Proposal for a COUNCIL REGULATION (EC) on the implementation of Member States' action programmes on control of EAGGF Guarantee Section expenditure
Date: 1995-10-12
Institutions: European Commission
Subjects: Community budget, EAGGF Guarantee Section, EU Member State, action programme, agricultural expenditure, aid to agriculture

COMMISSION  OF THE  EUROPEAN  COMMUNITIES 

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Brussels,  12.10.1995 
COM(95) 467 final 

95/0244  (CNS) 

REPORT FROM THE COMMISSION TO THE COUNCIL 

on the implementation  of Regulation (EEC) No 307/91 of 4 February  1991 on 

reinforcing Aie monitoring of  certain expenditure chargeable to the Guarantee Section 
of the European Agricultural  Guidance and Guarantee Fund,  for the period  1991-1993 

Proposal  for  a 

g5/Q24A 

{Çm) 

ÇQmçJl  REPUTATION (EC.) 

on the implementation of 

Member States' action programmes on control  of EAGGF 

Guarantee Section expenditure 

(presented  by the  Commission) 

CONTENTS 

Introduction 

Action  by the Member States 

Controls  carried ouï by the Member States 

Use of  Community financial resources 

Commission's  assessment  of the application  of the Regulation 

Future outlook 

1. 

2. 

3. 

4. 

5. 

6. 

Annex: 

Proposal  for  a Regulation 

1. 

Introduction 

Council  Regulation  (EEC)  No  307/91,  which  came  into  force  on  9  February  1991, 
encourages Member States to step up controls in the fieldof export refunds on agricultural 
products and products exported  as goods not falling  within  Annex II  (Article  1) and in 
that of  certain compensatory  aid and intervention  measures (Article 2).* 
To  help  the Member  States  bear the  extra  cost  of  reinforcing  controls,  the  Regulation 
provides  for  a financial  contribution  from  the  Community  over  a five-year period  at a 
declining  rate:  50% for  three years  and  25% for  two  years,  up to  a maximum  annual 
amount at Community  level  of ECU 20 million  (ECU  10 million  for expenditure under 
Article  1 and ECU  10 million  for expenditure under Article 2). 

The Regulation provides that the Community financing  should be allocated each year by 
the Commission between the Member States concerned, proportionally to average EAGGF 
expenditure  in the relevant  sectors during the two previous financial years. 

The Regulation  specifies  the  categories  of  expenditure  eligible  for financial assistance 
from  the  Community.  They  mainly  include  the  remuneration  of  the  agents  occupying 
supplementary posts, the cost of training and briefing the agents, responsible for controls, 
the  cost  of  equipping  agents,  and  laboratory  costs  for  checking  products  intended  for 
export, with  a view to the granting of refunds. 

2. 

Action bv the Member States 

Over the period considered, only  four Member States, Belgium, France, Ireland and the 
Netherlands, took  action  in all the areas provided for. The others applied only  some, or 
only  one, of  the possible measures. 

In  general,  the  Member  States  have  concentrated  on  export  refunds  rather  than 
compensatory  aid and intervention  measures; in particular, three Member States, Greece, 
Ireland  and  the  United  Kingdom,  took  no  measures  other  than  those  relating  to  the 
inspection  of  products  exported.  However,  Spain  and Portugal  (in  the first two  years) 
concentrated  on aid measures, taking no action in the other sector. 

The  level  of  expenditure  varied  widely  from  one  Member  State  to  another,  as  did the 
application  of  the  different  types  of  measure  provided  for  in  the  Regulation.  Annex I 
shows expenditure by  each Member State, by year and by  category  of measure. 

aid per hectare, aid for the set-aside of arable land, premiums provided for in the 
beef  and veal  and  sheepmeat  and  goatmeat  sectors,  aid  for  oil  seeds,  measure-
provided for in the wine sector, measures provided for in the fruit and vegetables 
sector, measures provided  for in the tobacco  sector, measures provided  for dried 
grapes, aid for cotton. 

2.1 

Remuneration of  officers 

As  a  rule,  the  flat-rate  amount  of  ECU 28 500  per  person  per  year  for  wages  and 
travelling  costs of the officers  responsible for controls, fixed by Commission  Regulation 
(EEC) No 967/91  of  19 April  19911  and valid  throughout  the Community,  was used as 
a basis  for calculating  staff  costs. 

For most of the Member  States, these costs were a major,  if not  an essential,  component 
of their expenditure; the exceptions were Italy and the United Kingdom, neither of which 
have  submitted  any expenditure  in this  sector. 

In  general,  remuneration  declared  relates  to officers  redeployed  following  restructuring 
in  the departments  concerned;  rarely  does  it concern  newly  recruited  staff.  This  is due, 
first,  to the problems of taking on new personnel, because of the  budgetary  restraints on 
most  national  civil  service  departments,  and secondly  to the need  to reassign  redundant 
staff,  especially  customs  officers,  following  the  reduction  in  border  controls  at  the 
Community's  internal  frontiers. 

