Proposal for a Council Regulation (EC) fixing a supplementary premium payable to sheep producers in non-less favoured areas of Ireland and the United Kingdom in respect of Northern Ireland
Date: 1996-04-15
Institutions: European Commission
Subjects: Ireland, Northern Ireland, agricultural guidance, financial loss, sheepmeat

COMMISSION  OF THE EUROPEAN  COMMUNITIES 

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Brussels,  15.04.1996 
COM(96)  152  final 

96/0102  (CNS) 

Proposal  for  a 

COUNCIL  REGULATION  (EC) 

fixing  a  supplementary  premium  payable  to  sheep  producers  in  non-less  favoured 
areas  of  Ireland  and  the  United  Kingdom  in  respect  of  Northern  Ireland 

(presented  by  the  Commission) 

Explanatory  Mémorandum 

The  Council,  in  December  1995,  made  the  following  declaration  in  relation  to  sheepmeat 

prices  in  Ireland. 

"The Council  recalls  in the context of the  1995 prices package,  it registered  its concern  about 

sheepmeat  price  developments  in  Ireland  and  Northern  Ireland.  Despite  the  welcome  effort 

which  the  Commission  made  to  rectify  the  situation  by  means  of  private  storage  operations, 

il  notes  that  a  certain  group  of  producers,  essentially  producers  outside  the  Icss-lavourcd-

arca,suffered  from  exceptionally  low  prices  during  the  late  Spring  period,  a  period  which  is 

crucial  to  their  profitability.  As  the  annual  premium  is  calculated  on  the  basis  of  average 

price  throughout  the  season,  the  Council  regulation  provides  no  power  for  the  Commission 

which  would  enable  it to  resolve  this  problem.  The  Council  declares,  however,  its  readiness 

to  decide  on  a  Commission  proposal,  in  the  knowledge  of  its  financial  implications,  which 

could  be  presented  when  budgetary  resources  premit,  providing  for  the  granting  of  a 

supplementary  premium  strictly  limited to the marketing  year  1995/96, and to those  producers 

concerned  in  Ireland  and  Northern  Ireland." 

The  background  to  this  declaration  lies  in  the  fact  that,  while  prices  in  Ireland  and  Northern 

Ireland  fell  broadly  in  line  with  the  decrease  in  the  Community  average  market  price  of (>% 

in  1995,  the  fall  in  prices  was severe  during  the  Spring  period  which  is of critical  importance 

to  certain  producers. 

In comparison  to the  last two years, prices were  lower  in spring  1995 in  Ireland  and  Northern 

Ireland  by  about  15 %.  Production  costs  and  lamb  prices are  generally  very  high  at this  time 

of year  so that the fall  in prices, brought  about,  in particular,  by  increased  and  unusual  supply 

patterns  and  reduced  demand,  sharply  reduced  producers'  returns.  The  vast  majority  of  the 

producers  concerned  in  Ireland  and  Northern  Ireland  are  located  in  non  less  favoured  areas 

where  soil  and  climatic  conditions  permit  the  production  of  early  lamb. 

i 

In  response to this difficult  situation,  the Commission  operated  two private storage  schemes 

attracting,  in  all,  about  I  000  t  sheepmeat  in  Ireland  and  Northern  Ireland.  While  these 

schemes certainly had positive effects  in limiting further  price falls, they did not restore prices 

to normal  levels. 

The sheepmeat regime provides that the level of the Community  ewe premium  is calculated 

on  the  basis  of  the  difference  between  the  Community  average  market  price  and  the  basic 

price.  In  1995, the level of this premium at 24.821  Ecu per ewe (heavy  lamb producer) was 

up by approximately  3.34  Ecu on  1994 reflecting  the fall  in market prices in the Community. 

The  Commission,  therefore,  stresses  that  the  premium  is  playing  its  normal  role  of 

compensating  producers when  market  prices  fall. 

However,  Council  Regulation  (EEC)  N°  3013/89  provides  no  means  for  taking  account  of 

severe price  falls over a critical  limited  period  as was the case  in spring  1995 in  Ireland and 

Northern Ireland.  Therefore the Council's preparedness to find a solution to the problem must 

be addressed  in another  manner. 

It  is  for  this  reason  that  the  Commission  proposal  takes  the  form  of  a  separate  regulation 

fixing a supplementary premium limited to the producers concerned and to the 1995 marketing 

year. 

The proposed  level of the supplementary  premium  is 6.5  Ecu per ewe.  This level  reflects the 

Commission's  indication  to the Council  that, as  it would  be difficult  to quantify  exactly  the 

extent  of  the  overall  drop  in  income,  it  would  be  more  reasonable  to  adopt  a  forfaitaire 

approach  which  would Cnsure that the measure was not too costly. 

3 

When  the  Council  has  adopted  this  proposal,  the  Commission,  in  the  detailed  rules,  will 

ensure  that  payment  is  limited  to  producers  in the areas  concerned  who applied  for  and  were 

granted  the  1995  ewe  premium  and  is made  subject  to the  same  conditions  as those  applying 

to  that  premium. 

The  financial  consequences  for  the  1996  budget  are  further  expenditure  of  9.5  MECU. 

