DRAFT AMENDING BUDGET N° 2 TO THE GENERAL BUDGET 2011 STATEMENT OF EXPENDITURE BY SECTION Section III - Commission
Date: 2011-03-25
Institutions: European Commission
Subjects: European Commission, amending budget, budgetary expenditure, budgetary resources, draft budget (EU), general budget (EU)

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EUROPEAN COMMISSION 

Brussels, 25.3.2011 
COM(2011) 154 final 

DRAFT AMENDING BUDGET N° 2 
TO THE GENERAL BUDGET 2011 

STATEMENT OF EXPENDITURE BY SECTION 
Section III - Commission 

(presented by the Commission) 

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DRAFT AMENDING BUDGET N° 2  
TO THE GENERAL BUDGET 2011 

STATEMENT OF EXPENDITURE BY SECTION 
Section III - Commission 

Having regard to: 

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the Treaty on the Functioning of the European Union, and in particular Article 314 
thereof,  in  conjunction  with  the  Treaty  establishing  the  European  Atomic  Energy 
Community, and in particular Article 106a thereof, 

the  Council  Regulation  (EC,  Euratom)  No  1605/2002  of  25  June  2002  on  the 
Financial Regulation applicable to the general budget of the European Communities1, 
and in particular Article 37 thereof, 

the  general  budget  of  the  European  Union  for  the  financial  year  2011  adopted  on 
15 December 2010, 

the draft amending budget No 1/20112, adopted on 14 January 2011. 

The  European  Commission  hereby  presents  to  the  budgetary  authority  the  Draft  Amending 
Budget No 2 to the 2011 budget. 

CHANGES  TO  THE  STATEMENT  OF  REVENUE  AND  EXPENDITURE  BY 
SECTION 

The  changes  to  the  statement  of  revenue  and  expenditure  by  section  are  available  on  EUR-
Lex (http://eur-lex.europa.eu/budget/www/index-en.htm). An English version of the changes 
to these statements by section is attached for information as a budgetary annex. 

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OJ L 248, 16.9.2002, p. 1. 
COM(2011) 9 

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TABLE OF CONTENTS 

Introduction .................................................................................................................. 3 

Mobilisation of the EU Solidarity Fund....................................................................... 3 

Slovenia........................................................................................................................ 3 

Croatia .......................................................................................................................... 4 

The Czech Republic ..................................................................................................... 5 

Conclusion.................................................................................................................... 7 

Financing...................................................................................................................... 7 

Summary table by heading of the Financial Framework ............................................. 8 

INTRODUCTION 

1. 

2. 

2.1. 

2.2. 

2.3. 

2.4. 

3. 

4. 

1. 

Draft  Amending  Budget  (DAB)  No 2  for  the  year  2011  covers  the  mobilisation  of  the  EU 
Solidarity  Fund  for  an  amount  of  EUR 19 546 647 
in  commitment  and  payment 
appropriations  relating  to  the  effects  of  heavy  rainfalls  in  Slovenia,  Croatia  and  the  Czech 
Republic. 

2. 

MOBILISATION OF THE EU SOLIDARITY FUND 

2.1. 

Slovenia 

(1) 

(2) 

(3) 

(4) 

The  application  was  received  at  the  Commission  on  26  November  2010,  within  the 
deadline of 10 weeks after the first damage was recorded on 17 September 2010. The 
Slovenian authorities claim assistance for damages caused by flooding which followed 
intense rainfall during the period from 17 September 2010 to 20 September 2010.  

The disaster is of natural origin and therefore falls within the field of application of the 
Solidarity Fund. 

The  Slovenian  authorities  estimate  the  total  direct  damage  caused  by  the  disaster  at 
EUR 251 300 861.  This  amount  represents  115,45 %  of  the  normal  threshold  for 
mobilising the Solidarity Fund applicable to Slovenia in 2010 of EUR 217.669 million 
(i.e. 0,6 % of Slovenian GNI according to 2008 data). 

As the estimated total direct damage of EUR 251.3 million exceeds the threshold for 
mobilising the Solidarity Fund applicable to Slovenia the disaster qualifies as a “major 
natural disaster” under the terms of Council Regulation (EC) No 2012/2002 and falls 
thus within the main field of application of the Solidarity Fund. Total direct damage is 
the  basis  for  the  calculation  of  the  amount  of  financial  assistance.  The  financial 
assistance may only be used for essential emergency operations as defined in Article 3 
of the Regulation. 

