNDER MEASURE 122 WOULD BE BETTER GRANTED UNDER OTHER EAFRD MEASURES

37. EAFRD support is implemented via a multiplicity of measures, amongst which consistency [44] shall be ensured. Given the difference in the maximum aid rate which can be granted depending on the different measures, financing an operation under one measure or another is not neutral in budgetary terms [45]. It should be noted that the audit did not find any case of double financing of the same operation.

38. However, the audit found cases of investments supported by measure 122 which better correspond to the purpose of the measure 121 "Modernisation of agricultural holdings" which supports investments in agricultural holdings to improve their overall performance. For example, in Hungary, the acquisition of agricultural machinery was financed under measure 122. In Tuscany, measure 122 financed the purchase of drying machines for cultivated chestnuts, the renovation of farm buildings not located in woodlands and to be used during harvesting for sorting and temporary storage of chestnuts, as well as the refurbishment of farm premises for storing tools and machines.

39. In Italy, Hungary and Slovenia, forestry enterprises were granted support for the acquisition of machinery to perform operations which use the wood as a raw material prior to its industrial sawing at a sawing mill (felling, stripping, cutting up, transportation) or processing operations (chipping of wood, wood-splitting, production of planks and pallets). In Austria, the construction of warehouses and drying plants and the acquisition of transport containers were supported. The Court considers that these investments do not match so much the objectives of measure 122, but rather those of the measure "adding value to forest products" (measure 123) as the investments concern the wood removed from the forest, not the forest, which is composed of living trees.

NOT ALL THE INVESTMENTS PER SE INCREASE THE ECONOMIC VALUE OF FORESTS

40. The audit found that most of the investments supported by the measure can be grouped in two categories, forestry work and machinery. In the first case (thinning, pruning, etc.), the Court considers that, in general, such works improve the market value of the forest stands: the production of quality wood is strictly related to the density of trees which is improved by the thinning, while pruning is aimed at reducing the number of knots in the planks of timber, which increases its market value (see Box 2).

BOX 2

EXAMPLE OF THE EFFECTS OF FORESTRY WORK FINANCED BY MEASURE 122 (LEFT) COMPARED TO FOREST AREAS WITHOUT ANY FORESTRY CARE (RIGHT)

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41. As to the investments in machinery, the Court considers that the mere fact of acquiring a machine, which can be used in a forest area but also in other areas such as agricultural ones, does not imply per se an increase of the value of any specific forest area belonging to the owner of the machinery. During its audit missions the Court found that many forest owners also have an agricultural activity and that in many cases measure 122 financed the acquisition of machinery which can equally be used for agricultural purposes such as trucks, agricultural tractors, ploughs, harrows, fertilizer spreaders, excavators, etc. (see Box 3).

BOX 3

EXAMPLES OF AGRICULTURAL MACHINERY FINANCED BY MEASURE 122

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THE ASSESSMENT OF THE EFFECTIVENESS OF THE SUPPORT WAS NOT SATISFACTORY

INDICATORS NOT ADEQUATELY MEASURING THE ACHIEVEMENT OF OPERATIONAL OBJECTIVES

42. In accordance with the legislation [46], a "Common Monitoring and Evaluation Framework" (CMEF) has been drawn up in cooperation between the Commission and the Member States. The regulation sets out that the progress, efficiency and effectiveness of rural development programmes in relation to their objectives shall be measured by means of indicators relating to the baseline situation as well as to the financial execution, outputs, results and impact of the programmes [47].

43. Concerning measure 122, the Commission issued guidelines setting as output indicators the "number of forest holdings that received investment support" and the "total volume of investment", and as result indicators the "number of holdings introducing new products and/or techniques" and the "increase in gross value added (GVA) in supported holdings".

44. The Court notes that these output indicators do not measure the achievement of any operational objective, which is an inevitable consequence of the fact that the objectives had not been clearly defined for this measure.

QUESTIONS TO ASSESS THE IMPROVEMENT OF THE ECONOMIC VALUE OF FORESTS SHOULD HAVE BEEN BETTER TARGETED

45. The CMEF also provides for a mid-term evaluation to be carried out in 2010 by independent evaluators. For measure 122 the evaluation questions relate to diversification of production [48], enhancement of market access and market share, sustainable management of forests and competitiveness of forest holdings.

