REPORT on the proposal for a decision of the European Parliament and of the Council on mobilisation of the European Union Solidarity Fund, in accordance with point 11 of the Interinstitutional Agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management (disasters in Bulgaria and Greece in 2015)

17.9.2015 - (COM(2015)0370 – C8‑0198/2015 – 2015/2151(BUD))

Committee on Budgets
Rapporteur: Andrey Novakov

MOTION FOR A EUROPEAN PARLIAMENT RESOLUTION

on the proposal for a decision of the European Parliament and of the Council on mobilisation of the European Union Solidarity Fund, in accordance with point 11 of the Interinstitutional Agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management (disasters in Bulgaria and Greece in 2015)

(COM(2015)0370 – C8‑0198/2015 – 2015/2151(BUD))

The European Parliament,

–       having regard to the Commission proposal to the European Parliament and the Council (COM(2015)0370 – C8‑0198/2015),

–       having regard to Council Regulation (EC) No 2012/2002 of 11 November 2002 establishing the European Union Solidarity Fund[1],

–       having regard to Council Regulation (EU, Euratom) No 1311/2013 of 2 December 2013 laying down the multiannual financial framework for the years 2014-2020[2], and in particular Article 10 thereof,

–       having regard to the Interinstitutional Agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management[3], and in particular point 11 thereof,

–       having regard to the letter from the Committee on Regional Development,

–       having regard to the report of the Committee on Budgets (A8-0253/2015),

1.      Approves the decision annexed to this resolution;

2.      Instructs its President to sign the decision with the President of the Council and arrange for its publication in the Official Journal of the European Union;

3.      Instructs its President to forward this resolution, including its annex, to the Council and the Commission.

ANNEX: DECISION OF THE EUROPEAN PARLIAMENT AND OF THE COUNCIL

on the mobilisation of the EU Solidarity Fund

THE EUROPEAN PARLIAMENT AND THE COUNCIL OF THE EUROPEAN UNION,

Having regard to the Treaty on the functioning of the European Union,

Having regard to Council Regulation (EC) No 2012/2002 of 11 November 2002 establishing the European Union Solidarity Fund[4] and in particular Article 4 (3) thereof,

Having regard to the Interinstitutional Agreement of 2 December 2013 between the European Parliament, the Council and the Commission on budgetary discipline, on cooperation in budgetary matters and on sound financial management[5], and in particular point 11 thereof,

Having regard to the proposal from the European Commission,

Whereas:

(1)         The European Union Solidarity Fund (the "Fund") aims to enable the Union to respond in a rapid, efficient and flexible manner to emergency situations and to show solidarity with the population of regions struck by disasters.

(2)         The Fund is not to exceed a maximum annual amount of EUR 500 million (2011 prices), as laid down in Article 10 of Council Regulation (EU, Euratom) No 1311/2013[6].

(3)         Bulgaria has submitted an application to mobilise the Fund, concerning severe winter conditions.

(4)         Greece has submitted two applications to mobilise the Fund, concerning floods.

(5)         The Commission has assessed that the applications meet the conditions for awarding aid from the Fund, as laid down in Regulation (EC) No 2012/2002.

(6)         The Fund should therefore be mobilised in order to provide a financial contribution for the full amount of EUR 16 274 765 in respect of the applications submitted by Bulgaria and Greece.

(7)         There is scope for reallocating appropriations in accordance with the second sentence of point 11 of the Interinstitutional Agreement of 2 December 2013. The appropriations for advances for the financial year 2015 have been used, to a very limited extent, for the three applications which are the subject of this Decision and for which the remaining balance to be paid is EUR 14 647 288. Consequently, the full amount for the mobilisation will be financed through the reallocation of the available appropriations for advances in the general budget of the European Union for the financial year 2015, and no additional appropriations are needed.

(8)         In order to minimise the time taken to mobilise the Fund, this decision should apply from the date of its adoption,

HAVE ADOPTED THIS DECISION:

Article 1

For the general budget of the European Union for the financial year 2015, the European Union Solidarity Fund shall be mobilised to provide the sum of EUR 16 274 765 in commitment and payment appropriations.

The full amount of this mobilisation shall be financed using the appropriations mobilised by Decision (EU) 2015/422 of the European Parliament and of the Council[7] for the payment of

advances in the Union budget for the financial year 2015, available on

budget line 13 06 01. The amount available on that budget line for advances shall be reduced accordingly.

Article 2

This Decision shall enter into force on the day of its publication in the Official Journal of the

European Union. It shall apply from …[the date of its adoption] [Date to be inserted by the Parliament before the publication in OJ].

Done at Brussels,

For the European Parliament                      For the Council

The President                                                The President

EXPLANATORY STATEMENT

The Commission proposes to mobilise the European Union Solidarity Fund (EUSF) to grant financial assistance relating to a disaster in Bulgaria (severe winter conditions causing a disaster classified under the EUSF as a “major natural disaster”) and two disasters in Greece (flooding in Evros and Central Greece, classified under the EUSF as “regional disasters”) that occurred in early 2015, on the basis of point 11 of the Interinstitutional Agreement of 2 December 2013.

The Commission has carried out a thorough examination of all three applications in accordance with Council Regulation (EC) No 2012/2002 establishing the European Union Solidarity Fund as amended by Regulation (EU) No 661/2014 of the European Parliament and of the Council of 15 May 2014, in particular with Articles 2, 3 and 4 thereof.