(5) 

As  regards  the  impact  of  the  disaster,  the  flooding  affected  137  of  Slovenia's  210 
municipalities and caused widespread damage to infrastructure, businesses and private 

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property.  In  total,  8 241  buildings  were  flooded,  including  the  premises  of  127 
businesses. In terms of infrastructure, 91 bridges were damaged as well as 550 km of 
state road and 2000 km of local roads. 296 residents were evacuated from their homes. 
Furthermore, Slovenia suffered damage to cultural heritage in several areas, including 
the  flooding  of  the  entire  historic  centres  of  Kostanjevica  na  Krki  and  Krško,  and 
damage  to  the  Salt  Pans  near  Piran.  The  Slovenian  authorities  have  submitted  a 
rigorous application and have provided convincing evidence of the major nature of this 
disaster. 

(6) 

(7) 

The cost of operations eligible under Article 3(2) of Regulation (EC) No 2012/2002 is 
estimated  at  EUR 171.3 million  and  broken  down  by  type  of  operation.  The  largest 
share of the cost of emergency operations (over EUR 73 million) concerns the cost in 
the field of water and waste water management. 

The affected region is eligible as a "Convergence Region" under the Structural Funds 
(2007-2013).  The  Slovenian  authorities  have  not  signalled  to  the  Commission  any 
intention to use other sources of Community funding to deal with the consequences of 
the floods. 

(8) 

The Slovenian authorities indicated that there is no insurance coverage of eligible cost. 

2.2. 

Croatia 

Croatia  faced  intense  rain  from  17  to  22  September  2010  causing  severe  floods  that 
particularly  struck  the  area  of  Western  Croatia.  The  disaster  caused  significant  damages  to 
infrastructure, to the agriculture sector and to private property. 

(1) 

(2) 

(3) 

The application for financial assistance from the European Union Solidarity Fund was 
presented to the Commission on 25 November 2010 within the deadline of 10 weeks 
after the first damage was recorded on 17 September 2010. 

The  disaster  is  of  natural  origin.  The  Croatian  authorities  estimate  the  total  direct 
damage  caused  by  the  disaster  at  EUR 47 002 839.  As  this  amount  is  below  the 
threshold  of  EUR 275.804 million  (i.e.  0,6 %  of  Croatia's  GNI  of  2008)  the  disaster 
does  not  qualify  as  a  "major  natural  disaster"  according  to  Council  Regulation  (EC) 
No 2012/2002. However, Croatia was affected by the same flooding disaster which led 
to  the  major  disaster  in  Slovenia.  Therefore,  the  condition  set  out  in  Article  2(2) 
second  subparagraph  of  Council  Regulation  (EC)  No 2012/2002,  whereby  a  country 
affected  by  the  same  major  disaster  as  a  neighbouring  country  may  exceptionally 
benefit from Solidarity Fund aid, was found to be met. As a country in the process of 
negotiating  its  accession  to  the  EU  Croatia  is  eligible  for  EU  Solidarity  Fund 
assistance. 

As  regards  the  impact  and  consequences  of  the  flooding,  the  Croatian  authorities 
report that over a thousand private homes (houses and apartments) were flooded and 
many families needed to be evacuated. It was reported that the Museum "Lapidarium" 
in  Novigrad  was  heavily  affected  by  the  floods.  Significant  damages  were  caused  to 
energy,  water  and  waste  water  infrastructure,  transport,  education  and  health 
infrastructure  causing  e.g.  electricity  blackouts  and  blockages  of  road  traffic  which 
made it difficult to take immediate action. Most damages however were caused to the 
farming sector which amounts to over EUR 7 million of the total damages. 

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(4) 

The  cost  of  essential  emergency  operations  eligible  under  Article  3(2)  of  Council 
Regulation  (EC)  No  2012/2002  has  been  estimated  by  the  Croatian  authorities  at 
EUR 28 647 292  and  has  been  presented  broken  down  by  type  of  operation.  The 
largest share of cost concerns operations for cleaning-up of disaster stricken zones and 
are estimated at over EUR 16 million. 