46. The Court considers that none of these questions allows for a comprehensive assessment of whether the measure resulted in any improvement of the economic value of the forest. The questions relating to market share and competitiveness of forest holdings are not relevant to assess the performance of the measure in those beneficiary holdings that do not carry out a commercial activity. Furthermore, the evaluation reports generally refer to replies from beneficiaries to evaluation questionnaires or reproduce global statistical data on the forestry sector, and do not furnish any concrete information on the effects of measure 122 on the economic value of forests.

NO DETERMINATION OF THE VALUE OF THE FOREST AREAS PRIOR TO AND AFTER THE INVESTMENTS

47. The audit found that none of the Member States or regions visited during the audit had established adequate procedures to determine the effect of the actions co-financed by the EAFRD on the economic value of the forest areas (forest land and stands) involved, nor were the beneficiaries required to indicate this. The value of the forest areas prior to the investment was not determined and compared with the situation after the investments financed by the measure. In the absence of such valuations, which are not readily available, it is difficult to determine whether the objectives of the measure have been achieved.

EFFECTIVENESS IN A LARGE NUMBER OF PROJECTS AUDITED IS POOR

48. The Court assessed for 50 projects audited during the audit visits whether they achieved the objectives set by the measure (to improve the economic value of forests).

49. The Court found that only a few improved the economic value of the forests, either by improving the value of the land (building of forest tracks and roads) or the value of the stands (silvicultural operations like pruning or thinning). For the other projects the Court did not find sufficient evidence on their relevance or on their significant contribution to the improvement of the value of forests, as they concerned:

(a) agriculture (fruit chestnuts [49], pastures, short-rotation coppice, agricultural machinery, farm buildings);

(b) processing and marketing of wood (equipment for fuel wood chipping and subsequent drying, or sawing, storehouses, transport containers); and

(c) operating costs for wood production (harvesting, chipping and drying, consumables like overalls, footwear and gloves).

PROGRAMMING PERIOD 2014–20

50. The Commission presented in October 2011 a proposal for a regulation on support for rural development for the programming period 2014–20 [50]. The draft regulation proposes support for investments "related to the improvement of the economic value of forests" to "be granted to private forest owners, municipalities and their associations" [51]. The investments shall be at the level of the forest holding and may include investments for soil and resource-friendly harvesting machinery and practices.

51. In the proposal once again no indication is given why the provision addresses private owners in general, and not specific categories of owners or specific situations of certain private owners.

52. In its Opinion No 1/2012, the Court noted that although in the draft regulation a single measure should cover all types of support for forestry investments, and all relevant sub-measures are mentioned in one single article [52], each of them remains governed by specific requirements and provisions.

53. The Court considers that if the Commission proposal is adopted without any change, the problems noted in this report are likely to persist in the next programming period.

CONCLUSIONS AND RECOMMENDATIONS

54. The specific measure 122 "improvement of the economic value of forests" was introduced in the programming period 2007–13. The Court’s audit revealed deficiencies in terms of the design, implementation and monitoring of the measure. Consequently, the Court concludes that the Commission and the Member States did not manage the audited aspects of the support for the improvement of the economic value of forests efficiently and effectively. With particular regard to the fact that such a support is proposed to be maintained for the next programming period 2014–20, the Court makes the recommendations set out below.

SIGNIFICANT WEAKNESSES IN THE DESIGN OF THE MEASURE

55. The audit identified weaknesses in the design of the measure which significantly hinders its successful implementation, as explained hereunder.

56. The Commission did not specifically analyse the situation in the forestry sector at EU level so as to justify the proposal of specific financial support for improving the economic value of forests of private owners and municipalities or defining the public interest to which such a support should respond (paragraphs 18 to 22).

57. Key features of the measure were not defined in the legal provisions, namely the meaning of "economic value of forests" and what is a "forestry holding". Moreover, there were no particular conditions concerning the size, main economic activity or legal status of potential beneficiaries to avoid risks of potential distortion of competition (paragraphs 23 to 25).

58. Member States set very different sizes of forest holdings above which a forest management plan was required, ranging from a minimum size set so as to increase the forest areas under management plan to such a high threshold that in practice in a Member State (Austria) 99 % of private forest owners were exonerated from that obligation (paragraph 26).

