DRAFT AMENDING BUDGET N° 5 TO THE GENERAL BUDGET 2012 GENERAL STATEMENT OF REVENUE STATEMENT OF EXPENDITURE BY SECTION Section III – Commission
Date: 2012-09-19
Institutions: Directorate-General for Budget, European Commission
Subjects: European Commission, amending budget, budgetary expenditure, draft budget (EU)

EUROPEAN COMMISSION 

Brussels, 19.9.2012 
COM(2012) 536 final 

DRAFT AMENDING BUDGET N° 5 
TO THE GENERAL BUDGET 2012 

GENERAL STATEMENT OF REVENUE 

STATEMENT OF EXPENDITURE BY SECTION 
Section III – Commission 

EN 

   EN 

 
 
 
  
 
 
DRAFT AMENDING BUDGET N° 5 
TO THE GENERAL BUDGET 2012 

GENERAL STATEMENT OF REVENUE 

STATEMENT OF EXPENDITURE BY SECTION 
Section III – Commission 

2 

 
 
  
 
 
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 20112, 

the amending budget No 1/20123 adopted on 20 April 2012, 

the amending budget No 2/20124, adopted on 12 June 2012, 

the amending budget No 3/20125, adopted on 5 July 2012, 

the draft amending budget No 4/20126, adopted on 20 June 2012, 

The  European  Commission  hereby  presents  to  the  budgetary  authority  the  Draft  Amending 
Budget No 5 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 
3 
4 
5 
6 

OJ L 248, 16.9.2002, p. 1. 
OJ L 56, 29.2.2012, p. 1. 
OJ L 184, 13.7.2012, p. 1. 
OJ L 214, 10.8.2012, p. 1. 
OJ L 221, 17.8.2012, p. 1. 
COM(2012) 340 final. 

3 

 
 
  
 
 
 
 
                                                 
TABLE OF CONTENTS 

1. 

INTRODUCTION ....................................................................................................................................................... 5 

2.  MOBILISATION OF THE EU SOLIDARITY FUND............................................................................................ 5 

3. 

FINANCING OF THE EU SOLIDARITY FUND ................................................................................................... 7 

4.  MODIFICATION OF A BUDGET LINE................................................................................................................. 7 

5. 

SUMMARY TABLE BY HEADING OF THE FINANCIAL FRAMEWORK..................................................... 9 

4 

 
 
  
 
1. 

INTRODUCTION  

Draft Amending Budget (DAB) No 5 for the year 2012 concerns the following: 

–  Mobilisation  of  the  EU  Solidarity  Fund  for  an  amount  of  EUR 670 192 359  in  commitment  and 
payment  appropriations  relating  to  the  series  of  earthquakes  in  Emilia-Romagna,  Italy  in  May 
2012. 

–  Modification of the budget line 16 05 03 01 – Preparatory action – European Year of Volunteering 
2011 to replace the "dash" for payments on the line with a token entry (p.m.), in order to allow the 
final payments to be made. 

2. 

MOBILISATION OF THE EU SOLIDARITY FUND 

On 20 May 2012, a heavy earthquake with a magnitude of 5.9 on the Richter scale affected wide parts 
of  Northern  Italy  and  caused  severe  damage  in  many  towns  and  villages  in  particular  around  the 
epicentre,  mostly  in  the  provinces  of  Modena  and  Ferrara  in  the  region  of  Emilia-Romagna.  On  29 
May,  a  second  strong  earthquake  with  a  magnitude  of  5.8  on  the  Richter  scale  occurred  with  the 
epicentre  slightly  to  the  west.  Both  events  were  followed  by  several  serious  aftershocks.  The 
earthquakes caused 27 deaths, an estimated 350 people were injured and over 45 000 people had to be 
evacuated.  There  was  serious  and  widespread  damage  to  buildings,  infrastructure,  businesses, 
industrial facilities, agriculture and to the important cultural heritage sector. 

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) 

The  application  from  Italy  was  received  at  the  Commission  on  27  July  2012,  within  the 
deadline of 10 weeks after the first damage was recorded on 20 May 2012. 

The earthquakes are of natural origin and therefore fall within the main field of application of 
the Solidarity Fund. The two major quakes and the hundreds of aftershocks occurred within a 
few weeks and affected an area concentrated in two provinces of Emilia-Romagna with effects 
spreading  out  into  the  neighbouring  provinces  and  the  regions  of  Veneto  and  Lombardia. 
Following  the  established  policy  under  the  Solidarity  Fund  when  several  events  of  the  same 
nature affect the same area and happen during a relatively short period of time, these events 
are regarded as a single disaster. 

