WRITTEN QUESTION E-1736/99

by Ilda Figueiredo (GUE/NGL) to the Commission

(1 October 1999)

Subject: Allocation of rural development aid to Portugal

According to recent press reports in Portugal, the Commission has approved a proposal for the allocation of rural development aid which will involve the annual transfer to Portugal of only 40 billion escudos.

The Portuguese Government, however, proposed a programme costing 60 billion escudos per year, this being the minimum amount it regarded as necessary to compensate for the reduction in the funding transferred from the CAP, since Portuguese farmers are last on the list of CAP beneficiaries.

Since Portugal is a country with large areas of poor-quality soil, where farmers operate in mountainous areas and use environmentally sustainable agricultural methods, it is a prime candidate for the rural development policy proposals which appeared to have been adopted by the Commission.

What reasons led the Commission to allocate Portugal only 40 billion escudos per year for rural development, even though it knew that Portugal is the country most affected by the increasing liberalisation of agricultural markets and that Portuguese farmers' incomes are in constant decline?

Answer given by Mr Fischler on behalf of the Commission

(10 November 1999)

On 8 September 1999 the Commission decided on an indicative allocation by Member State of the allocations under the European Agricultural Guidance and Guarantee Fund Guarantee Section for rural development measures for the period 2000 to 2006. The criteria for this allocation include the number of agricultural holdings, the area covered by farming, the rural population and the share of farming in employment. Portugal's allocation amounts to EUR 200 million a year.

This allocation, which is 46,5 % up on the average annual financing for the same measures in the previous period (1994-1999), is intended to contribute to expenditure under four schemes only: early retirement, agri-environmental measures, afforestation and aid for less-favoured areas; all other rural development measures are financed by the EAGGF Guidance Section from the overall Structural Fund financing allotted to Portugal.

It is also worth bearing in mind that these allocations are quite flexible. First, the Commission is willing, within the limits of available resources, to adjust decisions on Member States' allocations in the first three years, in accordance with Article 46(3) of Council Regulation (EC) No 1257/1999 of 17 May 1999 on support for rural development by the European Agricultural Guidance and Guarantee Fund (EAGGF) and amending and repealing certain Regulations(1). Secondly, under the detailed rules adopted by the Commission in July 1999 for the application of rural development programmes, resources made available in view of initial expenditure forecasts but not used by a Member State in the course of the year may (beyond a certain percentage) be reallocated to Member States that have overrun their forecast expenditure. It should be possible, with this flexibility, to cope with unforeseen situations, even though over the period as a whole the Member States must work within the allocation fixed in the Commission Decision.

Moreover, Article 4 of Council Regulation (EC) No 1259/1999 of 17 May 1999 establishing common rules for direct support schemes under the common agricultural policy(2) provides for modulation of payments under common market organisations, so as to provide additional support for the four abovementioned rural development schemes.

(1) OJ L 160, 26.6.1999.

(2) OJ L 160, 26.6.1999.