59. Also the needs were not adequately described in the RDPs by the Member States. The audit found several instances of inadequate initial analysis of the specific needs regarding the measure or that the measure did not respond to any specific or urgent needs in Member States (paragraphs 28 to 31). Several Member States discontinued the measure or reallocated most of the allocated amounts in favour of other measures (paragraph 32).

RECOMMENDATION 1

The Commission should:

- define and assess the EU needs for improving the economic value of the forests;

- clearly define the key features that would ensure that the EU support is targeted to address those needs, and thus create EU added value.

RECOMMENDATION 2

Member States should:

- adequately describe in their RDPs the specific economic needs and opportunities of the different types of forest areas and beneficiaries;

- enhance forest management by providing for the elaboration of forest management plans for the bulk of forest holdings and the promotion of certification of forest areas.

SIGNIFICANT WEAKNESSES IN THE IMPLEMENTATION HAVING REGARD TO THE OBJECTIVES SET

60. The audit found numerous weaknesses in the implementation of the measure (paragraphs 33 to 41). Hence the Court concludes that, in certain respects, the implementation process was not appropriate.

61. In particular, the Court found cases of public support which were disproportionately high compared to the real needs (paragraphs 33 to 34). Depending on the Member State approach, many of the projects subsequently funded are not in line with the measure’s provisions, for instance cases were found of support granted for non-durable goods and operating production costs and of aid de facto supporting felling (paragraphs 35 to 36). Furthermore, Member States supported under measure 122 operations which do not correspond to the objectives of the measure and which would be more appropriately financed by other measures with different eligibility requirements and aid financing rates, usually lower (paragraphs 37 to 39).

62. Not all the investments per se increase the economic value of forests. The inherent link between the aid granted and a possible improvement of the economic value of a forest varied depending on the typology of investment (paragraphs 40 to 41).

RECOMMENDATION 3

Member States should:

- set adequate requirements to ensure that forestry support within the rural development policy is consistent, in line with state aid provisions and maximises its effectiveness,

- put in place adequate procedures to ensure that support is effective so as to actually increase the economic value of the forest areas where the investments take place.

THE ASSESSMENT OF THE EFFECTIVENESS OF THE SUPPORT WAS NOT SATISFACTORY

63. As a result of the audit, the Court considers that important shortcomings hindered the assessment of the effectiveness of the support.

64. The CMEF is inadequate to appraise the impact of the financial support under measure 122 because the performance indicators and evaluation questions included in the CMEF do not allow determining whether the funded investments resulted in an improvement of the economic value of the forests where they were carried out (paragraphs 42 to 46).

65. Member States did not determine or require beneficiaries to determine the value of the forest areas prior to and after the investments. The lack of assessments at Member State or regional level on the effective increase of the value of the forests where actions were supported hinders the assessment regarding the achievement of the main objective of the measure, and therefore also the assessment of the effectiveness of the support (paragraph 47).

66. The Court found that only a few of the audited projects improved the economic value of the forests, either by improving the value of the land (building of forest tracks and roads) or the value of the stands (silvicultural operations like pruning or thinning).

RECOMMENDATION 4

The Commission should improve its monitoring of the measure to ensure that the Member States implement it in line with the specific objectives set. In concrete terms, Member States should require beneficiaries to provide details of the value of their forest areas both prior to and after the aided investments and managing bodies should be required to validate these values.

This report was adopted by Chamber I, headed by Mr Ioannis SARMAS, Member of the Court of Auditors, in Luxembourg at its meeting of 12 June 2013.

For the Court of Auditors

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Vítor Manuel da Silva Caldeira

President

[1] DG Agriculture and Rural Development, Agriculture in the EU — Statistical and Economic information 2011, March 2012.

[2] Removals is a common measure of the magnitude of the extraction of wood from forests.

[3] "Industrial roundwood" is intended as all wood removed from the forest not used for fuel.

[4] Forests are a source for products extracted from forests, including resin, tannin, fodder, medical plants, berries, nuts, roots, mushrooms, seeds and honey.

[5] DG Agriculture and Rural Development H4, Report on the implementation of forestry measures under the rural development Regulation 1698/2005 for the period 2007–13, March 2009. Another source indicates that in nine surveyed Member States 61 % of all private forest holdings have an area of less than 1 hectare and 86 % of all holdings belong to the size classes up to 5 hectares (Prospects for market supply of wood and other forest products from areas with fragmented forest-ownership structures — Final study report, BOKU University, Vienna, 2010).

