CELEX: 51981PC0707
Language: en
Date: 1981-11-19
Title: PROPOSAL FOR A COUNCIL REGULATION (EEC) instituting a specific action on behalf of housing of Northern Ireland within the framework of an integrated operation in Belfast (presented by the Commission to the Council)

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COM (81) 707
Vol. 1981/0205
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 ---pagebreak---    COMMISSION OF THE EUROPEAN COMMUNITIES
                                                 COM(81 ) 707 final
                                                 Brussels , 19th November 1981
                       PROPOSAL FOR A COUNCIL REGULATION ( EEC )
                instituting a specific action on behalf of housing of
                Northern Ireland within the framework of an integrated
                operation in Belfast
                     (presented by the Commission to the Council )
                                      v : <' r
                               yC V \  -  ...
                         >■
                         f   ■
                            v.
COM ( 81 ) 707 final
 ---pagebreak---                            STATEMENT OF GROUNDS
 Northern Ireland has always been considered , both within the framework of
 national regional policy and at the level of Community structural policies ,
  as a peripheral region experiencing exceptionally serious structural problems .
  For this reason Northern Ireland benefits in the context of all Community poli­
  cies and financial instruments from the priority treatment , from the higher rates
  of Community aids and from several specific actions intended to , improve , in conjunc­
  tion with measures undertaken by the United Kingdom , the impact of measures designed
 to deal with the above mentioned problems in their various fields .
 Total Community grants ( commitment ) for structural purposes on behalf of Nor­
 thern Ireland from 1973 to 1980 inclusive are some £ 214 million . It may be
 estimated that this was 1.2 % of regional GDP in 1980 ( EEC average 1980 :
 some 0.15 % of GDP ). The importance of the Community effort can also be
  illustrated by the two following tables :
                                     I       ■
                                    Grants in ECU / head ( 1 )
 Commitments        1973     ' 1974      1975       1976       1977 .   1978 1979      1980
1
Northern
                     7.5        8.2      17.7       24.7       22.5     32.5 57.3      54.0
  Ireland
  EEC                1.6 -      2.1     . 3.3        4.2        4.7   •  5.7  9.7      11.6
                                                                                  * -I
  ( 1 ) Takes no account of specific actions decided in 1960 and 1981
 ---pagebreak---                                        ~ 2 "
                                Loans in ECU/ head
                    1973     1974       1975    1976   ; 1977       1978    1979    1980
  Northern
' Ireland              -
                              3.2          -
                                                         18.0           -
                                                                            50.2    53.0
  EEC                3.7·     4.9        7.8       8.4    9.0        10.9   12.8    15.7
  The initiative taken by the Commission in proposing ta the United Kingdom Govern­
  ment an integrated operation in Belfast should be viewed within this general frame­
  work . With this integrated operation in mind, this Government has sent details to the
                                                                 i
  Commission of groups of linked investments which are important for develop ! ng^fhe ur-
                                                                   (
  ban area of Belfast . This is the main urban industrial conurbation of the region ,
  containing about one third of the total population . Also involved is the main
  port of the region . However , the area suffers from the consequences of concen­
  tration of industrial sectors in decline and of an especially marked urban
  decline ."
  Despite national and Community measures , the social and economic situation of
  the region has worsened continuously . The European Parliament , in its resolution
  of 19 June 1981 ( 1 ) adopted on the basis of detailed reports on social and econo­
  mic problems in Northern Ireland, has stressed this worsening situation and has asked
  for further remedial measures . The reports have stressed in particular poverty and low
                                                 »                        .           .  .
  incomes , housing conditions and health of the population , unemployment and under
  employment and the conditions governing energy supply in this peripheral region .
  The Parliament has recommended the Commission to study more particularly certain
  points among which are the "housing stock renewal and renovation of accommodation
  in certain areas ( particularly Belfast ) as a matter of urgency , since job creation
  must be linked with improved living conditions ".
  ( 1 ) O.J. n° C 172 of 13.7.1981 / p. 122
 ---pagebreak--- The Commission considers that the field in which immediate Community action
could produce tangible results of an improved situation of the conditions
                            1 i l I.
above mentioned is hojsing , especially in Belfast .
The housing problem in Northern Ireland and particularly in Belfast is of
considerable size and is a real bottleneck for the social and economic
development of the region . Moreover , public expenditure on housing is a
priority within overall public expenditure for structural purposes in Nor­
thern Ireland . The aim of the public authorities is to improve housing con­
ditions - currently 14 % of dwellings are inadequate - and to reduce the number of
families requiring housing urgently and waiting t (? be rehoused . Many years of
continued effort will be needed to meet requirements . The minimum number of new
houses required is calculated at some 5,000 dwellings a year . To date , the United
Kingdom Government has been unable to provide the means for a programme
of this size . In 1980 , only 3,020 new dwellings were started for the whole
region .