Table  1: 

Number of extra  officers  declared by the Member States  (men/year) 

Member  State 

1991 

1992 

1993 

Total 

Belgium 

Denmark 

Germany 

Greece 

Spain 

France 

Ireland 

Italy 

Netherlands 

Portugal 

UK 

Total 

8 

10 

19 

0 

111 

75 

2 

0 

112 

0 

0 

337 

8 

11 

31 

4 

75 

209 

6 

0 

131 

22 

0 

497 

9 

15 

82 

11 

55 

165 

8 

0 

136 

27 

0 

508 

25 

36 

132 

15 

241 

449 

16 

0 

379 

49 

0 

1342 

As  the  following  table  shows,  more  of  these  officers  were  responsible  for  controls 
covering  products  eligible for  refunds  than  for aid and intervention. 

O J N oL  100, 20.4.1991, p.18 

Table 2: 

Officers  declared by  sector of  activity 

Member  State 

Products  for 
export 
(Article  1) 

Aid  and 
intervention 
(Article  2) 

Total 

Belgium 

Denmark 

Germany 

Greece 

Spain 

France 

Ireland 

Italy 

Netherlands 

Portugal 

UK 

Total 

14 

22 

132 

15 

0 

213 

16 

0 

330 

0 

0 

742 

11 

14 

0 

0 

241 

236 

0 

0 

49 

49 

0 

25 

36 

132 

15 

241 

449 

16 

0 

379 

49 

0 

600 

1342 

2.2 

Training  and briefing 

Training  and  briefing  organized  by  the  Member  States  for  their  inspectors  has  on  the 
whole  been  negligible,  if  not  non-existent.  Any  measures  that  were  taken  were  spread 
over the whole period,  in the form  of  courses and seminars of variable  duration.  A total 
of  about  9 900  officers  were  involved  (see table below  for  details). 

The level of expenditure was particularly low. Unlike the other forms of expenditure, this 
remark  applies  in  all  the Member  States  (see  Annex  I  for  a table  on the breakdown  of 
expenditure ). 

Table  3: 

Main  types  of  training  fur  officers 

rasassssss 
Member  State 

sxsaiMxaJUmœtZ-àsssseiBSssss 

Type  of  training 

Belgium 

Denmark 

Germany 

Greece 

Spain 

France 

Ireland 

Italy 

techniques  for  checking  agricultural  produce; 
computer  techniques 

methodology  and  rules  for  controls 

accounting,  control  techniques 

current  legislation,  chemistry 

controls  on  aid  per  hectare,  cotton,  wine 
growing  sector 

rules  and  procedures  for  controls,  computer 
techniques,  food  chemistry 

control  techniques 

fraud,  chemistry 

Netherlands 

legal  provisions,  rules  governing  controls 

Portugal 

Community  law,  computer  techniques 

United  Kingdom 

control  of  agricultural  products  for  export 

Total 

2.3 

Equipment  costs 

Tata!  number 
of 
participants 

428  ! 

498 

150 

35 

359 

7343 

168 

36 

194 

69 

596 

9876 

All  the  Member  States  made  use  of  Community  financing  to  purchase  equipment,  in 
particular  computer  hardware  and  software,  and  vehicles,  with  a  view  to  improving  the 
work  of  officers  responsible  for  controls,  increasing  their  mobility  and  capacity  to  cope 
with  more  controls,  and  improving  the  quality  and  speed  of  verifications. 

On  the  computer  side,  much  of  the  expenditure  went  on  microcomputers,  software  and 
printers,  and  on  developing  new  systems,  and  updating  existing  programmes. 

Purchases  of  means  of  transport  related  to  renewing  or  reinforcing  the  existing  vehicle 
stock.  There  was  very  little  vehicle  hire,  except  by  certain  French  inspectorates. 

In general, the volume of  expenditure  on equipment  was large, especially  in Denmark  and 
France.  In  Italy  and  the  UK,  this  category  represented  virtually  the  only  item  of 
expenditure. 

2.4 

Laboratory  costs  (analyses) 

Analyses  were  carried  out  by  the  national  departments  responsible  for  inspecting 
commercial  operations  in the field of  export  refunds,  and  more  specifically  the  customs 
departments,  or  by  specialized  laboratories  at  the  request  of  those  departments,  on  the 
quality  and/or  the  quantity  of  products  exported,  with  a  view  to  detecting  any 
irregularities. 

Expenditure  on  analyses  was  declared  in  seven  Member  States:  Belgium,  Denmark, 
France, Greece, Ireland, the Netherlands  and Portugal. The number  of  samples  analysed 
in  virtually  all  the  sectors  eligible  for  refunds  was  very  high,  with  the  French  customs 
service  giving  a  figure  of  about  15 500,  and  the  Portuguese  Wine  Institute  a  figure  of 
about  14 000. 