(5) 

The Croatian authorities indicated that no other Community funds (e.g. IPA funding) 
are used in dealing with the immediate consequences of the flooding disaster. 

2.3. 

The Czech Republic 

At  the  beginning  of  August  2010,  the  northern  parts  of  the  Czech  Republic  experienced 
unusual  heavy  rainfall  triggering  rivers  to  burst  their  banks,  forcing  people  to  leave  their 
homes  and  causing  damage  to  public  infrastructures,  private  homes,  agriculture  and 
businesses. 

(1) 

(2) 

(3) 

(4) 

The  application  was  received  at  the  Commission  on  14  October  2010,  within  the 
deadline of 10 weeks after the first damage was recorded on 7 August 2010. 

The disaster is of natural origin and therefore falls within the field of application of the 
Solidarity Fund. 

The  Czech  authorities  estimate  the  total  direct  damage  caused  by  the  disaster  at 
EUR 436 477 560.  This  amount  represents  53 %  of  the  normal  threshold  for 
mobilising  the  Solidarity  Fund  applicable  to  the  Czech  Republic  in  2010  of 
EUR 824.03 million (i.e. 0,6 % of GNI based on 2008 data). 

As  total  damage  remains  below  the  normal  threshold  for  mobilising  the  Solidarity 
Fund  the  application  was  examined  on  the  basis  of  the  criteria  for  so-called 
“extraordinary  regional  disasters”  laid  down  in  Article  2(2),  final  subparagraph,  of 
Regulation (EC) No 2012/2002 setting out the conditions for mobilising the Solidarity 
Fund  “under  exceptional  circumstances”.  Under  these  criteria,  a  region  can 
exceptionally  benefit  from  assistance  from  the  Fund  where  that  region  has  been 
affected by an extraordinary disaster, mainly a natural one, affecting the major part of 
its  population,  with  serious  and  lasting  repercussions  on  living  conditions  and  the 
economic stability of the region. The Regulation calls for special focus on remote and 
isolated regions such as the insular and outermost regions defined in Article 349 of the 
Treaty. The affected areas in the Czech Republic do not fall within this category. The 
Regulation  calls  for  "utmost  rigour"  in  assessing  applications  presented  under  the 
provisions for "extraordinary regional disasters". 

(5) 

As set out in the Annual Report on the Solidarity Fund (2002-2003)3 the Commission 
considers that, in order for the specific criteria for regional disasters to be meaningful 
in the national context, a distinction needs to be drawn between serious regional events 
and  those  that  are  merely  local.  In  accordance  with  the  principle  of  subsidiarity  the 
latter  are  the  responsibility  of  the  national  authorities,  while  the  former  can  be 
considered  for  support  under  the  Solidarity  Fund.  According  to  the  application  the 

3 

Annual  report  2002-2003  and  Report  on  the  experience  gained  after  one  year  of  applying  the  new 
instrument, COM(2004) 397 final of 26.5.2004 

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(6) 

(7) 

floods  affected  a  coherent  single  area  of  the  Czech  Republic,  namely  the  Liberec 
Region (Liberecký kraj) and the neighbouring District Děčín belonging to the Ústí nad 
Labem Region (Ústecký kraj). The Liberec Region shares its borders with Poland and 
Germany,  whereas  the  District  Děčín  is  bordering  on  Germany.  The  highest 
precipitation intensity and flooding occurred in the Nisa river basin and partly in the 
Elbe river basin. 

One  of  the  conditions  set  out  in  Regulation  (EC)  No  2012/2002  for  the  exceptional 
mobilisation  of  the  Solidarity  Fund  is  that  the  major  part  of  the  population  in  the 
region  to  which  the  application  relates  must  be  affected.  The  Czech  Republic's 
application states that in the Liberec Region 262 088 inhabitants in 81 municipalities 
were directly affected (out of a total of 439 027 inhabitants). In the District of Děčín 
43  municipalities  were  concerned  with  nearly  90  %  of  the  total  population  affected. 
The evidence provided is plausible and can be accepted. 

