Procedure : 2013/0087(COD)
Document stages in plenary
Document selected : A7-0186/2013

Texts tabled :

A7-0186/2013

Debates :

PV 11/06/2013 - 21
CRE 11/06/2013 - 21

Votes :

PV 12/06/2013 - 8.14

Texts adopted :

P7_TA(2013)0263

REPORT     ***I
PDF 214kWORD 195k
3 June 2013
PE 508.289v02-00 A7-0186/2013

on the proposal for a regulation of the European Parliament and of the Council on fixing an adjustment rate to direct payments provided for in Regulation (EC) No 73/2009 in respect of calendar year 2013

(COM(2013)0159 – C7-0079/2013 – 2013/0087(COD))

Committee on Agriculture and Rural Development

Rapporteur: Luis Manuel Capoulas Santos

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION
 EXPLANATORY STATEMENT
 OPINION of the Committee on Budgets
 PROCEDURE

DRAFT EUROPEAN PARLIAMENT LEGISLATIVE RESOLUTION

on the proposal for a regulation of the European Parliament and of the Council on fixing an adjustment rate to direct payments provided for in Regulation (EC) No 73/2009 in respect of calendar year 2013

(COM(2013)0159 – C7-0079/2013 – 2013/0087(COD))

(Ordinary legislative procedure: first reading)

The European Parliament,

–   having regard to the Commission proposal to Parliament and the Council (COM(2013)0159),

–   having regard to Article 294(2) and Article 43(2) of the Treaty on the Functioning of the European Union, pursuant to which the Commission submitted the proposal to Parliament (C7-0079/2013),

–   having regard to Article 294(3) of the Treaty on the Functioning of the European Union,

–   having regard to the opinion of the European Economic and Social Committee of 23 May 2013(1),

–   having regard to Rule 55 of its Rules of Procedure,

–   having regard to the report of the Committee on Agriculture and Rural Development and the opinion of the Committee on Budgets (A7-0186/2013),

1.  Adopts its position at first reading hereinafter set out;

2.  Calls on the Commission to refer the matter to Parliament again if it intends to amend its proposal substantially or replace it with another text;

3.  Instructs its President to forward its position to the Council, the Commission and the national parliaments.

Amendment              1

Proposal for a regulation

Recital 2

Text proposed by the Commission

Amendment

(2) The forecasts for the direct payments and market related expenditure determined in the preparation of the 2014 Draft Budget show that the annual ceiling for the European Agricultural Guarantee Fund (EAGF) in respect of financial year 2014 is likely to be exceeded taking into account the need to establish the reserve for crises referred to in the Conclusions of the European Council (7/ 8 February 2013) on the Multiannual Financial Framework. An adjustment rate to the direct payments listed in Annex I to Regulation (EC) No 73/2009 should therefore be determined.

(2) Pending the adoption of a regulation laying down the multiannual financial framework on the basis of Article 312(2) of the Treaty on the Functioning of the European Union, the level of the applicable ceiling for the year 2014 remains uncertain. Until there is clarity on the level of the applicable ceiling, it is not possible to determine whether an adjustment of the direct payments for 2013 is necessary and, if so, what the rate should be. The amount of financial discipline required should be revised by the budgetary authority in the framework of the adoption of the Budget 2014 on the basis inter alia of the Amending letter to the Draft General Budget 2014 whereby the Commission provides updated estimated needs on market related expenditures and direct payments.

Amendment  2

Proposal for a regulation

Article 1 – Paragraph 1

Text proposed by the Commission

Amendment

1. The amounts of direct payments within the meaning of Article 2(d) of Regulation (EC) No 73/2009 to be granted to a farmer in excess of EUR 5000 for an aid application submitted in respect of calendar year 2013 shall be reduced by 4.981759%.

1. The amounts of direct payments within the meaning of Article 2(d) of Regulation (EC) No 73/2009 to be granted to a farmer in excess of EUR 5000 for an aid application submitted in respect of calendar year 2013 shall be reduced by 0,748005 %.