Controls carried out bv the Member States 

The  information  available  on  the  precise  number  of  controls  carried  out  is  not 
harmonized,  so that  no  statistics  can  be  established  at Community  level.  Some  Member 
States  freely  admit  that  they  are  unable  to  put  a  precise  figure  on  the  extra  controls 
carried  out  in  the framework  of Regulation  (EEC) No  307/91,  because  the  departments 
responsible for control  also work in other sectors, and carry out large numbers of controls 
each  year. 

Table 4: 
Member State 

Main  sectors  covered (exported  products and aid) 

Belgium 

Denmark 

Germany 

Greece 

Spain 

France 

Ireland 

Sectors 

Cereals,  sugar,  dairy  products,  beef  and  veal,  sheepmeat  and 
goatmeat,  aid  per  hectare,  products  not  covered  by  Annex II, 
processed  products 

Cereals, composite  products,  dairy  products,  meat 

Cereals, sugar,  milk,  poultrymeat, beef  and  veal, pigmeat  and 
sheepmeat,  products not  covered  by  Annex II, tobacco 

Products not covered by Annex  II, cereals, processed fruit  and 
vegetables 

Aid per hectare,  wine-growing,  aid  for  cotton 

Cereals,  milk,  tobacco,  wine-growing,  aid  per  hectare,  arable 
land  set-aside,  beef  and  veal,  sheepmeat  and  goatmeat, 
withdrawal  of  fruit  and  vegetables,  products  not  covered  by 
Annex  II 

Beef  and  veal,  pigmeat,  dairy  products,  products  not  covered 
by  Annex II 

Italy 

Netherlands 

Olive  oil, processed  fruit  and vegetables, wine-growing,  dairy 
products 

Cereals,  sugar,  arable  land  set-aside,  beef  and  veal,  pigmeat, 
sheepmeat,  processed  products,  dairy  products, tobacco 

Portugal 

Cereals,  wine-growing 

United Kingdom 

All  sectors 

4. 

Use  of  Community financial resources 

All  the  Member  States  made  use  of  the  Community  financial  aid  available,  with  the 
exception  of  Luxembourg,  which  has  never  used  it, and, in  1991, of  Greece, which  did 
not  use the  aid,  and  of  the United  Kingdom,  which  did  not  request  it. 

Expenditure  by  the  Member  States  amounted  to  ECU  7.3  million  in  1991.  The  overall 
rate of utilisation  of the Community  contribution  was only  37% of the amount available. 
Only  Belgium,  Denmark,  Spain,  France  and  the  Netherlands  used  up  a  higher-than-
average percentage  (45% to 86%); all the other Member  States used up from  3% to 15% 
of  the  amounts  made  available. 

There was a slight improvement  in  1992. when the Member  States' expenditure increased 
to  ECU  9.3  million,  or  47% of  the total  amount  available.  However,  this  result  hides  a 
variety  of different  situations at national  level: rates of utilization  were above average in 
Denmark,  Spain  and  France  (64% to  83%), while  Belgium,  Germany,  Ireland  and  the 
United Kingdom all used about 30% of the resources available to them. Greece, Italy and 
Portugal  used only  3% to  17% of the funds  at their  disposal.  Only  the Netherlands used 
up  all  the  available  resources. 

In  1993. expenditure  by  the Member  States  amounted  to ECU  10.3  million,  or  52% of 
the total  available financing. 

This gradual  improvement  is due to  an  increase  in the rate of  utilization  of  Community 
financing  by  Member  States  such  as  Germany  (from  15% in  1991  to  59%  in  1993), 
Ireland  (from  9%  in  1991  to  52% in  1993)  and  Portugal  (from  5% in  1991  to  45% in 
1993), and to the steady high rate of utilization of Denmark, France and the Netherlands, 
which have  continued  to  use up available  funds,  and  were even  granted  extra financing 
from  resources not used by the other Member States, under Commission Regulation (EC) 
No  1116/94.2 

Amending Commission Regulation  (EEC) No  967/91  (OJ No L  122,  17.5.1994, p.13). 

8 

Expenditure by both Greece and Italy  remained fairly  low (it should be pointed out that 
in those countries, it related only to the activities of the control services depending on the 
Finance Ministry), as did expenditure by the United Kingdom. 

Annex II  shows  the  Member  States'  rates of  utilization  of  Community  financing  from 
1991  to 1993. 

5. 

Commission's  assessment of  the application  of the Regulation 

Commission departments have reported regularly to the Member States on the application 
of  the  Regulation,  at  meetings  of  the  EAGGF  Group  of  experts  on  irregularities  and 
mutual  assistance. While welcoming the interest shown by certain Member States in the 
Regulation,  as demonstrated  by  their regular use of  the Community financing it makes 
available,  the  Commission  has  not  concealed  its  dissatisfaction  and  its  concern  about 
under-use  of  the  resources  by  certain  national  departments,  especially  those  that might 
have been thought to need them most. 