[6] MCPFE Liaison Unit Warsaw, UNECE, FAO, State of Europe’s forests 2007. The MCPFE report on sustainable forest management in Europe, Warsaw, 2007, p. 81.

[7] UNECE, FAO, Geneva timber and forest study paper 20. European forest sector outlook study, Geneva, 2005), p. 115.

[8] MCPFE Liaison Unit Warsaw, UNICE, FAO, State of Europe’s forests 2007. The MCPFE report on sustainable forest management in Europe, Warsaw, 2007, p. 81: "The largest share of public forest is owned by the State (85 %), the rest mainly by cities, townships, municipalities and provincial governments".

[9] Malta does not have wooded land.

[10] Council Regulation (ECC) No 4256/88 of 19 December 1988, laying down provisions for implementing Regulation (EEC) No 2052/88 as regards the EAGGF Guidance Section (OJ L 374, 31.12.1988, p. 25), Council Regulation (ECC) No 1610/89 of 29 May 1989 laying down provisions for implementing Regulation (EEC) No 4256/88 as regards the scheme to develop and optimally utilise woodlands in rural areas in the Community (OJ L 165, 15.6.1989, p. 3), Council Regulation (ECC) No 2328/91 of 15 July 1991 on improving the efficiency of agricultural structures (OJ L 218, 6.8.1991, p. 1).

[11] Council Regulation (ECC) No 2080/92 of 30 June 1992 instituting a Community aid scheme for forestry measures in agriculture (OJ L 215, 30.7.1992).

[12] Council Resolution of 15 December 1998 on a forestry strategy for the European Union (OJ C 56, 26.2.1999, p. 1).

[13] COM(2006) 302 final of 15 June 2006.

[14] COM(2006) 302 final, p. 6.

[15] The Member States are responsible for drawing up rural development programmes and submitting them to the Commission for approval.Member States are also responsible for managing each rural development programme in an efficient and effective way and in particular for selecting operations for funding. The Commission has to approve the RD programmes and check that management and control systems exist and function properly in the Member States (Article 75 of Council Regulation (EC) No 1698/2005 of 20 September 2005 on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) (OJ L 277, 21.10.2005, p. 1)).

[16] Article 4 of Regulation (EC) No 1698/2005.

[17] Measures No 122,123,124,125, 221, 222, 223, 224, 225, 226, 227, as codified in Annex II to Commission Regulation (EC) No 1974/2006 of 15 December 2006 laying down detailed rules for the application of Council Regulation (EC) No 1698/2005 on support for rural development by the European Agricultural Fund for Rural Development (EAFRD) (OJ L 368, 23.12.2006, p. 15).

[18] Article 27 of Regulation (EC) No 1698/2005.

[19] BG, CZ, DE(1), EE, ES(7), FR (5), IT(20), LV, LT, LU, HU, AT, PT(3), RO, SI, SK, UK(2).

[20] Article 27 of Regulation (EC) No1698/2005.

[21] Article 30(4) of Regulation (EC) 1974/2006.

[22] DG Agriculture and Rural Development H4, Report on the implementation of forestry measures under the rural development Regulation 1698/2005 for the period 2007–13, March 2009.

[23] Article 18 of Regulation (EC) No 1974/2006.

[24] Annex I of Regulation (EC) No 1698/2005, "amounts and rates of support".

[25] Recital 22 of Regulation (EC) No 1698/2005.

[26] SWOT-analysis: analysis of strengths, weaknesses, opportunities and threats. It aims to develop, review and update strategy and planning taking into account the needs of stakeholders and available resources.

[27] SFCs opinions to justify the specific needs for investment support under measure 122: (a) SFC opinion on climate change and forestry; (b) SFC opinion on wood mobilisation; (c) SFC opinion on valuation and financing methods for non-wood forest woods and services and; (d) SFC opinion on forestry measures in rural development.

[28] COM(2004) 490 final of 14 July 2004.

[29] Additionally, there is an inherent complexity linked to the fact that the concrete outcomes of most forest investments can only be ascertained in the long term, at which time the value of the forests may depend less on any investments made than on other circumstances or market factors.