Justification

The European Parliament should not accept a cut in direct payments which is based on the Conclusions of the 7-8 February European Council, including its proposal of placing the crises reserve under Heading 2. At present, the cut to direct payments should be based on the ceiling for 2014 proposed by the Commission in its own MFF proposal (in COM (2012)388), which is consistent with the European Parliament's negotiating mandate, approved in plenary on 13 March 2013, on the direct payments regulation.

Amendment  3

Proposal for a regulation

Article 1 – paragraph 1 a (new)

Text proposed by the Commission

Amendment

 

1a. In the event of a non-agreement on the multiannual financial framework 2014-2020, no financial discipline for the 2014 financial year shall apply, since the total amount shall be calculated on the basis of the 2013 budget figures plus 2 % inflation.

Amendment  4

Proposal for a regulation

Article 1 a (new)

Text proposed by the Commission

Amendment

 

Article 1a

 

1. The provisions of Articles 1 and 2 are adopted without prejudice to the subsequent adoption of Regulation (EU) No [XX/XX of ... laying down the multiannual financial framework for the years 2014-2020] and the Inter-institutional agreement between the European Parliament, the Council and the Commission on cooperation in budgetary matters and sound financial management.

 

2. In the event that a correction to the adjustment rate defined in Article 1(1) is required as a consequence of the adoption of the Regulation and Inter-institutional agreement referred to in paragraph 1, the European Commission shall submit a proposal to the European Parliament and to the Council concerning the fixing of a new adjustment rate.

 

3. The amount of financial discipline required shall be revised by the budgetary authority in the framework of the adoption of the Budget 2014 on the basis inter alia of the Amending letter to the Draft General Budget 2014, whereby the Commission provides updated estimated needs on market related expenditures and direct payments.

(1)

Not yet published in the Official Journal.


EXPLANATORY STATEMENT

Background - The Commission Proposal

On 25 March 2013, the Commission published a proposal for a regulation 'on fixing an adjustment rate to direct payments provided for in Regulation N° 73/2009', which we call hereafter the 'financial discipline' proposal.

The legal basis for the proposal is Article 11 of Regulation 73/2009 on Direct Payments (as last amended by Regulation 671/2012). Article 11 states that when the Commission forecasts that for a given year the sub-ceiling for market related expenditure and direct payments under Heading 2 of the Multiannual Financial Framework (MFF) will be exceeded, it shall propose a cut in direct payments before 31 March. The cut is calculated to bring the forecasted spending back under the ceiling.

With that objective in mind, the Commission's proposal, in Article 1, lays down that all direct payments superior to 5 000 EUR for which claims are submitted in 2013 shall be cut by 4.981759%. The cut would not be applied in Bulgaria, Romania and Croatia, given that these three countries are still in the process of phasing in their direct payments.

The Rapporteur's Observations

The problem with the Commission proposal is that the cut of around 5% to direct payments it envisages is based on the sub-ceiling suggested by the 7/8 February 2013 European Council. It also integrates the European Council's wish to include a crises reserve of 2 800 million EUR (in 2011 prices) for 2014-20 period under Heading 2, to be financed by financial discipline.

However the procedure for drawing up the next MFF (under Article 312 of the Treaty on the Functioning of the European Union) is still ongoing; the European Parliament (EP) is yet to grant its consent. Indeed, at the time of writing, the negotiations on the final financial ceilings have not really yet begun. Furthermore, the EP has not endorsed the idea of placing the crises reserve under Heading 2, and financing it by way of financial discipline.

For institutional and political reasons, the rapporteur therefore believes that it would not be appropriate to accept the Commission proposal on financial discipline with no modifications. Doing so would be tantamount, de facto, to accepting the sub-ceiling for market expenditure and direct payments proposed by the February 2013 European Council. Such decisions are for the European Parliament's negotiating team on the 2014-20 MFF to consider, at a later stage.

In this context, one should bear in mind that the legislation in force, namely Article 18(5) of Regulation 1290/2005, allows the Commission adjust the level of financial discipline until 1 December of any given year on the basis of new information in its possession.