This situation causes all the more concern because there i ^ virtually no market
for smal I dwellings so that private initiative cannot f i 1 1 \ the gap due to
lack of resources available to the public authorities . domi|unity aid could
therefore contribute to attaining the required level , provided the
aid supplied is effectively converted into an increased number of new
dwellings annually .                        ' . ,v
The importance of housing requirements also emerges from the document ,
presented for the Belfast integrated operation . Nearly half the investments
envisaged are for housing . These investments are not however capable of
realisation within the considered time schedule indicated in the document
(3 years ) without Community aid .
 ---pagebreak---                                        - 4 -
                                                        c  -
                    «
 Community aid would therefore have tangible results in hastening housing
 construction in Northern Ireland with beneficial consequences on jobs and on
 many sectors of activity linked to building construction . The aid is necessary
 to carry out the integrated operation in Belfast and would greatly facilitate
 the realisation of other measures for structural purposes in the region .
 However , housing finance is not usually eligible for contributions from
 Community financial instruments , whether grants or loans . Community aid
 can only be granted for housing exceptionally and under limited conditions
 ( with the exception of ECSC loans on behalf of ECSC social housing ) and in
most cases only for social housing linked to productive investment .
Nevertheless , the budget authority has written a special article ( Article
 541 ) into the budget urid within that article line 5411 , which is intended
 for credits to enable financing of special measures within the framework of
 integrated operations , jointly with national or local authorities ,- in cases
where the measures involved do not fall within the existing framework of
 Community financial instruments .
                 *
The integrated operations undertaken hitherto are^still at the experimental
 stage . The budget line in question is only " p.m ." awaiting a formal proposal
by the Commission to the Council in order to establish the necessary legal     /
 basis for the use of credits to be allocated . to this budget line .
 However , in view of the exceptionally serious social and economic situation
                                             ι
fio Northern Ireland and to give the integrated operation env-isaged full impact ,
 the Commission has proposed to the Council in the letter amending . the initial
draft general budget of the European Communities for 1982 ( 1 ) to allocate
28 million ECU to line 5411 to finance
 ( 1 ) C0M(81 ) 557 final
 ---pagebreak---                                        - 5 -
   a specific action for housing m Northern Ireland within the framework of
   a Belfast integrated operation . At the same time , the Commission stated that
                                       »        ■ >                    .     \
   the Council would receive a formal proposal as soon as possible . The proposed
    regulation attached herewith complies with this commitment .
   The Commission intends at a later date to make a proposal to the Council which
    will be a legal basis valid for all specific actions to be carried out within ;
/ the framework of integrated operations where these measures are needed and
    where they are not covered by ( existing financial instruments .
   If' the specific action is to be effective and significant ,      should be pluriannual
   and last for at least as long as that foreseen for an - integrated operation, namely
   three years . If the level of Community aid is at least , 28 million ECU for the first
   year and kept at this level for three years in real terms ( implying thereby , as an
   indication, some 93 million ECU of Community expenditure ) and if employed solely
   to finance new housing , the aid would cover rather more than one third of the
 . number of new housing contemplated in the integrated operation . Potential
   building rate    will depend however as well on housing location ; whether in
   Belfast or over the whole regional territory ^ But action must be progressive :
   Starting in 1982 and returning thereafter annually to the budget authority to
   continue the action on the basis of experience gained over the year in progress .
 ---pagebreak---   The addit ional ity of increased Community effort in relation to national
  expenditure must be measured in relation to effective United Kingdom expen­
  diture on new housing in 1981 . The figure of national expenditure should not
  decline in real value over later years of the programme , or at least the
  relative size should be maintained within total national expenditure, in Northern
  Ireland and the special programme should show the number of additional new
  housing to be built annually thanks to Community aid with an estimated time
  schedule for building and costs .
  Additionally would therefore indicate , at the least , the maintenance of the United
s Kingdom effort . However , a co-financing rate of 50 % ( see financial details )
  would be needed to obtain this result . Moreover , to hasten implementation ,
  a system of advance payments of 80 % should be introduced for each annual
y instalment of forecast expenditure in the special programme *       •
  The proposal for a regulation naturally provides for annual reports     by the United
  Kingdom on progress made in carrying out the building programme and for
  reports to be presented by the Commission in applying the regulation , and
                                                                                   *
  the provision    for inspection and on-the - spot checks .
