it -h 
•Cr <r COMMISSION OF THE EUROPEAN COMMUNITIES 
Brussels, 06.12.1996 
COM(96) t>51 final 
Report to the Council concerning 
application of Council Regulation (EEC) No 2990/82 
concerning 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) 

Report to the Council concerning 
application of Council Regulation (EEC) No 2990/82 
concerning the sale of butter at reduced prices to persons 
receiving social assistance 
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 the sale of butter to persons receiving 
social assistance has been in operation since 1 978 and Article 3a of Council Regulation 
(EEC) No 2990/82, last modified by Regulation (EC) n" 1802/95, requires that the 
Council, on the basis of a report from the Commission shall decide before 31.12.1 996 
whether the subsidized sales under the abovementioned Regulation are to be continued. 
Reports previously forwarded to the Council have on 4 occasions resulted in the 
continuation of the scheme for two consecutive years, ending 31.12.1996. Up until 
now the Regulation has only been applied in Ireland, and the following therefore refers 
to this Member State only. 
2- Criteria for the determination of entitlement 
Persons entitled to benefit from the scheme are those in receipt of social assistance 
payments 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; 
Windows' and Orphans' Pension; 
Deserted Wife's Allowance; 
Alone Parents Allowance; 
Prisoner's Wife's Allowance; 
Carer's Allowance; 
Blind Pension; 
Social Welfare (Supplementary Welfare) Allowance ; 
Pre-retirement Allowances. 
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 found 
eligible under the criteria set out in point 2 above. 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. 
^ 
4. Developments in the builej^ijg^_^JIoj^nii market in Ireland 
In accordance with Article 4(3) of Regulation (EEC) no 1898/87, the Member States 
shall forward to the Commission information concerning the developments on the butter 
and yellowfat 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 
developments between 1987 and 1995. 
Year 
1987 
. 1988 
1989 
1990 
1991 
1992 
1993 
1994 
1995 Butter 
Tonnes 
20.500 
16.325 
13.235 
12.000 
12.025 
11.925 
1 1.825 
12.000 
1 1.900 (%) 
42.4 
33.8 
27.4 
25.3 
25.4 
25.1 
25.1 
25.5 
25.4 Low-fat butter 
Tonnes 
2.000 
2.750 
1.860 
1.575 
1.575 
.1.575 
1.575 
1.500 
1.500 (%) 
4.1 
5.7 
3.9 
3.3 
3.3 
3.3 
3.3 
3.2 
3.2 Margarine 
Tonnes 
14.900 
14.200 
15.700 
15.100 
14.600 
13.900 
13.700 
13.200 
13.000 (%) 
30.8 
29.4 
32.5 
31.8 
30.9 
29.5 
29.1 
28.1 
27.7 Fat Mixture 
Tonnes 
11.000 
15.000 
17.500 
18.825 
19.100 
19.700 
20.000 
20.300 
20.500 (%) 
22.7 
31.1 
36.2 
39.6 
40.4 
41.8 
42.5 
43.2 
43.7 Total 
Tonnes 
48.400 
48.275 
48.295 
47.500 
47.300 
47.100 
47.100 
47.000 
46.400 
The total yellowfat market between 1 987 and 1 995 shows a decline of 4.1 % 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'shas disappeared since 1990 
showing a stable market share slightly in excess of 25%. 
5. Developments of sales, financial costs and number of beneficiaries 
Ireland has operated the aid scheme as provided for in the abovementioned Regulation 
since 1 978 and the scheme has, especially during the last year, accounted for important 
shares of the internal Irish butter consumption. In 1 995, the purchase of around 7.600 
tonnes of butter was aided under the scheme and the estimated purchases for 1 996 are 
approximately the same. Since 1992, 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 will remain practically unchanged in 1996. The 
total estimated cost calculated as the purchased quantities multiplied by the aid level 
after applying the switchover coefficient amounted to 10,4 MECU in 1996. 
The development in purchases, costs and number of beneficiaries since 1987 is 
indicated below : 
Year 
1987 
1988 
1989 
1990 
1991 
1992 
1993 
1994 
1995* 
1996* Purchases 
(in tonnes) 
5.651 
6.178 
6.567 
6.182 
6.260 
7.331 
7.400 
7.900 
7600 
7.500 Financial costs 
(MECU) 
10.06 
11.00 
11.69 
11.00 
9.39 
11.00 
10.36 
11.06 
8.74 
8.63 Beneficiaries* * 
720.000 
720.000 
720.000 
720.000 
740.000 
776.000 
834.000 
800.000 
916.000 
900.000 
Provisional and without the application of the switchover coefficient. 
Calculated on the basis of vouchers issued. 