[30] Eurostat, The European Framework for integrated Environmental and Economic Accounting for Forests — IEEAF, Office for Official Publications of the European Communities, Luxembourg, 2002.

[31] Source: UNECE/FAO Temperate and Boreal Forest Resource Assessment 2000 (TBFRA-2000) Database.

[32] A number of separated properties managed under one corporate strategy could constitute a forestry holding according to UNECE definition and thus receive as such public support but this was not the case in the audited cases of Hungary and Slovenia.

[33] Preamble (32) of Regulation (EC) No 1698/2005: "This support (in forestry) should avoid distorting competition and should be market-neutral".

[34] Measure "Adding value to agricultural and forestry products" (measure 123), Article 28(3) of Regulation (EC) No 1698/2005: "In the case of forestry support shall be limited to micro-enterprises".

[35] i.e. enterprises which employ fewer than 10 persons and whose annual turnover and/or annual balance sheet total does not exceed 2 million euro.

[36] In their reply to the Court, to the question why they didn’t activate the measure Swedish authorities explained that support for the purpose of increasing production or the real estate value should not be given as it might distort competition between forest owners. By contrast, support is given only for environmental purposes.

[37] Article 27(2) of Regulation (EC) No 1698/2005. Forest management plans appropriate to the size and use of the forest area should be based on relevant national legislation as well as existing land use plans and they should adequately cover the forest resources (Article 18 of Regulation (EC) No 1974/2006).

[38] While in one Member State (Spain) a minimum size of 15 hectares was set so as to increase the forest areas under management plan, in another (Austria), the rural development programme set such a high threshold for a forest management plan to be compulsory, 1000 ha, that in practice 99 % of private forest owners were exonerated from the obligation to produce a forest management plan when claiming aid under measure 122.

[39] Article 18 of Regulation (EC) No 1974/2006.

[40] Galicia (Spain), Tuscany (Italy), Hungary, Austria, and Slovenia.

[41] 500000 euro (SI); 735000 euro (HU — in 2008).

[42] Personal protection equipment such as overalls, helmets, footwear, gloves, first-aid kits, etc.

[43] Support was granted for the partial reimbursement of operating costs for activities related to bio-mass preparation such as transportation, drying and storage.

[44] Article2(1)(b) of Regulation (EC) No 1974/2006.

[45] For example the maximum aid rate for measure 122 is 10 % higher than the maximum aid rate for measure 121 (Modernisation of agricultural holdings) or measure 123 (Adding value to forest products), see Annex of Regulation (EC) No 1698/2005. The general rate for investments under measure 122 is 50 % while for measures 121 and 123 is only 40 %.

[46] Article 80 of Regulation (EC) No 1698/2005.

[47] Article 81 of Regulation (EC) No 1698/2005.

[48] One of the aims of measure 122 is to contribute to diversification (see Recital 22 of Regulation (EC) No 1698/2005). Diversification in forestry means the creation of new sources of income from forestry activity, including, in particular, production of non-wood goods, such as fruits, mushrooms, seeds, honey and so on, and delivery of marketed services such as hunting licences. The production of fuelwood may also be considered as a diversification in forests traditionally exploited for the production of industrial roundwood and vice versa.

[49] See paragraph 38.

[50] COM(2011) 627 final/2 of 19 October 2011.

[51] Article 27 of COM(2011) 627 final of 12 October 2011, p. 50.

[52] Article 22.

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ANNEX I

ALLOCATION OF FINANCIAL RESOURCES FOR MEASURE 122 VS EXTENSION OF FOREST AREAS IN PRIVATE OWNERSHIP BY MEMBER STATE

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Source: ECA own elaboration based on figures reported by DG Agriculture and Rural Development and forestry statistics reported by Eurostat in 2011.

