EUROPEAN COMMISSION Brussels, 7.9.2021 COM(2021) 539 final REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL 14th FINANCIAL REPORT FROM THE COMMISSION TO THE EUROPEAN PARLIAMENT AND THE COUNCIL





on the EUROPEAN AGRICULTURAL FUND FOR RURAL DEVELOPMENT (EAFRD)





2020 FINANCIAL YEAR



Contents 1.Budget procedure 1.1.Financial framework 1.2.Draft Budget (DB) 2020 1.3.The adoption of the 2020 Budget 1.4.The adoption of the Amending Budgets 2.Management of appropriations 2.1.Management of commitment appropriations 2.1.1.EAFRD rural development programmes 2.1.2.Technical assistance 2.2.Management of payment appropriations 2.2.1.EAFRD rural development programmes 2.2.2.Technical assistance 3.Implementation of the 2020 EAFRD budget 3.1.Implementation of commitment appropriations 3.1.1.EAFRD rural development programmes 3.1.2.Technical assistance 3.2.Implementation of payment appropriations

3.2.1.EAFRD rural development programmes 3.2.2.Technical assistance 3.3.Analysis of expenditure declared by measure 3.4.Implementation of EAFRD programmes

1. Budget procedure 1.1. Financial framework Rural development expenditure in 2020 is funded within the multiannual financial framework (MFF) 2014-2020. The financial framework is provided by Council Regulation (EU) No 1311/2013. The allocation for rural development and the allocation for market related expenditure and direct payments after the annual technical adjustment of the MFF are presented in table 1. Table 1 – Financial framework 2014-2020 HEADING 2. In million EUR; current prices Sustainable growth: natural resources 2014 2015 2016 2017 2018 2019 2020 TOTAL 49 857 64 692 64 262 60 191 60 267 60 344 60 421 of which : - Rural Development a), b), c), d), e) 5 298.9 18 183.7 18 683.7 14 371.2 14 381.0 14 690.6 14 709.4 - Market related expenditure and direct aids, a), b), c), d) 43 778.1 44 189.8 43 950.2 44 145.7 44 162.4 43 880.3 43 887.1 a) After net transfer of EUR 351.9 million between EAGF and EAFRD for the financial year 2014 (see note f for details) b) After net transfer of EUR 51.6 million between EAGF and EAFRD for the financial year 2015 (see note f for details) c) After net transfer of EUR 28 million between EAGF and EAFRD for the financial years 2014-2020 (see note f for details) d) After net transfer of EUR 4 313.9 million between EAGF and EAFRD for financial years 2015-2020 (see note f for details) e) After the reprogramming of the EAFRD allocation of year 2014 following the application of Article 19 of MFF Regulation (EU) No 1311/2013 a total amount of EUR 8 705 million deducted from 2014 commitments was equally distributed to 2015 and 2016 commitments f) The transfers to rural development (EAFRD) mentioned in notes a) to d) above involve: EUR 4 million transferred annually for the whole period 2014-2020 from the cotton sector (Greece) on the basis of Article 66(1) of Regulation (EU) No 1307/2013, EUR 296.3 million set for the voluntary adjustment transferred for the financial year 2014 (UK) on the basis of Article 10b and 10c(2) of Regulation (EC) No 73/2009, EUR 51.6 million for unspent amounts transferred each year for financial years 2014 and 2015 (SE and DE) on the basis of Articles 136 and 136b of Regulation (EC) No 73/2009 and EUR 4 313.9 million for the reduction of payments and the flexibility between pillars on the basis of Articles 7(2) and 14(1) of Regulation (EU) No 1307/2013 1.2. Draft Budget (DB) 2020 The Draft Budget (DB) 2020 was adopted by the Commission on 5 July 2019. It included EUR 14 699 million in commitment appropriations and EUR 13 120 million in payment appropriations for the European Agricultural Fund for Rural Development (EAFRD) 2014-2020 programming period.



The Council adopted its position on the Draft Budget on 3 September 2019. On 15 October 2019 the Commission presented the Letter of Amendment No 1/2020 to the draft general budget. The European Parliament adopted its position on 23 October 2019. As in previous years, the Conciliation Committee had to be convened. The Conciliation Committee agreed on a joint text within the 21-day time-limit. The Council and the European Parliament approved the joint text respectively on 25 November and 27 November 2019. 1.3. The adoption of the 2020 Budget The 2020 Budget adopted on 27 November 2019 was, as regards the EAFRD, equal to the Commission’s Draft Budget both in commitment and payment appropriations. Table 2 Adopted Budget 2020 Budget Item Commitment appropriations Payment appropriations (in EUR) (in EUR) 2014-2020 05.046001 (Rural development programmes) 14.675.251.797 13.100.000.000 05.010404 (Non-operational technical assistance) 5.100.000 5.100.000 05.046002 (Operational technical assistance) 18.308.550 15.023.550

