DRAFT AMENDING BUDGET N° 2TO THE GENERAL BUDGET 2012 STATEMENT OF EXPENDITURE BY SECTIONSection III – Commission
Date: 2012-03-16
Institutions: European Commission
Subjects: European Commission, amending budget, budgetary expenditure, draft budget (EU)

EUROPEAN COMMISSION 

Brussels, 16.3.2012 
COM(2012) 125 final 

DRAFT AMENDING BUDGET N° 2 
TO THE GENERAL BUDGET 2012 

STATEMENT OF EXPENDITURE BY SECTION 
Section III – Commission 

 
 
 
 
  
 
DRAFT AMENDING BUDGET N° 2 
TO THE GENERAL BUDGET 2012 

STATEMENT OF EXPENDITURE BY SECTION 
Section III – Commission 

Having regard to: 

– 

– 

– 

– 

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  2012  adopted  on 
1 December 2011, 

the draft amending budget No 1/20122, adopted on 27 January 2012, 

The  European  Commission  hereby  presents  to  the  budgetary  authority  the  Draft  Amending 
Budget No 2 to the 2012 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 this statement is attached for information as a budgetary annex. 

1 
2 

OJ L 248, 16.9.2002, p. 1. 
COM(2012) 31 final. 

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TABLE OF CONTENTS 

1. 

INTRODUCTION ....................................................................................................................................................... 1 

2.  MOBILISATION OF THE EU SOLIDARITY FUND............................................................................................ 1 

3. 

4. 

FINANCING................................................................................................................................................................ 1 

SUMMARY TABLE BY HEADING OF THE FINANCIAL FRAMEWORK..................................................... 1 

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1. 

INTRODUCTION  

Draft Amending Budget (DAB) No 2 for the year 2012 covers the mobilisation of the EU Solidarity 
Fund  for  an  amount  of  EUR 18 061 682  in  commitment  and  payment  appropriations  relating  to 
flooding in Italy (Liguria and Tuscany) in October 2011. 

2. 

MOBILISATION OF THE EU SOLIDARITY FUND 

On 25 October 2011, an extreme weather system centred over north-west Italy led to a vast amount of 
rain falling within just a few hours. Worst affected, were the provinces of La Spezia in Liguria and 
Massa  Carrara  in  Tuscany.  As  a  result  of  the  deluge,  many  small  upland  rivers  burst  their  banks, 
carrying enormous quantities of water, mud and debris to the valleys below, and causing two major 
rivers – the Vara and the Magra – to flood several towns. Also severely hit, was the nearby area of 
Cinque Terre, in the province of La Spezia. The resulting disaster caused serious damage to residential 
homes,  businesses  and  agriculture  and  the  disruption  of  major  transport  links  and  essential  public 
infrastructure networks. Parts of the disaster zone concern the area of "Cinque Terre", an integral part 
of the Italian Riviera and UNESCO World Heritage site.  

Subsequently,  Italy  submitted  an  application  for  financial  assistance  from  the  European  Union 
Solidarity Fund. 

The Commission services  have  carried  out a thorough  examination  of  the  application  in  accordance 
with Council Regulation (EC) No 2012/2002  and in particular with Articles 2, 3 and 4 thereof. The 
most important elements of the assessment can be summarised as follows: 

(1) 

(2) 

(3) 

(4) 

The  application  was  received  at  the  Commission  on  22  December  2011,  well  within  the 
deadline of 10 weeks after the first damage was recorded on 25 October 2011.  

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

For  the  designated  disaster  zone  comprising  neighbouring  parts  of  Liguria  and  Tuscany  the 
Italian authorities estimated total direct damage at EUR 722 467 299. This amount represents 
20,43 %  of  the  normal  threshold  of  EUR 3,536 billion  applicable  to  Italy  in  2011  for 
mobilising the Solidarity Fund (i.e. EUR 3 billion in 2002 prices). 

the  conditions  for  mobilising 

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  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 area in Italy does 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) 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 

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the  national  authorities,  while  the  former  can  be  considered  for  support  under  the  Solidarity 
Fund.  In  order  to  meet  the  Solidarity  Fund  criteria,  the  Italian  authorities  based  their 
application on an area of 20 municipalities that were most hardly hit by the disaster. The area 
is situated on the coastal strip of Cinque Terre, the hydrographical basin of the Vara river in 
the Province of La Spezia and the Lunigiana area in the Province of Massa Carrara with a total 
population of over 52 000 inhabitants. 

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 Italian application states that a total of 28 
858  inhabitants  in  20  municipalities  were  directly  affected  by  the  disaster  out  of  a  total 
population of 52 251. The evidence provided appears plausible. It can therefore be concluded 
that the major part of the population was directly affected and that this condition is met. 