Member State | EAFRD contribution for M122 planned in the first version of the RDP 2007–13 | EAFRD contribution for M122 planned in the RDP as of 31.12.2011 | Total planned public expenditure for M122 as of 31.12.2011 | EAFRD contribution as of 31.12.2011 for new applications in the 2007–13 programming period | Total public expenditure as of 31.12.2011 for new applications in the 2007–13 programming period | Forest and other wooded land | Forest in private ownership |

(1000 euro) | (1000 ha) |

Bulgaria | 19278 | 9278 | 11597 | 4800 | 6000 | 3927 | 519 |

Czech Republic | 19158 | 20658 | 27543 | 11438 | 15250 | 2697 | 616 |

Germany | 1400 | 635 | 847 | 236 | 315 | 11076 | 5368 |

Estonia | 15565 | 15506 | 20674 | 4016 | 5355 | 2350 | 1345 |

Greece | 10630 | 0 | 0 | 0 | 0 | 6539 | 845 |

Spain | 42850 | 51185 | 85533 | 13520 | 25373 | 27747 | 12838 |

France | 36220 | 34965 | 67553 | 14904 | 29147 | 17572 | 11841 |

Italy | 103454 | 96201 | 205976 | 22343 | 48996 | 10916 | 6076 |

Latvia | 34066 | 14395 | 19431 | 2169 | 2762 | 3467 | 1696 |

Lithuania | 15375 | 11031 | 14708 | 4276 | 5702 | 2240 | 784 |

Luxembourg | 795 | 795 | 3977 | 50 | 250 | 88 | 46 |

Hungary | 8831 | 19289 | 27125 | 9472 | 12806 | 2029 | 861 |

Austria | 26222 | 19817 | 38726 | 14955 | 31693 | 4006 | 2482 |

Portugal | 99244 | 64026 | 76915 | 12451 | 16304 | 3611 | 3382 |

Romania | 158692 | 108692 | 133699 | 0 | 0 | 6733 | 2097 |

Slovenia | 18704 | 19454 | 25939 | 12370 | 16495 | 1274 | 962 |

Slovakia | 30720 | 30720 | 41445 | 7987 | 10655 | 1933 | 958 |

United Kingdom | 11683 | 18081 | 25136 | 2149 | 4118 | 2901 | 1922 |

TOTAL | 652887 | 534729 | 826824 | 137137 | 231221 | 111106 | 54638 |

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ANNEX II

LIST OF INVESTMENT PROJECTS REVIEWED

Country | Number of project | Nature of project | Forest area declared/ managed (ha) | Total investment (euro) | Total public expenditure (euro) | Total EAFRD contribution (euro) | On-the-spot visit |

ES | 1 | Silvicultural actions in broadleaves and others | 50,00 | 104524,44 | 56726,18 | 32651,59 | Yes |

2 | Silvicultural actions on eucalyptus stands | 33,84 | 51517,76 | 25758,90 | 14826,82 | Yes |

3 | Thinning and pruning of coniferous stands | 50,00 | 92384,00 | 55430,40 | 31905,74 | Yes |

4 | Thinning and pruning of coniferous stands | 50,00 | 99524,00 | 59714,42 | 34371,62 | Yes |

5 | Thinning in coniferous stands | 50,00 | 87584,00 | 52550,40 | 30248,01 | Yes |

6 | Programme for a comprehensive increase in value and promotion of multifunctionality | 969,10 | 53632,59 | 26816,30 | 15435,46 | No |

7 | Actions to value and promote the multifunctional role of forests | 947,00 | 152913,02 | 74615,98 | 42948,96 | No |

8 | Elaboration of technical plans for management of wooded land | 3555,06 | 90000,00 | 60000,00 | 34536,00 | No |

9 | Elaboration of technical plans for management of wooded land | 6002,00 | 150000,00 | 90000,00 | 51804,00 | No |

10 | Programme for a comprehensive increase in value and promotion of multifunctionality | 1410,00 | 112916,76 | 70150,06 | 40378,37 | No |

IT | 1 | Pruning and grafting of chestnut trees for the production of chestnuts | 20,57 | 159785,99 | 95871,59 | 42183,5 | Yes |

2 | Cutting of brush, pruning and grafting of chestnuts for fruit production | 1,36 | 5066,64 | 3039,98 | 1337,59 | Yes |

3 | Cutting of brush, pruning and grafting of chestnuts for fruit production, acquisition of a brush cutter and a chainsaw | 1,42 | 15980,14 | 9580,14 | 4218,76 | Yes |

4 | Pruning and grafting of chestnuts for fruit production, acquisition of machines for forestry work and first processing of logs | 5,81 fruit chestnut, 59,63 other trees | 74476,24 | 44685,74 | 19661,73 | Yes |