As  regards  the  requirement  to  demonstrate  serious  and  lasting  repercussions  on  the 
living  conditions  and  the  economic  stability  of  the  region,  the  application  highlights 
the  destruction  of  vital  infrastructures  (such  as  in  the  fields  of  transport,  water  and 
energy), the impact on businesses and the severe damage to a great number of family 
homes. It was reported that a total of 3 239 houses and 220 apartment buildings in the 
Liberec  region  and  1 199 houses  and  48  apartment  buildings  in  the  Děčín  district 
suffered  damages;  many  of  which  beyond  repair.  Nearly  2 500  persons  needed  to 
placed  in  provisional  accommodation.  The  supply  of  gas  and  electricity  was 
interrupted  and  numerous  individual  sources  of  drinking  water  (wells)  were 
contaminated.  In  the  Liberec  Region  7  bridges  on  main  roads  and  198  bridges  on 
secondary  roads  were  destroyed.  In  the  Děčín  district,  146 bridges  were  destroyed. 
195 km  of  roads  were  damaged.  A  railroad  section  was  closed  for  several  months. 
Private  companies  lost  machinery,  equipment,  inventory,  or  supplies  mostly  without 
having  been  insured  and  are  now  in  danger  of  having  to  close  down.  The  largest 
damage  with  respect  to  employment  occurred  in  tourism,  one  of  the  key  economic 
factors in the region. The floods resulted in decline of visitors in the Liberec region by 
more than 40 %. Major damages also affected the tourist infrastructure. In the field of 
agriculture, 165.5 ha of agricultural land were destroyed, 400 ha of cereal and 100 ha 
of  colza  could  not  be  harvested.  Overall,  a  15 %  economic  decline  occurred  in  the 
Liberec  region  within  2  months  after  the  floods.  Moreover,  recovery  is  seriously 
hampered by  the  economic downturn  of recent years and the lack of public funds to 
repair vital infrastructures and other damages quickly. Full return to normal conditions 
is expected to take several years. 

(8) 

The cost of operations eligible under Article 3(2) of Regulation (EC) No 2012/2002 is 
estimated  at  EUR 334 772 020  and  broken  down  into  4  categories:  A)  immediate 
restoration to working conditions of infrastructure, B) temporary accommodation and 
rescue  services,  C)  preventive  infrastructures  and  immediate  protection  of  cultural 
heritage and D) cleaning up of disaster stricken areas/zones. The largest share of the 
cost  of  emergency  operations  (EUR 195 million)  concerns  the  cost  in  the  field  of 
transport infrastructures. 

(9) 

The  affected  region  is  eligible  as  "Convergence  Region"  under  the  Structural  Funds 
(2007-2013). The Czech authorities declared that no financial means will be relocated 
to the relevant areas. 

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(10)  As regards a possible coverage of eligible damage by insurance, the Czech authorities 

indicated that there is no insurance coverage of eligible cost. 

2.4. 

Conclusion 

In conclusion, for the reasons set out above, it is proposed to accept the applications submitted 
by Slovenia, Croatia and the Czech Republic relating to the flooding disasters of August and 
September  2010  and  to  propose  the  mobilisation  of  the  Solidarity  Fund  for  each  of  these 
cases. 

3. 

FINANCING 

The total annual budget available for the Solidarity Fund is EUR 1000 million. As solidarity 
was the central justification for the creation of the Fund, the Commission takes the view that 
aid from the Fund should be progressive. That means that, according to previous practice, the 
portion  of  the  damage  exceeding  the  threshold  (0,6 %  of  the  GNI  or  EUR 3 billion  in  2002 
prices, whichever is the lower amount) should give rise to higher aid intensity than damage up 
to the threshold. The rate applied in the past for defining the allocations for major disasters is 
2,5 % of total direct damage under the threshold for mobilising the Fund and 6% above. The 
rate  applied  for  defining  the  allocations  for  exceptional  regional  disasters  or  neighbouring 
country disasters is 2,5 % of total direct damage. The methodology for calculating Solidarity 
Fund aid was set out in the 2002-2003 Annual Report on the Solidarity Fund and accepted by 
the Council and the European Parliament. 