In particular, the Commission regrets that the Member States have, in general, made little 
use of  Community  financial  support to do more in the way of  training, which  is a very 
important factor in ensuring  effective  controls, and which  all  agreed was inadequate. 

The Commission  also wonders whether the measures taken by  the Member  States were 
part of  a well-defined  strategy,  or simply  a response to  immediate  pressing  needs. The 
Commission also wonders about how the Member States view Community financing: as 
a  real financial incentive  to  reinforce  controls,  or simply  as  a means  of  reducing their 
budget costs, with Community financing as an extra resource in a budget that would have 
existed anyway. 

In  these  conditions,  while  noting  the  progress  made,  the  Commission  cannot  be  sure 
whether  the  aim  set  by  the  Regulation,  the  reinforcement  of  controls,  has  really  been 
achieved. 

Nevertheless,  recognizing  that  some  rigidity  in  the  rules  on  granting  aid  had  become 
apparent  during  the  second  year  of  application  of  the  Regulation,  Commission 
departments took  the  initiative,  in  1993, of  embarking  upon  a revision  of  Commission 
Regulation  (EEC)  No  967/91,  with  a view,  among  other  things,  of  enabling  Member 
States  to  receive  financing  in  each  of  the  sectors  concerned,  so  as  to  satisfy  their 
requirements  in the sector where the need for  reinforcement  was most urgent. This work 
led  to the  adoption  of Regulation  (EC) No  1116/94,  mentioned  above. 

By  providing  the  Member  States  with  an opportunity  to  adapt  Community  financing  to 
their  needs,  and  providing  the  possibility  of  extra  resources  from  amounts  originally 
allocated  to the other Member  States, but not  taken  up, thù Commission  departments  are 
confident  that  they  hâve  acted  not  only  in  the  interests  of  the  Member  States,  and 
especially  those that have been  most  active  and most  willing to  use up  all the  financing 
put  at  their  disposal,  but  also  in  compliance  with  the  principles  of  good  financial 
management. 

Clearly,  however,  the  problems  some  Member  States  have  in  tapping  Community 
resources  must  be  attributed  in  the  first  place  to  the  arrangements  for  part-financing, 
which  entail  setting  aside  in  the  national  budget  an  amount  equal  to  the  amount  of 
Community  aid. 

Moreover,  experience  seems  to  show  that  introducing  part-financing  arrangements  at  a 
high  rate  does not  take  account  of  the lead  time for  national  budgets  to respond,  which 
means that part of the Community  contribution  is lost from  the outset. It would be better 
to  start  with  a  low  rate  of  part-financing,  progressively  increasing  to  a  maximum,  and 
then  decreasing  to  allow the national  budget to take  over  gradually. 

There  is  no  doubt  that  as  the  Community  financial  contribution  is  limited  in  time,  the 
Member States limit their expenditure, especially on recruitment, to what they know they 
can  cover  in  the  longer  term. 

All  these  factors  need  to be taken  into  account  in  future. 

6. 

Future outlook 

A long discussion  could be held on whether  the Community  should  contribute or not, in 
particular  through  budgetary  measures, to  covering costs incurred by the Member  States 
for  the  control  of EAGGF  Guarantee  Section  expenditure. 

To protect the Community's interests, it seems appropriate to continue providing  financial 
assistance  to  the  Member  States  for  controls,  but  to  do  so  in  the  framework  of  better 
structured  initiatives  in  a form  different  from  that provided  for  in Regulation  (EEC) No 
307/91. 

Allocating funds  to the Member  States solely  on the basis of expenditure incurred  in the 
areas  covered  by  the  Regulation  appears  too  limited,  as  it  does not  take  account  of  the 
specific  problems of  individual  Member  States, nor  of their  capacity  to  use  Community 
aid. 

Moreover,  to  preclude  the  use  of  Community  financing  for  measures  whose  impact  on 
controls  is  difficult  to  establish,  it  would  be  helpful  if  the  Member  States  hoping  to 
receive  Community  financing  could  define  their  action  strategy  and  set  the  aims  to  be 
achieved  from  the  outset. 

Community  assistance  should  be decided  case by  case, taking  account  first  of  all of the 
usefulness  of the proposed  measures, but also of the budget problems that might face the 
Member  States, because  of the risk  that these problems  might prevent  priority  measures 
from  being taken. 

It  is  essential  to  maintain  the  systems  of  control  and  direct  electronic  information 
exchange  set  up  between  the  Member  States  and  the  Commission  constantly  at  peak 
performance  level. 

10 

To this end, a proposal  for a Council  Regulation  is annexed to this report. Among other 
things, this proposal  provides that the Member States should submit to the Commission 
action programmes, possibly  multiannual, including an analysis of the existing situation, 
the aims to be achieved, and the measures to be carried out, where appropriate, each year. 