The Rapporteur's Position

Given the context, the rapporteur feels that it is appropriate, at this stage, to base the calculation on the financial discipline required for claims made in 2013 on the European's Parliament's negotiating mandate on the revised direct payments regulation (COM(2011)0625) approved in Strasbourg on 13 March 2013. In its amendment on Annex II, Parliament has proposed a distribution of direct payments based on it the ceilings proposed by the Commission in its original 2011 MFF proposal, as revised to account for Croatia's upcoming accession [(COM (2012)388].

The rapporteur therefore proposes an amendment where the cut to direct payments for claims made in 2013 would amount to 0.748005%, rather than the 4.981759% put forward by the Commission. This estimate was provided by the Commission itself, on request from the rapporteur. Naturally, it does not include the crises reserve, since the Commission in its 2011 proposal intended to create the crises reserve outside the MFF.

The rapporteur's position assumes that some level of financial discipline may have to be applied for claims made in 2013.

However, in the event of the EP and Council failing to reach an agreement on the 2014-2020 MFF in coming months, and the 2013 ceilings being applied to the 2014 budget (as laid down under Article 312(4) of the TFEU), it may still turn out to be the case that financial discipline is not necessary.


OPINION of the Committee on Budgets (22.5.2013)

for the Committee on Agriculture and Rural Development

on the proposal for a regulation of the European Parliament and of the Council on fixing an adjustment rate to direct payments provided for in Regulation (EC) No 73/2009 in respect of calendar year 2013

(COM(2013)0159 – C7-0079/2013 – 2013/0087(COD))

Rapporteur: Giovanni La Via

SHORT JUSTIFICATION

In drawing up the 2014 Draft Budget, the first budgetary estimates for direct payments and market related expenditure showed that that the sub-ceiling under heading 2 for financial year 2014, after financial transfers between EAGF and EAFRD, is likely to be exceeded. As a consequence, the level of direct payments should be reduced in order to comply with the ceiling.

On this basis, the Commission presents a proposal for setting the adjustment rate for direct payments in respect of calendar year 2013, which is to be adopted by the European Parliament and the Council by 30 June 2013 in accordance with Article 11(1) of Regulation (EC) No 73/2009 as amended by Regulation (EU) No 671/2012 of the European Parliament and of the Council2. However, if this adjustment rate has not been set by 30 June 2013, the Commission will set that rate pursuant to Article 18(4) of Council Regulation (EC) No 1290/2005 on the financing of the common agricultural policy.

The calculation of the financial discipline adjustment rate is part of the preparation of the 2014 Draft Budget in order to comply with the sub-ceiling for market related expenditure and direct payment under Heading 2 for financial year 2014, after financial transfers between EAGF and EAFRD, set out in the Conclusions of the European Council (7/8 February 2013) on the Multiannual Financial Framework5. According to the Conclusions, the reserve for crises is included under Heading 2 and will be established by applying at the beginning of each year a reduction to direct payments with the financial discipline mechanism.

The first estimates of budget appropriations for direct aids and market related expenditure showed the need to reduce the total amount of direct payments that can be granted to farmers in respect of calendar year 2013 by EUR 1471.4 million through financial discipline in order to respect the sub-ceiling for financial year 2014 set out in the Conclusions of the European Council (7/8 February 2013) on the Multiannual Financial Framework, reduced by the amounts made available to EAFRD pursuant to Article 10(b) and 136 of Regulation (EC) No 73/2009 and Article 52 of Commission proposal for a Regulation (EU) establishing rules for direct payments to farmers under support schemes within the framework of the common agricultural policy. The financial discipline reduction also includes EUR 424.5 million needed to establish the reserve for crises.