It  is  proposed  to  apply  the  same  percentages  in  this  case  and  to  grant  the  following  aid 
amounts: 

Beneficiary State 

Direct damage 

Threshold 

Amount based 
on 2,5 % 

Amount based 
on 6 % 

(EUR) 
Total amount of
aid proposed 

Slovenia – September 
flooding 2010 
"major disaster" 
Croatia – September 
flooding 2010 
"neighbouring country 
criterion" 
The Czech Republic – 
August flooding 2010 
Total 

251 300 861 

217 669 000 

5 441 725 

2 017 912 

7 459 637 

47 002 839 

275 804 000 

1 175 071 

436 477 560 

824 029 000 

10 911 939 

- 

- 

1 175 071 

10 911 939 

19 546 647 

This amount of compensation will leave at least 25 % of the European Union Solidarity Fund 
available  for  allocation  during  the  last  quarter  of  the  year,  as  required  by  Article  4(2)  of 
Regulation (EC) 2012/2002. 

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4. 

SUMMARY TABLE BY HEADING OF THE FINANCIAL FRAMEWORK 

Financial framework 
Heading/subheading 

2011 Financial framework 

Budget 2011 
(incl. DAB 1/2011) 

DAB 2/2011 

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PA 

CA 

PA 

CA 

PA 

Budget 2011 
(incl. DAB 1-2/2011) 
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PA 

1. SUSTAINABLE GROWTH 
1a. Competitiveness for growth and 
employment 
1b. Cohesion for growth and employment 

Total 
Margin4 

2. PRESERVATION AND 
MANAGEMENT OF NATURAL 
RESOURCES 
Of which market related expenditure and 
direct payments 

3. CITIZENSHIP, FREEDOM, 
SECURITY AND JUSTICE 
3a. Freedom, Security and Justice 
3b. Citizenship 

4. EU AS A GLOBAL PLAYER6 

5. ADMINISTRATION7 

Total 
Margin 

Total 
Margin5   

Margin 

12 987 000 000

50 987 000 000
63 974 000 000

47 617 000 000

60 338 000 000

1 206 000 000
683 000 000
1 889 000 000

8 430 000 000

8 334 000 000

Margin 
TOTAL 

Margin   

142 965 000 000

134 280 000 000

13 520 566 270

11 627 802 798

13 520 566 270

11 627 802 798 

50 980 593 784
64 501 160 054

-27 160 054  

41 652 094 626
53 279 897 424

50 980 593 784
64 501 160 054

41 652 094 626 
53 279 897 424 

-27 160 054  

42 891 201 900

42 788 499 841

42 891 201 900

42 788 499 841 

58 659 248 389
1 678 751 611  

56 378 918 184

58 659 248 389
1 678 751 611  

56 378 918 184 

1 138 954 740
861 459 910
2 000 414 650

67 148 260  

8 758 125 360
-70 439 377
8 172 839 289
243 160 711
142 091 787 742
1 996 461 151

813 277 345
824 531 910
1 637 809 255

+18 371 576
+18 371 576

+18 371 576
+18 371 576

7 241 353 503

+1 175 071

+1 175 071

8 171 544 289

126 709 522 655
7 934 866 238

+19 546 647

+19 546 647

1 138 954 740
879 831 486
2 018 786 226

67 148 260  

8 759 300 431
-70 439 377
8 172 839 289
243 160 711
142 111 334 389
1 996 461 151

813 277 345 
842 903 486 
1 656 180 831 

7 242 528 574 

8 171 544 289 

126 729 069 302 
7 915 319 591 

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The  European  Globalisation  adjustment  Fund  (EGF)  is  not  included  in  the  calculation  of  the  margin  under  Heading  1a  (EUR  500  million).  EUR  34  million  above  the  ceiling  is 
financed by the mobilisation of the Flexibility Instrument. 
The European Union Solidarity Fund (EUSF) amount is entered over and above the relevant headings as foreseen by the IIA of 17 May 2006 (OJ C 139 of 14.6.2006) 
The  2011  margin  for  heading  4  does  not  take  into  account  the  appropriations  related  to  the  Emergency  Aid  Reserve  (EUR  253,9  million).  EUR  71  million  above  the  ceiling  is 
financed by the mobilisation of the Flexibility Instrument. 
For calculating the margin under the ceiling for heading 5, account is taken of the footnote (1) of the financial framework 2007-2013 for an amount of EUR 82 million for the staff 
contributions to the pension scheme. 

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