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 
and  interruption  of  the  utility  networks  and  other  infrastructures  (such  as  in  the  fields  of 
transport,  water  and  electricity),  the  impact  of  the  floods  on  the  natural  environment,  the 
effects  on  businesses  and  tourism  as  well  as  the  destruction  of  residential  homes.  In  the 
affected area of Liguria, the disaster caused 13 casualties and over one thousand people had to 
leave their homes. In Tuscany, two casualties and the need to evacuate over 300 people were 
reported.  Homes  were  destroyed,  significantly  damaged  or  made  uninhabitable,  making  it 
impossible for residents to return to their homes in the near future. Roads were damaged, the 
motorway A15 was partially closed and railway networks were interrupted, embankments and 
bridges collapsed. Public networks like water, gas, electricity, sewerage systems and treatment 
plants  were  also  interrupted.  846  mostly  family  run  SMEs  with  1 209  employees  severely 
suffered  from  the  consequence  of  the  floods.  Over  two  thirds  of  these  are  directly  linked  to 
tourism, one of the leading sectors of the area. Furthermore, this extraordinary natural disaster 
caused heavy damages to beaches and trekking routes, both backbones of the tourism industry. 
The Italian authorities estimate a loss in GDP of around 20 % and 25 % in revenues in 2012. 
Full return to normal conditions is expected to take up to a year or even longer. 

The  cost  of  operations  eligible  under  Article  3(2)  of  Regulation  (EC)  No  2012/2002  is 
estimated at EUR 511,4 million 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  highest  costs  are  estimated  for  the  restoration  of  transport 
and preventive infrastructures as well as for cleaning up. 

The  affected  region  is  eligible  as  a  "Competitiveness  and  Employment  region"  under  the 
Structural Funds (2007-2013). The Italian authorities have signalled to the Commission their 
intention to reallocate funding from the Structural Fund programmes for Liguria and Tuscany 
towards recovery measures. 

(6) 

(7) 

(8) 

(9) 

(10)  The Italian authorities indicated that there is no insurance coverage of eligible cost. 

In conclusion, for the reasons set out above, the flooding disaster referred to in the application can be 
considered to be extraordinary within the meaning of the Regulation and to meet the conditions set out 
by Article 2(2), last subparagraph, of Regulation (EC) No 2012/2002 for exceptionally mobilising the 
Solidarity Fund. 

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3. 

FINANCING 

The total annual budget available for the Solidarity Fund is EUR 1 000 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  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: 

Direct damage 
accepted 

Threshold 

Amount based 
on 2,5 % 

Amount based  
on 6 % 

Total amount of
aid proposed 

(EUR) 

722,467 million 

3 536 million 

18 061 682  

- 

18 061 682  

18 061 682  

Liguria and 
Tuscany 
flooding 2011 
Total 

At  this  stage  in  the  year,  and  on  the  basis  of  the  implementation  forecasts,  there  is  no  source  of 
possible redeployment of the required payment appropriations.  On the contrary, all indicators point to 
a likely shortage of payment appropriations later in the year. 

As  a  consequence,  the  Commission  proposes  a  corresponding  increase  in  the  level  of  payment 
appropriations.  

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4. 

SUMMARY TABLE BY HEADING OF THE FINANCIAL FRAMEWORK 

Financial framework 
Heading/subheading 

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

1b. Cohesion for growth and employment 

Margin 

Margin 
Total 
Margin3 

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 

Total 
Margin 

3b. Citizenship 

4. EU AS A GLOBAL PLAYER 

5. ADMINISTRATION 

Margin 

Margin 
Total 
Margin4   

Margin5 

Margin6 
TOTAL 

Margin   

14 853 000 000

52 761 000 000

67 614 000 000

48 093 000 000

60 810 000 000

1 406 000 000

699 000 000

2 105 000 000

8 997 000 000

8523 000 000

148 049 000 000

141 360 000 000

2012 Financial framework 

Budget 2012 (incl. DAB 1/2012) 

DAB 2/2012 

CA 

PA 

CA 

PA 

CA 

PA 

15 403 000 000
-50 000 000
52 752 576 141
8 423 859
68 155 576 141

-41 576 141  

11 500 977 788

43 835 746 321

55 336 724 109

Budget 2012 
(incl. DAB 1-2/2012) 
CA 

PA 

15 403 000 000
-50 000 000
52 752 576 141
8 423 859
68 155 576 141

-41 576 141  

11 500 977 788 

43 835 746 321 

55 336 724 109 

43 969 637 305

43 875 978 049

43 969 637 305

43 875 978 049 

59 975 774 185

57 034 220 262

834 225 815  

59 975 774 185

57 034 220 262 

834 225 815  

1 367 806 560
38 193 440
697 436 780
1 563 220
2 065 243 340

39 756 660  

835 577 878

648 700 180

18 061 682 

18 061 682

1 484 278 058

18 061 682 

18 061 682

9 405 937 000
-150 000 000
8 279 641 996
327 358 004
147 882 172 662
1 209 764 338

6 955 083 523

8 277 736 996

129 088 042 948
12 445 957 052

18 061 682 

18 061 682

1 367 806 560
38 193 440
715 498 462
1 563 220
2 083 305 022

39 756 660  

9 405 937 000
-150 000 000
8 279 641 996
327 358 004
147 900 234 344
1 209 764 338

835 577 878 

666 761 862 

1 502 339 740 

6 955 083 523 

8 277 736 996 

129 106 104 630 
12 445 957 052 

3 

4 
5 

6 

The European Globalisation adjustment Fund (EGF) is not included in the calculation of the margin under Heading 1a (EUR 500 million). EUR 50 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 2012 margin for heading 4 does not take into account the appropriations related to the Emergency Aid Reserve (EUR 258,9 million). EUR 150 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 84 million for the staff 
contributions to the pension scheme. 

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