After consulting the Fund Committee, the Commission sets the rate and maximum amount 
of  the  Community's  financial  participation  (which  may  cover  up to  100% of  national 
expenditure) for each year of an action programme, as a function  of  available resources 
and  taking  account  of  the  need  for  the  measures  proposed  by  the  Member  State,  the 
problems  it  might  encounter  in financing  them, and the progress made with  the action 
programme. 

Annex: 

Proposal  for a Regulation 

11 

EXPENDITURE BY THE MEMBER  STATES, BROKEN DOWN BY CATEGORY (ay % of total expenditure) 

ANNEX  I 

Table  1: 

Expenditure  in 1991 

MEMBER  STATE 

TOTAL  ELIGIBLE 

STAFF 

TRAINING 

EQUIPMENT 

COST  OF 

TOTAL 

EXPENDITURE 

ANALYSES 

BELGIUM 

DENMARK 

GERMANY 

GREECE 

SPAIN 

FRANCE 

IRELAND 

ITALY 

210  629 

963  473 

369  520 

0 

1  207 003 

2  508 219 

67  437 

97  431 

NETHERLANDS 

1  887 871 

PORTUGAL 

UNITED 

KINGDOM 

TOTAL 

52  684 

0 

7  364 267 

54% 

54% 

0% 

57% 

0% 

82% 

43% 

21% 

0% 

82% 

0% 

0% 

8% 

7% 

0% 

0% 

1% 

8% 

1% 

7% 

1% 

0% 

0% 

4% 

35% 

54% 

43% 

0% 

17% 

37% 

1% 

93% 

10% 

100% 

0% 

3% 

39% 

0% 

0% 

0% 

12% 

77% 

0% 

7% 

0% 

0% 

100% 

100% 

100% 

0% 

100% 

100% 

100% 

100% 

100% 

100% 

100% 

30% 

12% 

100% 

Table 2: 

Expenditure in  1992 
J 

MEMBER  STATE 

TOTAL  ELIGIBLE 

STAFF 

TRAINING 

EQUIPMENT 

COST  OF 

TOTAL 

EXPENDITURE 

ANALYSES 

BELGIUM 

DENMARK 

GERMANY 

GREECE 

SPAIN 

FRANCE 

IRELAND 

ITALY 

182 947 

744  899 

580  658 

34  581 

1  302 016 

3  112 522 

173  290 

515  874 

NETHERLANDS 

2  058 300 

256  646 

383  205 

PORTUGAL 

UNITED 

KINGDOM 

TOTAL 

57% 

17% 

74% 

27% 

82% 

76% 

52% 

0% 

83% 

98% 

0% 

3% 

1% 

0% 

3% 

1% 

4% 

2% 

7% 

4% 

2% 

21% 

22% 

47% 

26% 

50% 

17% 

14% 

1% 

93% 

7% 

0% 

79% 

18% 

35% 

0% 

100% 

100% 

100% 

20% 

100% 

0% 

6% 

100% 

100% 

45% 

100% 

0% 

6% 

0% 

0% 

100% 

100% 

100% 

100% 

9  344 938 

66% 

4% 

22% 

8% 

100% 

12 

Table 3: 

Expenditure in 1993 

MEMBER  STATE 

TOTAL  ELIGIBLE 
EXPENDITURE 

STAFF 

TRAINING 

EQUIPMENT 

COST OF 
ANALYSES 

TOTAL 

BELGIUM 

DENMARK 

GERMANY 

GREECE 

SPAIN 

FRANCE 

IRELAND 

ITALY 

NETHERLANDS 

PORTUGAL 

UNITED 
KINGDOM 

TOTAL 

189 497 

700  174 

1 495  586 

191 592 

795 254 

3 319 911 

279 645 

455 079 

2 315 994 

454 465 

68% 

31% 

78% 

39% 

99% 

71% 

42% 

0% 

84% 

49% 

172 875 

0% 

1% 

0% 

1% 

2% 

1% 

5% 

1% 

0% 

0% 

0% 

9% 

15% 

27% 

21% 

0% 

0% 

15% 

2% 

100% 

10% 

1% 

91% 

16% 

42% 

100% 

100% 

0% 

100% 

59% 

0% 

9% 

55% 

0% 

6% 

50% 

100% 

100% 

100% 

100% 

100% 

100% 

100% 

0% 

100% 

10 370 072 

67% 

2% 

18% 

12% 

100% 

13 

f] 