AMENDMENTS

The Committee on Budgets calls on the Committee on Agriculture and Rural Development, as the committee responsible, to incorporate the following amendments in its report:

Amendment  1

Proposal for a regulation

Recital 2

Text proposed by the Commission

Amendment

(2) The forecasts for the direct payments and market related expenditure determined in the preparation of the 2014 Draft Budget show that the annual ceiling for the European Agricultural Guarantee Fund (EAGF) in respect of financial year 2014 is likely to be exceeded taking into account the need to establish the reserve for crises referred to in the Conclusions of the European Council (7/ 8 February 2013) on the Multiannual Financial Framework. An adjustment rate to the direct payments listed in Annex I to Regulation (EC) No 73/2009 should therefore be determined.

(2) Pending the adoption of a regulation laying down the multiannual financial framework on the basis of Article 312(2) of the Treaty on the Functioning of the European Union, the level of the applicable ceiling for the year 2014 remains uncertain. Until there is clarity on the level of the applicable ceiling, it is not possible to determine whether an adjustment of the direct payments for 2013 is necessary and, if so, what the rate should be.The amount of financial discipline required shall be revised by the budget authority in the framework of the adoption of the Budget 2014 on the basis inter alia of the Amending letter to the Draft General Budget 2014 whereby the Commission provides updated estimated needs on market related expenditures and direct payments.

Amendment  2

Proposal for a regulation

Recital 4

Text proposed by the Commission

Amendment

(4) The mechanism of the financial discipline, together with the modulation, was introduced with the 2003 CAP reform. Both instruments provided for a linear reduction of the amount of direct payments to be granted to farmers. Taking into account the implications of the unequal distribution of direct payments between small and large beneficiaries, modulation has been applied to amounts in excess of EUR 5000 in order to achieve a more balanced distribution of payments. In respect of calendar year 2013, the adjustment of direct payments referred to in Article 10(a) of Regulation (EC) No 73/2009 continues to provide for the same exemption as the modulation. The financial discipline should be applied in a similar way to also contribute to achieving the objective of a more balanced distribution of payments; therefore, it is appropriate to provide for the application of the adjustment rate only for amounts in excess of EUR 5000.

(4) The mechanism of the financial discipline was introduced with the 2003 CAP reform. The instrument provided for a linear reduction of the amount of direct payments to be granted to farmers. The financial discipline should be applied in a way that will ensure equal treatment of all farmers, therefore it is appropriate to provide for the application of the adjustment rate to all amounts.

Amendment  3

Proposal for a regulation

Article 1 – paragraph 1

Text proposed by the Commission

Amendment

1. The amounts of direct payments within the meaning of Article 2(d) of Regulation (EC) No 73/2009 to be granted to a farmer in excess of EUR 5000 for an aid application submitted in respect of calendar year 2013 shall be reduced by 4.981759 %.

1. The amounts of direct payments within the meaning of Article 2(d) of Regulation (EC) No 73/2009 to be granted to a farmer for an aid application submitted in respect of calendar year 2013 shall be reduced by [xxx] % ("the adjustment rate").

Justification

In compliance with the decision on the opening of, and mandate for, interinstitutional negotiations on direct payments to farmers under support schemes within the framework of the CAP - 2011/0280(COD), which provides a linear reduction on all direct payments by applying the financial discipline, and with view on an equal treatment of all beneficiaries and all Member States the financial discipline shall apply to all direct payments in claim year 2013. Thereby the applicable adjustment rate will be reduced accordingly and shall be fixed once a final agreement on the MFF has been reached between the European Council and the European Parliament.

Amendment  4

Proposal for a regulation

Article 1 – paragraph 1 a (new)

Text proposed by the Commission

Amendment

 

1a. The provisions of Articles 1 and 2 are adopted without prejudice to the subsequent adoption of the Regulation laying down the multiannual financial framework for the years 2014-2020 and the Interinstitutional agreement between the European Parliament, the Council and the Commission on cooperation in budgetary matters and sound financial management.

 

In the event that a correction to the adjustment rate defined in paragraph 1 is required as a consequence of the adoption of the aforementioned Regulation and Inter-institutional agreement, the Commission shall present a proposal to the European Parliament and the Council to fix a new adjustment rate.

