CELEX: 51992PC0478
Language: en
Date: 1992-11-20
Title: Proposal for a COUNCIL REGULATION (EEC) amending Regulation (EEC) No 2990/82 on the sale of butter at reduced prices to persons receiving social assistance

COMMISSION OF THE EUROPEAN COMMUNITIES
                                             C0M(92) 478 final
                                             Brussels, 20 November 1992
                  REPORT FROM THE COMMISSION TO THE COUNCIL
                                  concerning
                 application of Council Regulation 2990/82
                  concerning the sale of butter at reduced
              prices to persons receiving social assistance
                                Proposal for a
                           COUNCIL REGULATION (EEC)
 amending Regulation (EEC) No 2990/82 on the sale of butter at reduced prices
                     to persons receiving social assistance
                        (presented by the Commission)
 ---pagebreak---  1.   Background
   The market situation for milk in general and for butter in particular has
   in the past required a whole range of disposal measures notably for
   butter in order to increase the internal and external sales and
   consequently diminish the purchases into public intervention storage.
   The scheme allowing for sale of butter to persons receiving social
   assistance has been in operation since 197 8 and Article 3a of Council
   Regulation 2990/82, last modified by Regulation 3917/90, requires          that
   the Council, on the basis of a report from the Commission before
   31.12.1992, decides whether the subsidized sales under above mentioned
   regulation is to be continued.       Two reports have been forwarded to the
   council, one in December 1988 and one in October 1990 resulting in
   continuation of the scheme for two consecutive year periods ending
   31.12.1992.     Up until now the Regulation has only been applied in
   Ireland,    and national legislation opening possibilities for such sales
   in Belgium as well, was introduced in the beginning of 19 88 but the
   scheme has not been applied      in practise.     The following therefore refers
   to Ireland only.
2.   Criteria   for the determination    of entitlement
   Persons entitled to benefit from the scheme are those in receipt of
   social assistance under any of the following categories which provide         for
   social assistance payments :
            Old Age Pensions Acts, 1908 to 1978
            Unemployment Assistance Acts, 1933 to 1978
            Widows' and Orphans' Pension Acts, 1935 to 1978
            Deserted Wife's Allowance under the Social Welfare Act, 1970
            Social Assistance Allowance for Unmarried Mothers Social Welfare
            Act, 1973
            Prisoner's Wife's Allowance under the Social Welfare Act 1974
            Single Woman's Allowance under the Social Welfare Act 1974
            Social Welfare (Supplementary Welfare Allowance) Act 1975
            Disabled Persons (Maintainance) Allowances payable under
            Regulations made in pursuance of Section 69 of the Health Act
            1970
            Infectious     Diseases    (Maintenance)     Allowance   payable   under
            Regulations made in pursuance of Section 44 of the Health Act,
            1947
     Procedure   for implementation   and control   of the scheme
  A system of vouchers entitling two pounds of butter per month to be
  purchased at the normal retail price, less the amount of the subsidy, are
  supplied to those persons determined under the criteria set out at point
  2 above by the competent authority.        Vouchers are also supplied for each
  qualified dependent of the social assistance recipient.          Vouchers are
  valid for the month they are issued and the following two months.
 ---pagebreak---    In 1990 the system of control was improved and involves checks oi water
   marked and security printed vouchers, numbers, amounts, quantities and
   eligibility of the numbered vouchers. These checks will, together with
   declarations from the retailers selling the butter and on the spot checks
   carried out by the competent authorities, ensure that the scheme is not
   abused.
     Developments     in the butter and yellowfat     market   in Ireland
   In accordance with Article 4(3) of Regulation (EEC) n° 1898/87 the Member
   States shall forward to the commission information concerning the
   developments on the butter and yellow fat market.
   The information received from the Irish authorities concerning
   developments in market shares of butter, low-fat butter, margarine and
   fat mixtures shows the following development between 19 87 and 199 0.