Total direct damage is the basis for the calculation of the amount of financial assistance. The 
Italian  authorities  estimated  the  total  direct  damage  at  EUR 13 273 736 063.  This  amount 
represents 0,86 % of Italy's GNI and exceeds by almost four times the threshold for mobilising 
the Solidarity Fund of EUR 3 607 million (i.e. EUR 3 billion in 2002 prices) applicable to Italy 
in 2012. As the estimated total direct damage exceeds the threshold, the disaster qualifies as a 
“major natural disaster” and thus falls within the main field of application of Regulation (EC) 
No 2012/2002. 

(4) 

The application contains a rather detailed description of the impact of the disaster and a break-
down  of  estimated  damages  by  sector  and  region.  Aggregated  information  from  the  national 
Civil  Protection  Department  has  been  taken  into  account.  According  to  this  information,  the 

5 

 
 
  
 
earthquakes  have  caused  severe  destruction  to  basic  infrastructure,  private  homes,  public 
buildings, businesses and the significant cultural heritage of the area. They have caused serious 
harm  to  the  population,  affecting  almost  1  million  people  in  106  municipalities  within  6 
administrative  provinces  in  the  Regions  of  Emilia-Romagna,  Veneto  and  Lombardia.  By  far 
the biggest part of the damage (nearly 92 %) was recorded in Emilia-Romagna, particularly in 
the provinces of Modena, Ferrara, Bologna and Reggio Emilia. Lombardia and Veneto were 
affected to a lesser extent with nearly 8 % and 0,4 % of total damage respectively. In Emilia-
Romagna  alone,  the  earthquakes  led  some  45  000  people  to  evacuate  their  homes  and  seek 
temporary housing solutions. Much of the population has found independent accommodation 
where  they  will  receive  government  support  while  some  16  000  people  have  applied  for 
assistance, so that some 90 emergency camps and indoor accommodation facilities had to be 
set up by the emergency services. 

The  affected  area  is  densely  populated  and  has  a  highly  developed  economy  with  a  great 
number of companies in the various industrial, manufacturing and craft sectors, many of which 
are of national importance, and which were greatly affected by the unprecedented damage and 
collapse  of  a  large  part  of  the  industrial  buildings.  There  is  the  risk  of  relocation  of  such 
activities to other areas. Damage to agricultural businesses was significant and is expected to 
lead to a dramatic impact on products such as Grana Padano and Parmigiano Reggiano cheeses 
and  balsamic  vinegar.  Overall,  the  disaster  is  expected  to  cause  a  substantial  drop  in 
production, commerce, agriculture and  other economic activities. Of particular importance is 
the  damage  caused  to  the  area's  rich  cultural  heritage.  Its  assessment  is  particularly  difficult 
and  this  point  is  described  in  detail  in  the  application.  For  Emilia-Romagna  alone,  relevant 
damage is currently estimated at EUR 2 075 million. 

The  Commission  services  came  to  the  conclusion  that  -  taking  into  consideration  the  size  of 
the  event  and  the  limited  time  to  assess  the  damages  -  the  methods  used  by  the  Italian 
authorities for estimating the different categories of damage are generally sufficiently detailed 
and plausible. 

The cost of essential emergency operations eligible under Article 3(2) of Regulation (EC) No 
2012/2002 has been estimated by the Italian authorities at EUR 714 672 825 and is presented 
broken down into the 4 categories laid down by the Regulation: A) immediate restoration to 
working  order  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.  By  far  the  largest  share  of  the  cost  of  emergency  operations  of  over 
EUR 465 million  concerns  the  activities  relating  to  temporary  accommodation  for  some  43 
000  people  for  up  to  3  years,  of  which  some  EUR 155 million  for  modular  housing  units. 
Nearly EUR 90 million relate to repairs of basic infrastructure and over EUR 60 million to the 
cost  of  the  rescue  services.  The  types  of  operation  effectively  to  be  financed  from  the  Fund 
will be defined in the Implementation Agreement. 

(5) 

(6) 

(7) 

(8) 

The  affected  zone  is  eligible  as  "Competitiveness  and  Employment  Regions"  under  the 
Structural Funds (2007-2013). 

(9) 

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

In conclusion, for the reasons set out above, it is proposed to accept the application submitted by Italy 
relating to the series of earthquakes in May 2012 as a “major disaster” and to propose the mobilisation 
of the Solidarity Fund.  

6 

 
 
  
 
3. 