                   -   1   . ,                 •                  ( '
  The regulation is based on Article 235 of the EEC. Treaty so that prior
  consultation of the Parliament is required . The Commission suggests to the
  Council that an opinion should also be sought from the Economic and Social
 ---pagebreak---                               .                                                            !
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                                                                                           i
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                                                                              '            1
                                                                                    ■ -     i
                                                                                            ?
                 Proposal for a Council Regulation ( EEC ) n° ........781 of
                             1981 instituting a specific action on behalf of
                 housing in Northern Ireland within the framework of an -
                 integrated operation at Belfast
      THE COUNCIL FO THE EUROPEAN COMMUNITIES
       Having regard to the Treaty establishing the European Economic Community
       and in particular Article . 235 thereof ,
                       7
       Having regard 'to the proposal of the Commission ;
       Having regard to the opinion of the European Parliament ,
  ■    Having regard to the opinion of the Economic and Social Committee,
i      Whereas Northern Ireland is one of the peripheral regions <jjf the Community
    . experiencing parti cular ly serious structural problems and has therefore
                                                                       ?
       priority status in both the national and Community context* and benefits from
      several types of specific action in various fields ,               -
       Whereas , despite the efforts of the Community and the United Kingdom - the
                                s  -                         •
       social and economic situation in this region has continued to deteriorate ; whereas
       the European Parliament , in its resolution of 19 June 1981 ( 15 , under­
       lined this deterioration by highlighting , in the reports on which this
      resolution is based, the poverty and low incomes , the conditions of housing
      and health of the population, particularly in Belfast , the level of unemploy-
                                       »
      •nent arid under-employmervt and energy supply conditions in this region ;
       ( 1 ) O.J. n° C 172 of 13*7.1931 , p , 122
 ---pagebreak---                                   - 2 -
Whereas the Commission suggested to the United Kingdom Government that it under­
takes an integrated operation in Belfast ; whereas this Government , in view of this
 integrated operation, has presented the Commission a document giving details
of groups of investments which are important for the development of the
Belfast urban area ;
Whereas the implementation of an integrated operation in Belfast should be able ,
with all the specific actions undertaken in Northern Ireland , to contribute to
the efforts needed progressively to remedy this situation within the region
provided that all the investments can be carried out at an adequate rate ;
Whereas however almost half the expenditure on these projects concern hou­
sing ; whereas the volume of annual national expenditure on housing in
Northern Ireland does not enable investment at a rate which corresponds to
the size of requirements , neither in the region , nor in Belfast ; whereas ,
on the other hand, such investments are only exceptionally Eligible under
existing Community financial instruments ;
Whereas it is in consequence essential to institute a specific action on
behalf of housing in Northern Ireland within the framework      the Belfast'
integrated operation on the basis of a pluri-annual programme to be presented
by the United Kingdom Government , enabling the assessment of the additional
character of the Community aid in relation   to   national expenditure ;
Whereas this action is necessary for the aims of the Treaty to be achieved
and whereas the Treaty has not made provision for the necessary means of
action required to achieve these aims ;
HAS ADOPTED THIS REGULATION :. /
 ---pagebreak---                                      Article 1
  A specific action on behalf of new housing        in Northern Ireland is
  instituted within the framework of an integrated operation at Belfast .
  The specific action shall be implemented accprding to a pluri-annual .              . ,
  programme to be presented by the United Kingdom.'
                                      Article 2
  The specific action shall consist of co-financing by the Community in the construc­
  tion of new housing .     The amount of the financial contribution by the Community      ^
  shall be decided according to annual instalments of new housing           to be started
  each year under the programme .                                  j
  Within the limit of budget resources allocated annually to $his action within
  the framework of budget procedure , the maximum amount of this contribution
  shall be 50 % of forecast construction costs including infrastructure linked
  closely thereto .                                                                      '
                                    Article 3        -
  The information contained in the programme and in        ;         ; ' •>
  its annual revision shall      enable the Commission to ensure that Community aid
* is additional to national expenditure allocated to the programme . The         ■,
  grant of this aid is conditional       on the assessment by the Commission
  of this additional character .                        -    ' ' '
  The programme shall indicate, iri particular, the volume of investment in new
  housing to be started during the year and the part- which is the
  subject of an application for coTf inancing by the Community
  and the proportion of additional new housing for which building is made
  possible by Community ,'a id . At the same time , the programme shall give estimates'
  for the two following years . These estimates shall be revised annually ih
 ---pagebreak---   October for the following year . The programme shall also contain an estimated
  time schedule for payments and for work on new housing .