1.4. The adoption of the Amending Budgets The Amending Budget No 9/2020 increased the payment appropriations for EAFRD rural development programmes by EUR 750 million. Table 3 Budget 2020 after the Amendments Budget Item Commitment appropriations Payment appropriations (in EUR) (in EUR) 2014-2020 05.046001 (Rural development programmes) 14.675.251.797 13.850.000.000 05.010404 (Non-operational technical assistance) 5.100.000 5.100.000 05.046002 (Operational technical assistance) 18.308.550 15.023.550 2. Management of appropriations 2.1. Management of commitment appropriations 2.1.1. EAFRD rural development programmes As regards commitment appropriations for the EAFRD rural development programmes, the 2020 voted budget amounted to EUR 14 675 million, all related to the 2014-2020 programmes. Table 4 Management of commitment appropriations in 2020 – EAFRD Budget Item 05.046001 (in EUR) Appropriations at the beginning of 2020 14.675.251.797 Appropriations available in 2020 14.675.251.797 Appropriations used in 2020 14.675.249.297 2.1.2. Technical assistance Article 51(1) of Regulation (EU) No 1305/2013 provides that the EAFRD may use up to 0.25% of its annual allocation to finance technical assistance actions at the initiative of the Commission. In the 2020 budget, the initial amount available for this purpose was EUR 5.1 million for non-operational technical assistance and EUR 18.3 million for operational technical assistance. 2.2. Management of payment appropriations 2.2.1. EAFRD rural development programmes For the rural development programmes 2014-2020, the payment appropriations of the voted budget 2020 amounted to EUR 13 100 million. In addition, the available assigned revenue transferred from the previous year amounted to EUR 650 million and the assigned revenue collected during the year amounted to EUR 259 million. The payment appropriations were reinforced by the Amending Budget No 9/2020 in the amount of EUR 750 million, by the end-of-the year transfer for an amount of EUR 47 million, and by two transfers between and within budget chapters totalling EUR 3 million. Taking into account all transfers, the total amount of payment appropriations available in 2020 amounted to EUR 14 809 million. In total, EUR 14 569 million of payment appropriations were used and EUR 240 million of assigned revenue were automatically carried over from 2020 to 2021.





Table 5 Management of payment appropriations in 2020 (in EUR) EAFRD (2014-2020) Budget Item - 05.046001 Appropriations at the beginning of 2020 13.100.000.000 Transfer from "EAFRD 2014-2020 Technical assistance" line 1.000.000 Autonomous Transfer between Chapters 2.173.788 Amending Budget No 9/2020 750.000.000 End-of-the year transfer 47.000.000 Assigned revenue carried over from 2019 650.019.733 Assigned revenue collected in 2020 259.118.386 Appropriations available in 2020 14.809.311.907 Appropriations used in 2020 14.569.480.584 2.2.2. Technical assistance As regards the EAFRD technical assistance at the initiative of the Commission, total payment appropriations in the 2020 budget amounted to EUR 20.1 million, including EUR 5.1 million for non-operational technical assistance and EUR 15.0 million for operational technical assistance. EUR 1 million was transferred to the EAFRD 2014-2020 programmes line to cover the payment needs. The final payment appropriations was therefore EUR 19.1 million. 3. Implementation of the 2020 EAFRD budget 3.1. Implementation of commitment appropriations 3.1.1. EAFRD rural development programmes Table 6 shows, per Member State, the allocation established by Regulation (EU) No 1305/2013 as last amended by Regulation (EU) 2020/2220 and the amounts committed in 2020. Table 6 Regulation (EU) No 1305/2013 (as amended) vs. amounts committed by the end of 2020 Budget item: 05.046001 (in EUR) MS Regulation (EU) No 1305/2013 Amounts committed in 2020 2020 Allocation (a) (b) BE 102.723.155 102.723.155 BG 338.990.216 338.990.216 CZ 321.615.103 321.615.103 DK 151.588.619 151.588.619 DE 1.394.588.766 1.394.588.766 EE 129.177.183 129.177.183 IE 312.570.314 312.567.814 GR 698.261.326 698.261.326 ES 1.183.394.067 1.183.394.067 FR 1.987.739.983 1.987.739.983 HR 282.342.500 282.342.500 IT 1.501.763.408 1.501.763.408 CY 18.881.481 18.881.481 LV 161.491.517 161.491.517 LT 264.151.386 264.151.386 LU 14.511.390 14.511.390 HU 486.662.895 486.662.895 MT 13.858.647 13.858.647 NL 147.976.388 147.976.388 AT 567.266.225 567.266.225 PL 1.187.301.202 1.187.301.202 PT 582.456.022 582.456.022 RO 1.139.927.194 1.139.927.194 SI 120.720.633 120.720.633 SK 214.524.943 214.524.943 FI 344.776.578 344.776.578 SE 249.818.786 249.818.786 UK 756.171.870 756.171.870 Total 14.675.251.797 14.675.249.297