•+ 

Council  Régulai ion  (IX  )  No 

fixing  a  supplementary  premium  payable  to  sheep  producers  in  non-less  favoured 
areas  of  Ireland  and  the  United  Kingdom  in  respect  of  Northern  Ireland 

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  Commission, 

Having  regard  to  the  opinion  of  the  European  Parliament  (l). 

Whereas  Article  5  of  Regulation  (EEC)  No  3013/89  on  the  common  organisation  of  the 

market  in  sheepmeat  and  goatmeat  (2)  as  last  amended  by  Regulation  (EC)  No  1265/95  (i) 

provides  for  the  grant  of  a  premium  to  the  extent  necessary  to  offset  any  income  loss  to 

sheepmeat  producers  in the Community; whereas the loss of income is calculated  on the  basis 

of  the  difference  between  the  Community  average  market  price  and  the  basic  price; 

Whereas  in  Ireland  and  Northern  Ireland  prices  and  production  costs  in  late  Spring  are 

normally  relatively  high;  whereas  in  late  Spring  1995,  due  in  particular  to  abnormal  supply 

patterns,  prices  there  were  exceptionally  low  thus  reducing  sharply  producers'  returns  from 

the  market;  whereas the producers concerned  are  located  principally  outside the  I ess-favoured 

areas; 

Whereas  the  level  of  the  ewe  premium  is  insufficient  to  compensate  these  producers; 

( i) 

(2)  OJN°  L  289  7.10.1989  p. 1 

(3)  OJN°  L  123  3.6.1995  p.  1. 

Whereas  Regulation  (EEC)  No  3013/89  does  not  provide  any  means  to  rectify  this  very 

difficult  and  exceptional  situation;  whereas,  it  is  therefore  necessary  to  provide  for  a 

supplementary  premium  limited  to  the  producers  affected  in  the  regions  indicated  and  to  the 

1995  marketing  year, 

HAS  ADOPTED  THIS  REGULATION 

Article  1 

In  Ireland  and  the  United  Kingdom  in  respect  of  Northern  Ireland  in  areas  other  than  those 

defined  in Article 3 (3) (4) and  (5) of Directive  75/268/EEC  a supplementary  premium  of  6.5 

ECU  per  ewe  is  payable  to  producers  in  respect  of  the  1995  marketing  year, 

This supplementary  premium  is granted  subject  to the  same conditions  as those  laid  down  for 

the  granting  of  the  1995  premium  to  sheepmeat  and  goatmeat  producers. 

Article  2 

Detailed  rules  for  the  application  of  this  regulation  shall  be  adopted  by  the  Commission,  if 

necessary,  in accordance  with  the  procedure  laid  down  in Article  30 of  Regulation  (EEC)  No 

3013/89. 

Article  3 

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 

L> 

FINANCIAL  STATEMENT 

BUDGET  HEADING:  2220 

APPROPRIATIONS:  ECU  I  ?52m 

TITLE:  Council  Regulation fixing an additional  premium  payable  to sheepmeat  producers  in  non-lcss-favoim <1  areas in 
Ireland and Northern Ireland 

LEGAL  BASIS: Article 43 of the Treaty 

AIMS OF PROJECT: 

To  grant  an additional  premium  to  sheepmeat  producers  in non-less-favoured  areas  in  Ireland  and  Northern  Ireland  to 
offset  a substantial  loss of  income  incurred  by  these  producers  in spring  1995 on account  of  market  prices  which were 
extremely  low  for  the  time of year.  The  premium  is confined  to  the  1995  marketing  year. 

FINANCIAL  IMPLICATIONS 

5.0. 

EXPENDITURE 
-  CHARGED  TO THE  EC  BUDGET 

PERIOD  OF  12 
MONTHS 

million ecu 

9.5 

CURRENT 
FINANCIAL 
YEAR 
(%) 
million  ecu 

9.5 

FOLLOWING 
FINANCIAL 
YEAR 

million  ecu 

-  NATIONAL  ADMINISTRATION 
-  OTHER 

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

ESTIMATED  EXPENDITURE 
ESTIMATED  REVENUE 

1998 

1999 

2000 

2001 

METHOD  OF  CALCULATION: 
The  cost  of  the  measure  is estimated  as  follows: 
Ireland:  1 120 000 head  x ECU  6.5/head  = ECU  7.3  million  (A) x 1.013= 
Northern  Ireland:  320 000  head  x ECU  6.5/head  =  ECU  2.1  million  (A)  x  1.016 

ECU  7.4  million 
ECU  2.1  million 
ECU  9.5  million 

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? 

IS A SUPPLEMENTARY  BUDGET  NECESSARY? 

WILL  FUTURE  BUDGET  APPROPRIATIONS  BE  NECESSARY? 

VEfc/NO 

YES/NO 

YES/NO 

YES/NO 

5.1. 

5.0.1. 
5.1.1. 

5.2. 

6.0. 

(».l. 

6.2. 

6.3. 

OBSERVATIONS: 

ISSN  0254-1475 

COM(96)  152 final 

DOCUMENTS 

EN 

03 

Catalogue number  :  CB-CO-96-162-EN-C 

ISBN 92-78-02557-7 

Office  for Official  Publications of the European Communities 

L-2985 Luxembourg 

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