   Butte r                  Low-fat   butter       Margarine             Fat
                                                                         Mixture!S
   tonnes   (%)             tonnes (%)            tonnes   (%)           tonnes   (%)
   1987  20,500   (42%)     2,000   (4%)          14,900   (31%)         11,000   (23%)
   1988  16,325   (33%)     2,750   (6%)          14,200   (31%)         15,000   (30%)
   1989  13,235   (27.5%)   1,860   (4%)          15,700   (32.5%)       17,500   (36%)
   1990  12,000   (25.3%)   1,575   (3,3%)        15,100   (31.8%)       18,825  (39.6%)
 It is noted that the total yellow fat market between 1987 and 1990 shows a
 decline of 1,9% while the fat mixtures have taken a continuance                    higher
 market    share compared      to that of butter while the market               share of
 margarine has been stable.         The fat mixtures generally contain butter or
 cream and vegetable fat and have been principally marketed on the basis of
 improved spreadability vis-à-vis butter.           The introduction of reduced and
 low-fat butters, which incorporate additional milk protein and moisture to
 reduce the overall fat has also led to a reduction of the market share of
 full fat butter.
5.   Developments    of sales, financial     costs and number    of beneficiaries
 Ireland has operated the aid scheme as provided for in the above mentioned
 Regulation since 1978 and the scheme has especially during the last years
 accounted    for important     shares of the declining         internal Irish butter
 consumption.       In 1991 the purchase of around 6.182 tonnes of butter was
 aided under the scheme and the estimated purchases for 1992 are 7.246t.
 In 1990 the purchases           amounted    to 50% of the total           Irish    butter
 consumption but accounted for less than 5% of the production and it is
 also expected that the purchases in 1992 will account for more than 50% of
 the consumption       and less than 5% of the production.             The maximum aid
 reimbursed by EAGGF amounts at present to 149.74 ECU/100kg and the total
 financial     costs    for EAGGF     in 1991 amounted       to   9.3S    mio ECU. The
 expenditure for 1992 is estimate at 10,87 mio ECU.
 ---pagebreak---    The development in purchases, financial EAGGF costs and number of
   beneficiaries since 1978 is indicated below :
                Purchases          Financial   Costs       Beneficiaries
                (in tonnes)        (MECU)
    1978            66                   0.05              n.a.
    1979        3.704                    2.96              n.a.
    1980        3.958                    3.17              419.000
    1981        3.825                    3.06              431.000
    1982        4.080                   3.26               543.000
    1983        4.892                    3.91              569.000
    1984        4.122                   3.30               617.000
    1985        5.785                   4.63               650.000
    1986        5.189                   4.15               642.000
    1987        5.651                  10.06               720.000
    1988        6.178                  11.00               720.000
    1989        6.567                   9.85               720.000
    1990        6.182                   8.40               720.000
    1991*       6.260                   9.39               740.000
    1992*
   Jan-June*    3.623
   year*        7.246                  10.87               740.000
    * = Provisional
5. Conclusions   and recommendations
 The application of Council Regulation 2990/82 in Ireland has continued to
 be a successful      means in maintaining      sales to the social assistance
 categories   indicated under point 2 who in the normal course of events
 would for economic      reasons be in the forefront         of change to cheaper
 substitutes.
 With a continued       decline  in the normal       consumption   of butter,    the
 importance   of the scheme will be even greater in future for the milk
 sector in general and the butter sector in particular.               The Community
 financial   costs are considered      limited    notably   compared     with costs
 relating to alternative purchase into public intervention, which, in 1990
 and 1991, has been the outlet for a very important part of the Irish
 butter production.
 A withdrawal of this long standing benefit from the less well off sectors
 of society e.g. unemployed persons, old age pensioners, etc. could hardly
 be defended from a social, market or economic point of view, as well as
 the favourable public perception of a Community scheme promoting butter
 sales should not be neglected.
The Commission     therefore proposes a continuation         of the scheme for an
additional two years ending 31 December 1994. However, in view of the
reductions in intervention prices for butter already agreed by the Council
 for the next two milk marketing years and the expected resulting declines
in market prices for butter in Ireland, the aid levels are proposed
reduced by almost 10 ECU/100kg to 140 ECU/100kg as from 1.1.1993.