5 | Pruning and grafting of chestnuts for fruit production, acquisition of machines for forestry work | 7,05 fruit chestnut, 59,63 other trees | 132117,05 | 79270,23 | 34878,9 | Yes |

6 | Refurbishing of a room on the farm premises to be used for sorting and temporary storing chestnuts; acquisition of implements and machines for tending fruit chestnuts. | 3,54 | 58184,32 | 34910,59 | 15360,66 | Yes |

7 | Acquisition of machinery for forestry work and first processing of wood (trailer, crane, tractor, excavator, shredder), as well as personal protection equipment (overalls, helmets, footwear, gloves, first-aid kits) | 243,06 | 224108,29 | 134465,04 | 59164,62 | Yes |

8 | Acquisition of a forestry tractor, pruning of pine trees (pinus pinea) | 32,88 | 286439,11 | 171862,75 | 75619,361 | Yes |

9 | Restoring of cork oak groves (clearing of brush and trees, pruning) | 94,00 | 389568,91 | 230103,57 | 101246,27 | Yes |

10 | Restoring of cork oak groves (clearing of brush and trees, pruning), acquisition of machinery for forestry work (excavator, tractor, brush cutter, crane, chainsaws) | 5,00 restored cork oaks, 931,00 other wooded land | 331348,17 | 198808,90 | 43737,96 | Yes |

IT | 11 | Thinning of artificial black pine groves of advanced age, in order to favour native silver firs and to promote the natural regeneration of the forest in its original mixed composition of conifers and hardwoods. | 15,32 | 37646,46 | 22587,88 | 9938,67 | Yes |

12 | Restoring of a fruit chestnut plantation (clearing, pruning, grafting), partial restoring of a farm building, acquis- ition and installation in the building of a chestnut dryer, establishment of a forest management plan. | 5,00 fruit chestnuts, 64,00 other trees | 19603,65 | 10835,57 | 4767,65 | Yes |

13 | Thinning of black pine plantations about 50 years old to favour natural regener- ation with broadleaved species; acquis- ition of machinery (excavator, shredder, wood splitter). | 6,47 | 99509,57 | 57121,65 | 25133,53 | Yes |

14 | Thinning of black pine plantations about 50 years old to favour natural regener- ation with broadleaved species; acquis- ition of a trailer and a windlass. | 5,52 | 47698,00 | 28618,80 | 12592,27 | Yes |

15 | Building and equipment of a sawmill for the production of boards and pallets | 20,00 | 182854,26 | 109712,57 | 48273,53 | Yes |

16 | Acquisition of an excavator | 105,33 | 104950,00 | 62970,00 | 27706,80 | Yes |

17 | Acquisition of forestry crane and trailer | 105,33 | 45208,33 | 27125,00 | 11935,00 | Yes |

18 | Acquisition of a forestry tractor | 105,33 | 35500,00 | 21300,00 | 9372,00 | Yes |

19 | Acquisition of machinery (wood splitter, brush cutter, chainsaws, windlass) and personal protection equipment (overalls, helmets, footwear, gloves) | 45,00 | 13360,00 | 8016,00 | 3527,04 | Yes |

HU | 1 | Machinery — Tractor, Truck, Trailer, Plough, Fertilizer spreader | 68,41 | 667904,00 | 333952,00 | 248093,00 | Yes |

2 | Machinery — Tractor, Crane, Forwarder, Trailer | 586,91 | 747435,00 | 373718,00 | 277635,00 | Yes |

3 | Machinery — Wood chipper, Tractor, Crane, Forwarder, Trailer | 868,03 | 1424309,00 | 712154,00 | 529059,00 | Yes |

4 | Machinery — Tractor, Trailer, Plough, Harrow | 124,52 | 443795,00 | 221897,00 | 164847,00 | Yes |

5 | Machinery — Tractor, Plough | 94,30 | 183007,00 | 91504,00 | 45423,00 | Yes |

6 | Machinery — Tractor, Harrow, Trailer | 301,73 | 168373,00 | 84186,00 | 62542,00 | Yes |

7 | Machinery — Tractor, Plough, Harrow | 116,97 | 837792,00 | 418896,00 | 311198,00 | No |

8 | Machinery — Tractor, Harrow, Plough, Trailer | 51,60 | 429535,00 | 214768,00 | 159551,00 | No |