6. Conclusions and recommendations 
The application of Council Regulation 2990/82 in Ireland has continued to be a 
successful means of maintaining sales to the social assistance categories indicated 
under point 2 which in the normal course of events would, for economic reasons, be 
at the forefront of change to cheaper substitutes. 
A reduction in consumption by these categories could result in sales of butter into 
intervention. Furthermore, a withdrawal of this longstanding benefit to the less well-off 
sectors of society e.g. the unemployed, old age pensioners, etc. could hardly be 
defended from a social, market or economic point of view. Furthermore, 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 
year period ending 31 December 1998. However, the maximum quantity eligible per 
beneficiary each month should, due to the general tendency of decline in Irish butter 
consumption over the last decade, be reduced from 1 kg to 0,5 kg. 
PROPOSAL FOR A 
COUNCIL REGULATION (EG) No 
amending Regulation (EEC) No 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 products1, as last amended by Regulation 
(EC) No 1587/962 and in particular Article 12(2) thereof, 
Having regard to the proposal from the Commission, 
Whereas Council Regulation (EEC) No 2990/823, as last amended 
by Regulation (EC) No 1802/954, introduces arrangements, expiring on 31 December 
1996, for the sale of butter at reduced prices to persons receiving social assistance; 
whereas, Article 3a(3) of that Regulation provides that the Council is to examine the 
possibility before that date and on the basis of a report from the Commission, of renewing 
the arrangements laid down; whereas, in view of the report presented by the Commission 
and the results achieved, the arrangements should be extended for two years, 
1 OJ No L 148, 28.6.1968. p. 13. 
2 OJ No L 206. 16.8.1996, p. 21. 
3 OJ No L 314, 10.11.1982. p. 26. 
4 OJ Np L 174, 26.7.1995. p. 27. 
4-
HAS ADOPTED THIS REGULATION: 
Article 1 
Regulation (EEC) No 2990/82 is hereby amended as follows: 
1. In Article 1, "31 December 1996" is replaced by "31 December 1998"; 
2. In Article 3a(3), "31 December 1996" is replaced by "31 December 1998". 
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 
£ 
' " ' ^——ww•—•—•—Ma—— FINANCIAL STATEMENT 
BUDGET HEADING: 
Chapter BI - 2040 
TITLE: APPROPRIATIONS: 
ECU 13.6 million (Second LA to 
the PDB 97) 
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 
AIMS: 
Extends the scheme for the sale of butter at reduced prices to persons receiving social assistance 
FINANCIAL IMPLICATIONS PERIOD OF 12 
MONTHS 
(ECU million) CURRENT 
FINANCIAL 
YEAR 
(97) 
(ECU million) FOLLOWING 
FINANCIAL 
YEAR 
(98) 
(ECU million) 
5.0 EXPENDITURE 
- CHARGED TO THE EC BUDGET 
(REFUNDS/INTERVENTION) 
- NATIONAL AUTHORITIES 
- OTHER + 10.2 +8.1 + 10.2 
5.1. REVENUE 
- OWN RESOURCES OF THE EC 
(LEVIES/CUSTOMS DUTIES) 
- NATIONAL 
1998 
(ECU m) 
5.0.1 ESTIMATED EXPENDITURE 
5.1.1 ESTIMATED REVENUE 1999 
(ECU m) 
+2,1 2000 
(ECU m) 2001 
(ECU m) 2002 
(ECU m) 
5.2 METHOD OF CALCULATION: 
12months: 7 000 t x 1.389 ECU/tx 1.047 (DR) = ECU 10.2 million (B) 
1997: 7 000 t x 1,389 ECU/t x 9.5/12 x 1.047 (DR) - ECU 8.1 million (B) 
6.0 CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE 
RELEVANT CHAPTER OF THE CURRENT BUDGET? 
6.2 YES/NO 
CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF THE 
CURRENT BUDGET? YES/NO 
WILL A SUPPLEMENTARY BUDGET BE NECESSARY? YES/NO 
WILL FUTURE BUDGET APPROPRIATIONS BE NECESSARY? YES/N© 
OBSERVATIONS: 
The second letter of amendment to the PDB was prepared on the basis of an extension of the scheme beyond 3 Î December 1996, 
10 000 tonnes and an unchanged aid rate. 
As the maximum quantity per person per month is reduced from 1 kg to 0.5 kg, the quantity of 10 000 tonnes in the PDB is now 
expected to drop to 7 000 tonnes. 
4 
ISSN 0254-1475 
COM(96)651 final 
DOCUMENTS 
03 05 01 
Catalogue number : CB-C0-96-654-EN-C 
ISBN 92-78-13142-3 
Office for Official Publications of the European Communities 
L-2985 Luxembourg 
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