  The outline of data to be included in . the programme is laid down in the
  Annex to this regulation .
                                       Article 4
                               .       _____
  The Commission , acting on the basis of information contained in the programme
- shall decide at the beginning of 1982 the amount of the contribution and the
  conditions applicable thereto by instalment or part of instalment of new
  housing    to be started that year . Decisions shall be taken for following
  years after updating of the programme in October of the previous year .
                                                              \
                                     Article 5
  At the request of the United Kingdom , advances may be paid up to 80 /. of .
                                                                I
  the amount of the contribution granted for each annual instalment or part
  of instalment . The balance of the contribution     shall be paid on completterfr
  of the buildings planned and on receipt of a statement from the United
  Kingdom Government .'certifying that all payments for the new housing 1
  have been made . Payment of advances and the outstanding balance
 shall be credited to the agency responsible for implementing the pro­
  gramme . The United Kingdom shall however repay to the Commission amounts
  which it has not been possible to use in accordance with this regulation or .
  the conditions governing grant of the contribution .
                                    Article 6
  In October of., each year , beginning October 1983 , at the same time as the
  updating of the programme for the following years , the United
  Kingdom shall send the Commission a progress report on the works . This
  report shall be sent to the Council and the European Parliament with a
  related report from the Commission on the manner i n which this regulation
  has been applied .
 ---pagebreak---                               Article 7
The United Kingdom shall provide the Commission with al I necessary details
on proper - implementation of the specific action and
shall take all measures required to facilitate inspection and check ,
which the Commission may consider useful , more particularly with the autho­
rities and agencies responsible for implementing the programme , including
on-the -spot checks .
           • v*               Article 8
         •  * '        • •            •  ' '     *      • -
In agreement with the Commission , the United Kingdom shell take all measures
needed to provide information on and to give publicity fof the specific
action .        N
                              Article 9
The specific action shall last for three years from 1 January 1982 . It may
be prolonged by the Council on a proposal from the Commission .              '
                              Article 10
This regulation shall enter into force on the 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 .                 -  .                            'v
                                                      For the Council
                                                      The President
 ---pagebreak---                                                                                     ANNEX
             OUTLINE OF DETAILS TO BE PROVIDED IN THE PROGRAMME " NORTHERN IRELAND
             HOUSING" ( All details are to be supplied for Northern Ireland as a
             whole and for the urban area of Belfast ).
 I.    Introduction
       1 . General description of the housing situation :
            - condition of existing housing ,
            - new housing requirements ,
            - requirements for the restoration of existing housing .
       2 . Relevant policy during the last three years both with regard to
            quantity and finance .
II . .'Achievements during financial year 1981 / 82
       3 . Extent of budget appropriations for housing to be shown in relation to
            total public expenditure in Northern Ireland , subdivided into areas
            of major cost . This amount should also be shown in percentages for the
            last three financial years .
       4 . -Subdivision to be shown of expenditure on housing for 1981 / 82 according
            to nature of expenditure i incurred ; e.g. acquisition of land, new
            housing construction , modernisation and improvement , maintenance
            and management costs , loan charges , etc .
            Quantitative data on achievements ( e.g. number of new dwellings built
            or under construction ) to be added if possibles If the budget year has
            not yet closed , estimates should be added to available data and should
            have regard to costs and work in progress .
 ---pagebreak---                                        - 2 -
III . Programme for the financial year 1982 / 83
       5 . Estimates of financial means available , with planned expenses subdivided
           as for section II ( 4 ) above .                                     -
   .   6 . Funds requested from the Community and allocated to new housing
           construction to be started during the financial year .
       7 . Estimated number of new housing to be started during the financial year .
                              y
       8 . New housing for which application has been made for Community
           assistance and the number of additional new housing for which
           construction will be possible due to Community aid .
       9 . Estimated time schedule for new housing indicated at points 7 and
           8 with estimated time schedule for works completion .
 IV . Forecasts or estimates for the two following financial years .
       1 . To be indicated as far as possible according to the same subdivisions
           as in section III .               "
       The programmes are to be revised in October 1982 for the financial year­
     - 1983 / 84 arid in the same manner in following years . Progress reports on
       completion or state of programme implementation should follow the same
       outlme plan .
 ---pagebreak---                                 FINANCIAL STATEMENT
1 . BUDGET HEADING
     Line 5411 " Community measures within the framework of integrated operations "
2 . TITLE OF MEASURE
     Specific measure in favour of housing in Northern Ireland within the framework
     of an integrated operation in Belfast .            .