M e m b er 
State 

! 
j| Belgium 

1991 

1992 

1993 

Total 

A 

B 

% 

A 

B 

% 

A 

B 

% 

A 

B 

% 
use 
91-
93 

466 600 

210 629 

i Denmark 

1 114 000 

963 474 

Germany 

2 409 200 

369 520 

•\ Greece 

1 333 000 

0 

j Spain 

2 121 500 

1 207 003 

] France 

3 683 400 

2 508 219 

Ireland 

Italy 

726 400 

67 437 

3 047 800 

97 431 

45 

86 

15 

0 

57 

68 

9 

3 

799 500 

182 947 

902 200 

744 899 

2 436 600 

580 658 

1 350 200 

34 581 

2 026 600 

1 302 016 

3 935 300 

3 112 522 

569 800 

173 290 

2 988 800 

515 874 

23 

83 

24 

3 

64 

79 

30 

17 

1 137 400 

189 497 

17 

2 403 500 

583 073 

24 

877 600 

700 174 

80 

2 893 800 

2 408 547 

83 

2 526 300 

1 495 586 

59 

7 372 100 

2 445 764 

33 

1 523 900 

191 592 

13 

4 207 100 

226 173 

5 

1 605 400 

795 254 

50 

5 753 500 

3 304 273 

57 

4 126 500 

3 319 911 

80 

11 745 200 

8 940 652 

76 

541 700 

279 645 

52 

1 837 900 

520 372 

28 

3 360 000 

455 079 

14 

9 396 600 

1 068 384 

11 

Netherlands 

2 799 200 

1 887 869 

67 

2 058 300 

2 058 300 

100 

1 749 100 

2 315 994 

132 

6 606 600 

6 262 163 

95 

Portugal 

United 
Kingdom 

997 100 

52 684 

1 521 600 

0 

5 

0 

1 503 900 

256 646 

17 

1 015 900 

454 465 

45 

3 516 900 

763 795 

22 

1 428 600 

383 205 

27 

1 536 200 

172 875 

11 

4 486 400 

556 080 

12 

Total 

20 000 000 

7 364 266 

37 

20 000 000 

9 344 938 

47 

20 000 000 

10 370 072 

52 

60 000 000 

27 079 276 

45 

"A~=  financing  available 
B  =  amount  used 
%  =  rate  of  utilization  B:A  as  % 

14 

Proposal 

95/0244  (CNS) 

for a Council  Regulation  on the implementation  of 

Member States' action programmes on control  of EAGGF 

Guarantee Section expenditure 

THE  COUNCIL  OF THE EUROPEAN  UNION, 

Having  regard  to  the  Treaty  establishing  the  European  Community,  and  in  particular 

Article 43 thereof, 

Having regard to the proposal from the Commission1, 

Having regard to the opinion of the European Parliament2, 

Whereas Article 8 of Council Regulation (EEC) No 729/70 of 21 April  1970 on the financing of 
the common agricultural  policy3,  as  last  amended  by  Regulation  (EC)  No  1287/954  lays 

down  that Member  States are  to take  the measures  necessary  to  satisfy  themselves  that 

transactions  financed  by  the  European  Agricultural  Guidance  and  Guarantee  Fund 

(EAGGF)  are  actually  carried  out  and  are  executed  correctly,  prevent  and  deal  with 

irregularities  and  recover  sums lost  as a result  of  irregularities  or  negligence; 

Whereas  the  part-financing  introduced  by  Council  Regulation  (EEC)  No  307/91  of 

4 February  1991 on reinforcing  the monitoring of certain  expenditure chargeable to the 
Guarantee Section  of  the European  Agricultural  Guidance and  Guarantee Fund5,  as last 
amended  by  Regulation  (EC)  No  3235/946,  will  lapse  at  the  end  of  the  1995  financial 

year  for  the first  twelve Member  States and at the end of the  1997 financial  year for  the 

three  new  Member  States; 

2 

3 

OJ No C 
OJNo 
OJNO  L 94, 28.4.1970, p. 13. 
O J N oL  125, 8.6.1995,  p. 1. 
OJNo  L 37, 9.2.1991, p. 5. 
OJNo  L  338,  28.12.1994, p.  16. 

v 

Whereas  the  Commission  has  sent  a  report  to  the  Council  on  the  implementation  of 

Regulation  (EEC)  No 307/91  during  the period  1991 to  1993,  expressing  the view  that 

the Member  States should  continue to receive financial  assistance  for  the  monitoring  of 

expenditure  chargeable  to  the  EAGGF  Guarantee  Section,  in  view  of  the  Community 

financial  interest  at  stake; 

Whereas  provision  should  be  made,  for  a  certain  period  and  within  the  limit  of  the 

appropriations available, for Community financing for Member States' action programmes 

in the field  of control of expenditure to amend or improve their monitoring  structures or 

make them  more  effective; 

Whereas the programmes must have a number of features enabling the Commission, with 

full  knowledge  of  the  facts,  to evaluate  the  measures proposed  by  the Member  States; 

Whereas the programmes may be of a multiannual nature; whereas, it is appropriate that 

henceforth  information  relating  to  the  annual  instalments  to  be  presented  by  Member 

States  each  year  should  be  specified; 

Whereas provision  should be made for consultation of the Fund Committee on the annual 

instalments  which  may  qualify  for  Community  financing; 

Whereas it should  be specified  that the Commission  is to set the rate of  the Community 

financial  contribution  and  the  maximum  amount  of  that  contribution  for  each  annual 

instalment; 

Whereas  systems  of  control  and  direct  electronic  information  exchange  between  the 

Member Sates and the Commission covering the control of certain expenditure should be 

maintained  and  developed; 

Whereas it should be laid down that the financing  provided  for  in this Regulation  cannot 

be combined  with  other  Community  financing; 

Whereas detailed  rules  for  the conversion  of amounts expressed  in ecus and  in  national 

currency  should  be laid  down, 

• 

it 

HAS  ADOPTED THIS REGULATION: 

Article 1 

1. 