9 | Machinery — Tractor, Crane, Forwarder | 2632,48 | 656168,00 | 328084,00 | 243734,00 | No |

10 | Machinery — Tractor, Plough, Harrow | 66,14 | 827713,00 | 413853,00 | 307451,00 | No |

11 | Machinery — Tractor, Plough, Harrow, Trailer | 107,75 | 220776,00 | 110388,00 | 82007,00 | No |

12 | Machinery — Tractor, Harrow, Fertilizer spreader | 625,30 | 268519,00 | 134259,00 | 99741,00 | No |

13 | Machinery — Tractor, Wood chipper | 89,68 | 430259,00 | 215129,00 | 159819,00 | No |

14 | Machinery — Tractor, Plough, Harrow, Trailer | 162,86 | 159228,00 | 79614,00 | 59145,00 | No |

AT | 1 | Planting of willows and poplars on agricultural land for short rotation coppice (3–4 years rotation time) | 0,39 | 1170,00 | 585,00 | 284,84 | Yes |

2 | Planting of broadleaved species in conifer forests damaged by storm | 10,40 | 62400,00 | 31200,00 | 15150,72 | Yes |

3 | Thinning of conifer stands of up to 15 metres of height | 7,90 | 7260,00 | 3630,00 | 1767,45 | Yes |

4 | Planting of broadleaved species in conifer forests damaged by storm | 17,47 | 53077,59 | 26536,00 | 12889,84 | Yes |

5 | Acquisition of a towed crane | 6400,00 | 44166,67 | 15458,00 | 7506,40 | Yes |

6 | Establishment of a forest management plan | 1000,00 | 36667,67 | 18333,00 | 8902,50 | Yes |

7 | Thinning of up to 15 metre high conifer stands | 20,00 | 30000,00 | 15000,00 | 7303,50 | Yes |

8 | Drying equipment for wood-chips | N/A [1] | 132443,07 | 36000,00 | 17481,60 | Yes |

9 | Chipping and drying of poplars from short-rotation coppice established on agricultural land (3–4 years rotation time) | 2,20 | 1900,20 | 950,00 | 462,55 | Yes |

AT | 10 | Planting of poplars on agricultural land for short rotation coppice (3–4 years rotation time) | 0,62 | 1560,00 | 780,00 | 379,78 | Yes |

11 | Acquisition of a transport container for wood chips | N/A [1] | 19600,00 | 3920,00 | 1908,65 | Yes |

12 | Thinning of up to 18 metres high broadleaved stands | 20,00 | 30000,00 | 15000,00 | 7303,50 | Yes |

13 | Building of a storehouse for wood chips | N/A [1] | 124650,67 | 24930,00 | 12138,42 | Yes |

14 | Planting complementing natural regeneration, thinning of up to 18 metres high broadleaved stands as well as of up to 15 metres high conifer stands | 26,50 | 22419,40 | 11209,00 | 5443,09 | Yes |

15 | Harvesting and chipping of poplars and willows from short-rotation coppice established on agricultural land (3–4 years rotation time) | 21,80 | 20736,66 | 10368,00 | 5048,18 | Yes |

SI | 1 | Forest Track | 38,15 | 15641,00 | 7965,00 | 5973,00 | Yes |

2 | Machinery — Tractor | 23,70 | 69510,00 | 34550,00 | 25913,00 | Yes |

3 | Forest Road | 19,82 | 66170,00 | 31521,00 | 23641,00 | Yes |

4 | Forest Road | 261,15 | 40564,00 | 20282,00 | 15211,00 | No |

5 | Machinery — Tractor, Harvester | 3,49 | 230890,00 | 138534,00 | 103901,00 | Yes |

6 | Machinery — Trailer | 45,63 | 45449,00 | 5500,00 | 4125,00 | No |

7 | Forest Road | 24,00 | 50654,00 | 21106,00 | 15829,00 | No |

8 | Machinery — Harvester, Tractor, Forwarder, Truck with Crane/Cable-boom | 3,30 | 1157730,00 | 500000,00 | 375000,00 | Yes |

9 | Forest Track | 15350,00 | 21752,00 | 10876,00 | 8157,00 | No |

10 | Machinery — Tractor | 1,70 | 79099,00 | 39550,00 | -29662,00 | No |

[1] Austria financed biomass processing investments without demanding beneficiaries to declare specific forest areas.

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