 ---pagebreak---                          COUNCIL REGULATION (EEC) No
                                        Of
   amending Regulation (EEC) No 2990/82 on the sale of butter at reduced prices
                      to persons receiving social assistance
THE COUNCIL OF THE EUROPEAN COMMUNITIES,
Having regard to the Treaty establishing the European Economic Community,
Having regard to council Regulation (EEC) No 804/68 of 27 June 1968 on the common
organization *&£ the market in milk and milk products^*), as last amended by
Regulation (EEC) Ho 2071/92(2) and in particular Article 12(2) thereof,
Having regard to the proposal from the Commission,
Whereas Council Regulation (EEC) No 2990/82^), as last amended by Regulation
(EEC) No 3917/90(4), introduces arrangements, expiring on 31 December 1992, for
the sale of butter at reduced prices to persons receiving social assistance;
whereas, as provided for in Article 3a(3) of that Regulation, the Council is to
examine before that date and on the basis of a report from the Commission the
possibility of renewing the arrangements laid down; whereas, as a result of the
report submitted by the Commission and the results obtained, the abovementioned
arrangements should be extended for a period of two years; whereas, in view on
the one hand of experience gained and on the other hand of the situation on the
market for butter, the aid should be reduced,
HAS ADOPTED THIS REGULATION:
(1) OJ NoL 148, 28.6.1968, p. 13.
(2) OJ No L 215, 30.7.1992, p. 64.
(3) OJ No L 314, 10.11.1982, p. 26.
(4) OJ No L 375, 31.12.1990, p. 12.
 ---pagebreak---                                      Article 1
Regulation (EEC) No 2990/82 is hereby amended as follows:
 1.  In Article 1, "31 December 1992" is replaced by "31 December 1994";
2.  In Article 3, "149,74 ECU" is replaced by "140 ECV";
3.  In Article 3a(3), "31 December 1992" is replaced by "31 December iff4".
                                     Article 2
This Regulation shall enter into force on thm 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
 ---pagebreak---          Financial                      Statement
                                                                           Date :
 1. BUDGET HEADING : B-1 2049                                 APPROPRIATIONS :    ECU 17 million (PDB 1993)
 2. TITLE :
    Proposal for a Council Regulation amending (Regulation (EEC) No 2990/82 on the sale of butter
    at reduced prices to persons receiving social assistance
 3. LEGAL BASIS : Article 12(2) of Regulation (EEC) No 804/68
 4. AIMS
    Continuation of the scheme involving the sale of butter at reduced prices to persons receiving
    social assistance at a lower rate of aid
 5. FINANCIAL IMPLICATIONS           PERIOD OF 12 MONTHS    CURRENT FINANCIAL YEAR     FOLLOWING FINANCIAL YEAR
                                                                    (1992)                     ii°.?32
 5.0 EXPENDITURE
       - CHARGED TO THE EC BUDGET
          (REFUNDS/INTERVENT IONS)    + ECU 16.2 mil lion                                   • ECU 10.1 mi 11 ion
       - NATIONAL AUTHORITIES
       - OTHER
5.1 REVENUE
       - OWN RESOURCES OF THE EC
          (LEVIES/CUSTOMS DUTIES)
       - NATIONAL
                                         1994                1995              1996                 1997
5.0.1 ESTIMATED EXPENDITURE         + ECU 16.2 mi 11    + ECU 6.1 mill
5.1.1 ESTIMATED REVENUE
5.2 METHOD OF CALCULATION
     12 months:   10 000 t x 1 400 ECU/t x 1.157 (DR)             + ECU 16.2 million (B)
     1993         10 000 t x 1 400 ECU/t x 7.5/12 x 1.157 (DR) = • ECU 10.1 million (B)
6.0 CAN THE PROJECT BE FINANCED FROM APPROPRIATIONS ENTERED IN THE RELEVANT CHAPTER OF THE CURRENT BUDGET ?
                                                                                                         YES
6.1 CAN THE PROJECT BE FINANCED BY TRANSFER BETWEEN CHAPTERS OF THE CURRENT BUDGET ?
6.2 WILL A SUPPLEMENTARY BUDGET BE NECESSARY ?
6.3 WILL FUTURE BUDGET APPROPRIATIONS BE NECESSARY ?
                                                                                                         YES
COMMENTS :
The PDB for 1993 has already been drawn up on the assumption that the scheme will be extended beyond
31.12.1992 for 10 000 tonnes with a reduced rate of aid to take account of the cut in the butter
intervention price for 1993/94.
 ---pagebreak---  ---pagebreak---                                                                            ISSN 0254-•4"
                                                                    COM(92) 478 final
                                                            DOCUMENTS
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