3.1.2. Technical assistance For the programming period 2014-2020, the amount of commitment appropriations for operational technical assistance in the budget 2020 was EUR 18.3 million. Table 7 shows the consumption of the commitment appropriations available for operational technical assistance in 2020 which reached EUR 17.9 million, i.e. an execution rate of almost 98%. The most important part relates to the European Network for Rural Development. Table 7 Technical assistance – Implementation of commitment appropriations Budget Item: 05.046002 (in EUR) Description Amount committed European Network for Rural Development 4.775.056 Information technology* 3.718.305 European Innovation Partnership 2.784.971 European Evaluation Network 2.600.000 Corporate Communication 1.845.000 Technical Advisory Platform for Financial Instruments 1.000.000 Audit and Controls 790.561 Organic agriculture database 350.000 Total 17.863.893 * Including BCO (Broadband Competence Offices)

3.2. Implementation of payment appropriations 3.2.1. EAFRD rural development programmes For the programming period 2014-2020, EUR 14 569.5 million of the payment appropriations were implemented out of EUR 14 809.3 million available. Table 8 shows the breakdown of payments made in 2020 by declaration period:

Table 8 Payments 2020 for EAFRD rural development programmes (in million euro) 2014-2020 Pre-financing 2014-2020 0 Reimbursement of payment claims prior to Q4 2019 22.441.523 Reimbursement of payment claims Q4 2019 5.981.516.332 Reimbursement of payment claims Q1 2020 2.922.983.665 Reimbursement of payment claims Q2 2020 3.322.894.277 Reimbursement of payment claims Q3 2020 2.319.644.788 Total 2020 14.569.480.584 The monthly consumption of payment appropriations during the year (January to December 2020) is shown in the graph below. Graph 1

The breakdown per Member State and per declaration period of the amounts paid by the Commission in budget year 2020 is shown in table 9. Table 9 Payments effectively made between 01/01/2020 and 31/12/2020 EAFRD 2014-2020 - Budget item 05.046001 (in EUR) MS Pre-financing Prior to Q4 2019 Q4 2019 Q1 2020 Q2 2020 Q3 2020 Total BE 0 0 22.633.637 10.221.656 40.811.406 14.917.338 88.584.037 BG 0 0 94.619.801 51.059.351 95.970.799 61.377.146 303.027.096 CZ 0 1.243.302 66.331.120 211.947.392 89.585.660 35.016.907 404.124.382 DK 0 0 21.342.768 12.793.460 44.177.209 17.520.232 95.833.669 DE 0 430.665 624.801.406 297.773.284 262.169.493 171.301.611 1.356.476.457 EE 0 0 15.254.158 61.804.881 12.081.589 12.200.744 101.341.372 IE 0 0 171.904.352 26.221.747 37.750.130 97.958.687 333.834.915 GR 0 0 301.201.105 31.003.387 161.172.170 34.891.842 528.268.504 ES 0 0 575.993.456 129.280.942 314.284.640 202.042.142 1.221.601.180 FR 0 0 992.915.242 521.246.584 228.144.822 191.920.935 1.934.227.583 HR 0 0 69.679.464 101.844.879 126.288.667 61.411.910 359.224.921 IT 0 0 729.100.663 173.700.502 372.107.248 251.226.035 1.526.134.448 CY 0 0 7.094.755 3.052.288 8.251.714 3.642.307 22.041.064 LV 0 0 46.977.275 48.061.379 24.424.327 30.510.745 149.973.725 LT 0 153.698 79.488.127 38.080.698 49.374.943 22.808.338 189.905.805 LU 0 0 3.900.347 7.570.284 1.263.740 1.418.748 14.153.119 HU 0 0 183.849.875 98.429.983 176.016.151 107.181.921 565.477.931 MT 0 0 7.440.934 3.339.672 4.050.328 3.227.108 18.058.042 NL 0 0 16.136.441 75.676.544 15.845.200 21.665.878 129.324.063 AT 0 0 310.789.074 52.258.576 162.850.408 47.217.105 573.115.163 PL 0 0 351.293.769 331.932.216 279.575.300 243.321.308 1.206.122.592 PT 0 0 287.699.963 78.112.241 67.895.350 146.053.311 579.760.866 RO 0 18.718.168 348.319.324 211.016.820 291.275.824 281.791.057 1.151.121.193 SI 0 0 41.040.385 14.201.301 47.863.785 22.621.068 125.726.538 SK 0 0 58.401.782 45.723.277 57.913.820 31.663.011 193.701.890 FI 0 0 139.532.558 26.429.828 60.090.058 79.079.919 305.132.363 SE 0 0 194.056.782 57.298.926 43.686.324 31.096.244 326.138.276 UK 0 1.895.690 219.717.771 202.901.568 247.973.172 94.561.192 767.049.393 Total 0 22.441.523 5.981.516.332 2.922.983.665 3.322.894.277 2.319.644.788 14.569.480.584