FINANCING OF THE EU SOLIDARITY FUND 

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 

13 113,498 
 million 

Threshold 

Amount based 
on 2,5 % 

Amount based  
on 6 % 

Total amount of
aid proposed 

(EUR) 

3 606 million 

90 165 575  

580 026 784 

670 192 359  

670 192 359 

Italy - 
earthquakes 
2012 
Total 

As  to  the  financing  of  the  corresponding  payment  appropriations,  the  Commission  services  are 
currently in the process of updating their forecasts of payment needs until the end of 2012, and submit 
their requests to adjust payment appropriations. 

A preliminary analysis of the possibility to match increased needs for payment appropriations on some 
budget lines, with amounts on other lines which would otherwise remain unused, points to an overall 
shortage of payment appropriations at year-end, which the Commission intends to cover by means of a 
draft amending budget (DAB 6/2012), to be presented by mid-October 2012.  

As  a  consequence,  the  Commission  proposes  a  corresponding  increase  in  the  level  of  payment 
appropriations to finance the mobilisation of the Solidarity Fund. 

The  Commission    calls  for  swift  action  to  provide  support  to  the  affected  regions  and  ensure  the 
payment  of  the  support,  once  this  proposal  is  adopted.  However,  in  the  case  of  late  adoption  of  the 
proposal, and of the conclusion of the implementation agreement with the Member State concerned, it 
may  be  necessary  to  have  recourse  to  the  provisions  of  Article  9  of  the  Financial  Regulation 
(carryover of appropriations). 

4. 

MODIFICATION OF A BUDGET LINE 

The preparatory action European Year of Volunteering 2011 was created in 2010. In accordance with 
article 49 of the Financial Regulation, the relevant commitment appropriations for a preparatory action 
may  be  entered  in  the  budget  for  not  more  than  three  successive  financial  years.  However,  the 
finalisation of payments can continue thereafter. 

Among  other  actions,  a  grant  agreement,  covering  the  coordination  of  civil  sociey  activities  at 
European  level  in  the  framework  of  the  European  Year  of  Volunteering  2011  (developing  a  policy 
agenda for volunteering in Europe, mobilising and capacity building and dissimination), was signed 
with the Alliance (European Centre of Volunteering) in 2010.  

The pre-financing was paid in 2010. The final report, together with the request for final payment, was 
received only in late June 2012. 

7 

 
 
  
 
 
 
 
 
 
 
 
 
 
 
In order to cover this final payment the Commission will make an internal transfer within the same 
budget  chapter.  However,  in  accordance  with  article  25  of  the  Financial  Regulation,  a  transfer  can 
only be made to a budget line for which there are authorised appropriations, or which carries a token 
entry (p.m.). In the 2012 budget, the line in question, 16 05 03 01 – Preparatory action – European 
Year  of  Volunteering  2011  only  foresees  a  "dash"  in  payment  appropriations,  and  so  no  transfer  is 
possible. Therefore, it is proposed to replace this with a token entry (p.m.) to allow for a transfer. 

8 

 
 
  
 
5. 

SUMMARY TABLE BY HEADING OF THE FINANCIAL FRAMEWORK 

Financial framework 
Heading/subheading 

2012 Financial framework 

Budget 2012 (incl. AB 1-3/2012 and 
DAB 4/2012) 

DAB 5/2012 

Budget 2012 
(incl. AB 1-3/2012 and DAB 4-5/2012) 

CA 

PA 

CA 

PA 

CA 

PA 

CA 

PA 

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

1b. Cohesion for growth and employment 

Margin 

Margin 
Total 
Margin7 

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 
Margin8   

Margin9 

Margin10 
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

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

-41 576 141  

11 482 916 106

43 835 746 321

55 318 662 427

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

-41 576 141  

11 482 916 106 

43 835 746 321 

55 318 662 427 

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
715 498 462
1 563 220
2 083 305 022

39 756 660  

835 577 878

666 761 862

670 192 359

670 192 359

1 502 339 740

670 192 359

670 192 359

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

6 955 083 523

8 277 736 996

129 088 042 948
12 445 957 052

670 192 359

670 192 359

1 367 806 560
38 193 440
1 385 690 821
1 563 220
2 753 497 381

39 756 660  

9 405 937 000
-150 000 000
8 279 641 996
327 358 004
148 570 426 703
1 209 764 338

835 577 878 

1 336 954 221 

2 172 532 099 

6 955 083 523 

8 277 736 996 

129 758 235 307 
12 445 957 052 

7 

8 
9 

10 

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. 

9