 

The amount of financial discipline required shall be revised by the budgetary authority in the framework of the adoption of the Budget 2014 on the basis inter alia of the Amending letter to the Draft General Budget 2014 whereby the Commission provides updated estimated needs  on market related expenditures and direct payments.

Amendment  5

Proposal for a regulation

Article 1 – paragraph 1 b (new)

Text proposed by the Commission

Amendment

 

1b. In the event of a non-agreement on the Multiannual Financial Framework 2014-2020, no financial discipline for the financial year 2014 shall apply, as the total amount shall be calculated on the basis of the 2013 ceiling plus 2% deflator.

PROCEDURE

Title

Adjustment rate to direct payments provided for in Regulation (EC) No 73/2009 in respect of calendar year 2013

References

COM(2013)0159 – C7-0079/2013 – 2013/0087(COD)

Committee responsible

       Date announced in plenary

AGRI

16.4.2013

 

 

 

Opinion by

       Date announced in plenary

BUDG

16.4.2013

Rapporteur

       Date appointed

Giovanni La Via

15.4.2013

Date adopted

16.5.2013

 

 

 

Result of final vote

+:

–:

0:

25

1

4

Members present for the final vote

Marta Andreasen, Zuzana Brzobohatá, Jean-Luc Dehaene, Göran Färm, José Manuel Fernandes, Eider Gardiazábal Rubial, Lucas Hartong, Jutta Haug, Monika Hohlmeier, Sidonia Elżbieta Jędrzejewska, Anne E. Jensen, Ivailo Kalfin, Jan Kozłowski, Alain Lamassoure, George Lyon, Jan Mulder, László Surján, Angelika Werthmann, Jacek Włosowicz

Substitute(s) present for the final vote

María Muñiz De Urquiza, Paul Rübig, Peter Šťastný, Nils Torvalds

Substitute(s) under Rule 187(2) present for the final vote

Inés Ayala Sender, Albert Deß, Carlos José Iturgaiz Angulo, Andrey Kovatchev, Elisabeth Köstinger, Ivari Padar, Petri Sarvamaa


PROCEDURE

Title

Adjustment rate to direct payments provided for in Regulation (EC) No 73/2009 in respect of calendar year 2013

References

COM(2013)0159 – C7-0079/2013 – 2013/0087(COD)

Date submitted to Parliament

25.3.2013

 

 

 

Committee responsible

       Date announced in plenary

AGRI

16.4.2013

 

 

 

Committee(s) asked for opinion(s)

       Date announced in plenary

BUDG

16.4.2013

 

 

 

Rapporteur(s)

       Date appointed

Luis Manuel Capoulas Santos

25.3.2013

 

 

 

Discussed in committee

24.4.2013

 

 

 

Date adopted

30.5.2013

 

 

 

Result of final vote

+:

–:

0:

26

10

0

Members present for the final vote

Eric Andrieu, José Bové, Luis Manuel Capoulas Santos, Vasilica Viorica Dăncilă, Michel Dantin, Paolo De Castro, Albert Deß, Diane Dodds, Herbert Dorfmann, Robert Dušek, Iratxe García Pérez, Béla Glattfelder, Martin Häusling, Peter Jahr, Elisabeth Jeggle, Elisabeth Köstinger, George Lyon, Mairead McGuinness, James Nicholson, Wojciech Michał Olejniczak, Marit Paulsen, Britta Reimers, Alfreds Rubiks, Giancarlo Scottà, Czesław Adam Siekierski, Sergio Paolo Francesco Silvestris, Alyn Smith, Ewald Stadler, Csaba Sándor Tabajdi, Marc Tarabella, Janusz Wojciechowski

Substitute(s) present for the final vote

Marian Harkin, Maria do Céu Patrão Neves, Elżbieta Katarzyna Łukacijewska

Substitute(s) under Rule 187(2) present for the final vote

Teresa Jiménez-Becerril Barrio, Edvard Kožušník, Jens Nilsson

Date tabled

3.6.2013

Last updated: 4 June 2013Legal notice