3 . LEGAL BASIS
    Regulation ( EEC ) n°           of the1 Council of      .. establishing a specific
    measure in favour of housing in Northern Ireland within the framework of an
     integrated operation in Belfast .
4 . AIMS OF THE MEASURE
4.1\. General aim of the measure :
       The financing , together with national or local authorities , of a measure out­
       side the normal field of application of the Community 's existing financial *
        instruments , which has as its aim the establishment of an integrated operation in
    * Belfast which will have the necessary impact t6 contribute       in as signi­
        ficant a way as possible to the progressive solution of the socio-economic
       problems of Northern Ireland .
4.2 . Specific aim :
       Participation in the construction of new dwellings to the benefit of the
       whole population .
 ---pagebreak---   5 . JUSTIFICATION OF THE MEASURE
* 5.1 . The housing sector is recognized as being one of the most deficient in
         Northern Ireland and notably in Belfast ; see the European Parliament 's
         resolution of 19th June 1981 "on Community Regional Policy and Northern-
         Ireland" and Paragraph 10 I ) of this resolution which states :
         '...housing stock renewal and renovation of accommodation in certain areas
         ( particularly Belfast ) as a matter of urgency, since job creation must be^
         linked with improved living conditions.'
  5.2 . Action at the Community level is justified owing to the worsening of the -
         relative situation of Northern Ireland in the Community . This measure should ,
         enable the rhythm of dwellings construction tobe accelerated , something that
         would not happen without Community aid .
  6 . FINANCIAL IMPLICATIONS for the measure concerning intervention appropriations
  6.1 . Total cost for the Community from 1982 to 1984 J approximately 93 million ECU
         allowing for average monetary depreciation of 10          a year in the European
       ' Community .
  6.2 . Financing the costs of construction up to a maximum rat ^ of 50 % .
         ( see Article 2 of the proposal for a regulation )
  6.3 . 5 year balanc# sheet of the necessary credits :
                                                                                    Mio ECU
         Commitments                                   Payments                          ■
                   *  Î'
                                1982     1983        1984    ■V 1985     Further financial
                                                                                  years
         1982        28         22.4  ,       .-· ·■
                                                      5.6          -              -
         1983        31            -
                                         24.8           - ·
                                                                 6.2           .  -
         1984        34            -      ■ ■ -      27.2          -
                                                                                 6.8
         Total       93         22.4     24.8        32.8        6.2             6.8
 ---pagebreak---                                               3
  6.4 . Method of calculation :
                   • »* '
                                                          S
     a ) On the basis of an average cost of £ 20 000 per dwelling the total
         28 million ECU corresponds to approximately 750 new dwellings ,, half the
         number of new dwellings begun in Belfast in 1?80 „ The rate of Community
         aid depends on the actual possibilities for new construction each year and
         variations in cost . It should be fixed so as to abtain the maximum addi­
         tional effect , taking into account the volume of national expenditure . A
         rate that can rise to a maximum of 50 %. for a part of the programme offers
         the margin needed to obtain this result .
     b ) Total cost of Community intervention over 3 years at today 's prices :
         84 million ECU, 28 million ECU per year .
     c ) Total cost of Community intervention taking into account on average
         + 10 % monetary depreciation per year .
                             1982  :   28 million ECU
                             1983  :«  31 million ECU
                             1984  :   34 million ECU                                ,
                             Total :   93 million ECU
     d) Article 5 of the proposal, for a regulation provides for the payment of advances
         of 80 % of the aid committed for each annual instalment . The balance of
         20 % is to be paid after completion of building , that is to say two years
         later .
                                                        /
 7 . FINANCING OF THE EXPENDITURE
       Credits be included in the future budgets starting from the 1982 financial
       year .
                          /
. 8 . PLANNED METHOD OF CONTROL
  8.1 . In addition to the normal internal and external control , an annual report
          is planned concerning the progress of works , to be transmitted by the
          Commission to the Council and Parliament ( Article 6 of the proposal of
          regulation) .
 ---pagebreak---                                            - 4 -
8*2 . The previsions concerning, the pluri-annual housing programme ,, which will
       serve as the basis of this measure ( first Article of the proposal of' regu­
       lation ) are to be revised each year for the following year ( ibidem
       Article 3> 2nd sub-paragraph ) „     -
       The granting of aid is subject to the addit ipnsl ity of Community aid being
     . verified , on the basis of the indications contained in the above mentionec
       programme ( ibidem Article 4 , first subparagraph )