Table 10 compares, for each Member State, the EAFRD 2014-2020 payments made in 2020 with the payments in 2019. Overall, the payments increased by 5% compared to year 2019 (EUR 14.6 billion vs. EUR 13.8 billion). Table 10 Payments made to Member States - Comparison 2020 vs 2019 - EAFRD 2014-2020 (in EUR) MS 2019 2020 Difference 2020 vs. 2019 Interim payments Pre-financing Total Interim payments Pre-financing Total (in €) (in %) BE 78.872.428 0 78.872.428 88.584.037 0 88.584.037 9.711.609 12,31% BG 308.634.763 0 308.634.763 303.027.096 0 303.027.096 -5.607.667 -1,82% CZ 393.828.050 0 393.828.050 404.124.382 0 404.124.382 10.296.332 2,61% DK 101.066.664 0 101.066.664 95.833.669 0 95.833.669 -5.232.995 -5,18% DE 1.273.596.303 0 1.273.596.303 1.356.476.457 0 1.356.476.457 82.880.155 6,51% EE 124.908.745 0 124.908.745 101.341.372 0 101.341.372 -23.567.374 -18,87% IE 324.022.439 0 324.022.439 333.834.915 0 333.834.915 9.812.476 3,03% GR 411.413.602 0 411.413.602 528.268.504 0 528.268.504 116.854.902 28,40% ES 1.165.619.770 0 1.165.619.770 1.221.601.180 0 1.221.601.180 55.981.410 4,80% FR 2.060.819.582 2.703.993 2.063.523.575 1.934.227.583 0 1.934.227.583 -129.295.992 -6,27% HR 299.635.531 0 299.635.531 359.224.921 0 359.224.921 59.589.389 19,89% IT 1.449.081.121 0 1.449.081.121 1.526.134.448 0 1.526.134.448 77.053.327 5,32% CY 20.952.824 0 20.952.824 22.041.064 0 22.041.064 1.088.240 5,19% LV 206.475.667 0 206.475.667 149.973.725 0 149.973.725 -56.501.942 -27,36% LT 181.240.364 10.800 181.251.164 189.905.805 0 189.905.805 8.654.641 4,77% LU 14.481.595 0 14.481.595 14.153.119 0 14.153.119 -328.475 -2,27% HU 511.369.533 0 511.369.533 565.477.931 0 565.477.931 54.108.398 10,58% MT 19.429.947 0 19.429.947 18.058.042 0 18.058.042 -1.371.905 -7,06% NL 90.398.504 0 90.398.504 129.324.063 0 129.324.063 38.925.559 43,06% AT 538.171.765 0 538.171.765 573.115.163 0 573.115.163 34.943.398 6,49% PL 1.092.284.985 0 1.092.284.985 1.206.122.592 0 1.206.122.592 113.837.608 10,42% PT 523.049.233 0 523.049.233 579.760.866 0 579.760.866 56.711.633 10,84% RO 967.073.048 0 967.073.048 1.151.121.193 0 1.151.121.193 184.048.145 19,03% SI 120.096.847 0 120.096.847 125.726.538 0 125.726.538 5.629.691 4,69% SK 209.361.675 0 209.361.675 193.701.890 0 193.701.890 -15.659.785 -7,48% FI 351.173.513 0 351.173.513 305.132.363 0 305.132.363 -46.041.151 -13,11% SE 226.298.189 0 226.298.189 326.138.276 0 326.138.276 99.840.087 44,12% UK 773.925.472 0 773.925.472 767.049.393 0 767.049.393 -6.876.079 -0,89% Total 13.837.282.157 2.714.793 13.839.996.951 14.569.480.584 0 14.569.480.584 729.483.634 5,27%