The Community shall contribute towards the costs incurred by Member States on 

implementing action programmes to improve the structures of inspection services or their 

effectiveness. 

2. 

The action programmes referred to  in paragraph  1 may relate to the creation or 

reorganization of inspection services dealing totally or partially with control of EAGGF 

Guarantee Section expenditure. 

3. 

The measures provided for in such programmes may include the redeployment or 

recruitment of inspectors and their assignments, the purchase or  hire of  equipment and 

facilities  required  for  the  performance  of  controls,  the  organisation  of  training  and 

briefing  or any other appropriate means of  reinforcing  the effectiveness  of controls. 

Article 2 

1. 

Member  States  shall  submit  the  action  programmes  they  wish  to  receive 

Community  financing  to  the  Commission  not  later  than  1 July  of  the  calendar  year 

preceding the start of their implementation. Programmes presented after 1 July cannot be 

considered. 

However, for programmes relating to the first year of application of this Regulation, the 

time limit  for  submission  of  action programmes  shall  be the end of  the  second  month 

following  the date of entry into force  of  the implementing  Regulation. 

• 

2. 

Programmes  may be multiannual and must include the following  information: 

description  and analysis of  the situation  at the outset  as  regards  inspectors and 

equipment; 

objectives of  the planned action; 

schedule for implementation of measures; 

detailed description of the work for which financing  is requested; 

estimate  of  costs  of  each  type  of  action  and  in  the  case  of  multiannual 

programmes,  annual financial  estimates; 

cost/benefit  analysis of the measure. 

3. 

The Commission shall examine the programmes presented by the Member States. 

It may request additional information it deems necessary for assessing the programmes. 

Article 3 

1. 

Member States having presented action programmes in accordance with Article 2 

shall communicate to the Commission at a date to be specified  by the Commission the 

information  about the annual  instalment  which  is to be implemented  for  the  following 

year,  and in particular: 

a) 

b) 

a description of  the work planned and a detailed estimate of costs; 

an annual application for financing and, where appropriate, an application for an 

advance on the Community  financial  contribution; 

c) 

from  the  second  year  of  execution  of  the  action  programme,  a  preliminary 

assessment  of  the  schemes  implemented  during  the preceding  year  and,  where 

appropriate,  a proposal to amend the initial programme. 

2. 

The annual  instalment of  the action programme  shall be implemented  between 

1 January and 31 December of each year. 

# 

V* 

Article 4 

1. 

The Community  financial  contribution  shall be granted per calendar  year,  for a 

period of  five consecutive years,  starting with  1996. 

It shall be granted within the limit of the annual appropriations authorized by the budget 

authority  in the light of  the financial  perspective. 

2. 

After  consulting  the  Fund  Committee  referred  to  in  Article  11  of  Council 

Regulation (EEC) No 729/70, the Commission shall, for each annual instalment,  set the 

rate  of  the  Community  financial  contribution  and  the  maximum  amount  of  such 

contribution  having  regard  to  the  appropriations  available  and  on  the  basis  of  the 

information  supplied by the Member State. 

Having  regard  to  the  interest  represented  by  the  measures  provided  for  in  the annual 

instalment and any difficulties faced by the Member Sate in financing it, the Commission 

may decide that the instalment in question or part thereof shall be charged entirely to the 

Community budget. 

Acceptance of  financing  of an annual instalment by the Commission  shall not prejudge 

the decision  on  a  financial  contribution  to  subsequent annual  instalments,  Community 

financing be reassessed each year as regard both the rate and the amount, in the light of 

the results achieved by previous annual instalments. 

3. 

The Commission may have work undertaken for the maintenance and development 

of  systems of  control  and direct electronic  information  exchange between the Member 

States and itself. 

* 

\ *> 

Article 5 

Expenditure incurred which is eligible for Community financing under other Regulations 

and in particular: 

Council  Regulation  (EC)  No  165/94  of  24  January  1994  concerning  the 

co-financing  by  the  Community  of  remote  sensing  checks  and  amending 

Regulation  (EEC)  No  3508/92  establishing  an  integrated  administration  and 
control  system  for certain Community  aid schemes7 

and,  as regards the three new Member States: 

Council  Regulation  (EEC)  No  4045/89  of  21  December  1989  on  scrutiny  by 

Member  States  of  transactions  forming  part of  the  system  of  financing  by  the 

Guarantee Section of the European Agricultural Guidance and Guarantee Fund and 
repealing Directive 77/435/EEC 8 

Council  Regulation  (EEC)  No  307/91  of  4 February  1991  on  reinforcing  the 

monitoring  of  certain  expenditure  chargeable  to  the  Guarantee  Section  of  the 
European Agricultural  Guidance and Guarantee Fund9 

Council  Regulation  (EEC)  No  3508/92  of  27  November  1992  establishing  an 
integrated administration and control system for certain Community aid schemes10, 

shall not be eligible under this Regulation. 

OJ No L 24, 29.1.1994, p. 6. 
OJ  No  L  388,  30.12.1989,  p.  18.  Regulation  amended  by  Regulation  (EC) 
No  3094/94  (OJ No L 328, 20.12.1994, p. 1). 
OJ No L 37, 9.2.1991, p. 5. 
OJNoL355,  5.12.1992, p. 1. 

10 

# 

Xc 

Article 6 

Detailed rules for the application of this Regulation shall be adopted in accordance with 

the procedure laid down in Article  13 of Regulation  (EEC) No 729/70. 

Article 7 

After  the  fifth  year,  the  Commission  shall  report  to the  Council  on  the results  of the 

implementation  of  this Regulation. 

Article 8 

Amounts  expressed  in  ecus  and  in  national  currency  shall  be  converted  using  the 

exchange rate in  force  on the first  working  day of  the calendar  year during  which the 

annual  programme  concerned  begins,  as  published  in  the  "C" series  of  the  Official 

Journal of  the European Communities. 

Article 9 

This Regulation shall enter into force on the seventh 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 

i\ 

FINANCIAL  STATEMENT 

BUDGET HEADING:  BI - 360 

APPROPRIATIONS: ECU 44 million 

TITLE: Council  Regulation (EC) on the implementation  of Member States' action programmes on control of EAGGF Guarantee Section expenditure] 

LEGAL BASIS: Article 43 of the EC Treaty 

AIMS: to finance  expenditure incurred by Member States on implementing action programmes to improve the structure of inspection services or their] 
effectiveness 

FINANCIAL  IMPLICATIONS: 

5.0. 

EXPENDITURE 
- CHARGED TO THE EC BUDGET 

(REFUNDS/INTERVENTION) 

-  NATIONAL AUTHORITIES 
-OTHER 

5.1. 

REVENUE 
- OWN RESOURCES OF THE EC 
(LEVIES/CUSTOMS  DUTIES) 

-  NATIONAL 

5.0.1. 
5.1.1. 

ESTIMATED  EXPENDITURE 
ESTIMATED REVENUE 

5.2. 

METHOD OF CALCULATION: 

Maximum authorized as EAGGF Guarantee contribution 

PERIOD OF  12 
MONTHS 

(ECU  million) 

CURRENT 
FINANCIAL YEAR 
(95) 
(ECU  million) 

FOLLOWING 
FINANCIAL YEAR 
(96) 
(ECU million) 

ECU  15 million 

1997 

1998 

1999 

2000 

ECU  15  million 

ECU  IS  million 

ECU  IS  million 

ECU  IS million 

6.0. 

6.1. 

6.2. 

6.3. 

CAN THE PROJECT BE FINANCED  FROM  APPROPRIATIONS  ENTERED  IN THE RELEVANT CHAPTER OF THE 
CURRENT BUDGET? 

CAN THE PROJECT BE FINANCED  BY TRANSFER  BETWEEN CHAPTERS OF THE CURRENT BUDGET? 

WILL A SUPPLEMENTARY  BUDGET BE NECESSARY? 

WILL FUTURE BUDGET APPROPRIATIONS  BE NECESSARY? 

¥£S/NO 

¥£S/NO 

¥E£/NO 

YES/NO 

OBSERVATIONS 

The  1996 PDB takes account of this expenditure. 
THE MEASURE INCLUDES  EXPENDITURE ON WORK TO MAINTAIN  AND DEVELOP SYSTEMS OF CONTROL AND 
DIRECT ELECTRONIC INFORMATION  EXCHANGE  BETWEEN THE MEMBER  STATES  AND THE COMMISSION. 
ESTIMATED  EXPENDITURE: ECU 300 000 X  5 YEARS  =  ECU  1.5  MILLION. THIS  EXPENDITURE IS INCLUDED EN 
POINTS 5.0  AND  5.0.1. 

• 

n 

ISSN 0254-1475 

COM(95) 467  final 

DOCUMENTS 

EN 

03 

Catalogue number  :  CB-CO-95-509-EN-C 

ISBN 92-77-94116-2 

Office  for Official Publication! of the European Communities 

L-2985 Luxembourg 

z\