Bulgaria − Severe winter conditions

Major parts of Bulgaria were affected by heavy rainfall, snow, floods and landslides at the end of January and during early February 2015, with the South-East region hardest hit. These events caused considerable damage to public infrastructure, such as dykes, communication networks and roads, as well as businesses, private homes and assets (over 300 buildings in the city of Burgas alone were flooded), and harm to the agricultural sector and forests.

The Bulgarian authorities have estimated total direct damage caused by the disaster at EUR 243,305 million. As this represents 0,622 % of Bulgaria’s GNI or 103,6 % of the “major disaster” threshold of EUR 234,871 million applicable to Bulgaria in 2015 (i.e. 0,6 % of GNI based on 2013 data for mobilising the EUSF), the disaster qualifies as a “major natural disaster” within the meaning of Article 2(2) of the Regulation.

The application from Bulgaria was received on 24 April 2015, within the deadline of 12 weeks after the first damage was recorded on 30 January 2015.

The financial contribution may only be used for essential emergency and recovery operations as defined in Article 3 of the Regulation. The cost of eligible essential emergency operations has been estimated by the Bulgarian authorities at EUR 239,225 million. This disproportionately high amount (over 98 % of the reported total damage) is explained by the high share of public damage, with the inability of local authorities to assess the private damage properly within the 12 weeks application deadline. Private damage is therefore to a large extent not included in the application. The larger share of the costs comprises urgent recovery operations – over EUR 97 million including safety and preventive infrastructure. Over EUR 46 million are requested for recovery of transport infrastructure.

The affected regions fall under the category of "less developed regions" under the European Structural and Investment Funds (2014-2020). The Bulgarian authorities have not signalled to the Commission their intention to reallocate funding from the ESI Fund programme for Bulgaria towards recovery measures.

Upon Bulgaria's request, the Commission paid an advance of EUR 637 782, i.e. 10% of the anticipated Fund contribution, in line with Article 4a(2) of the Regulation. The amount was already used by the Bulgarian government for urgent recovery of transport infrastructure, drainage, safety and preventive infrastructure.

Greece − Floodings in the Evros and in the central and western regions

Wide-spread floodings in Eastern Macedonia and Thrace in early February 2015 caused damage to essential infrastructure, public buildings, private homes, businesses and in Greek agriculture, destroying farming infrastructure, warehouses and crops. Water supplies and sewage infrastructure were damaged in 17 settlements. In parallel, major parts of central and western Greece were hit by another series of floods causing even greater damage, resulting in power failures, the isolation of a number of mountainous settlements and the destruction of some of Greece’s cultural heritage assets.

As the events have the same meteorological origins, the two applications were merged and treated as a single regional disaster under Article 2(3) of the Regulation. In all, five NUTS 2 regions were affected by the disaster: the East Macedonia and Thrace region (Evros flooding) as well as the Epirus, West Greece, Central Greece and Thessaly regions (central and western Greece flooding).

Both applications were submitted on 23 April 2015, within the required deadline of 12 weeks after the first damage was recorded (1 February for the central and western regions and 4 February 2015 for Evros).

The cumulated direct damage caused by the events is estimated at EUR 395,878 million (EUR 132,454 million for Evros and EUR 263,424 million for central and western Greece). Based on these figures, the event does not meet the "major disaster" threshold applicable to Greece in 2015 (EUR 1 091,315 million or 0,6 % of GNI based on 2013 data). However, total direct damage represents 4,78 % of the weighted average GDP of the five concerned NUTS 2 regions and thus exceeds by far the 1,5 % threshold for the weighted regional GDP to qualify as a regional disaster.

The cost of eligible essential emergency operations has been estimated by the Greek authorities at EUR 308,445 million, the largest share concerning the transport sector. The affected regions are "less developed regions" under the European Structural and Investment Funds (2014-2020). The Greek authorities have not signalled to the Commission their intention to reallocate funding from the ESI Fund programme towards recovery measures.

At the request of Greece, an advance payment of 10 % of the anticipated financial contribution from the EUSF was paid, amounting to EUR 331 135 for Evros and EUR 658 560 for central and western Greece.

In line with past practice, the Commission proposes to apply in both cases the rate of 2,5 % of total direct damage for all damage up to the threshold, and 6 % for damage above the threshold (only in the case of Bulgaria).

The following aid amounts are proposed by the Commission:

Disaster	Direct damage(million €)	Applied regional disaster threshold (million €)	Major disaster threshold(million €)	Total cost of eligible operations(million €)	2,5 % of direct damage up to threshold €	6 % of direct damage above threshold €		Total amount of aid proposed €
BULGARIA	243,305	-	234,871	239,225	5 871 775	506 040	6 377 815
GREECE	395,878	124,354	1 091,315	308,445	9 896 950	-	9 896 950
TOTAL							16 274 765

After the deduction of the already paid advances of 10 % (EUR 637 782 for Bulgaria and EUR 989 695 for Greece), the remaining balance to be paid is EUR 14 647 288 (of which EUR 5 740 033 for Bulgaria and EUR 8 907 255 for Greece).

At the time of the adoption of the Budget 2015, an amount of EUR 50 000 000 in commitment and payment appropriations was entered into the budget for the payment of advances. Invoking Point 11 of the IIA which provides for the possibility to reallocate appropriations, the Commission proposes to mobilise the Fund by drawing on this already mobilised amount, earmarked specifically for payment of advances, to pay the remaining balance of EUR 14 647 288.

Given this, the proposed mobilisation would not require an amendment to the 2015 budget. Therefore, the Commission does not have the intention to present a draft amending budget.

This operation would leave an amount of EUR 33 725 235 available for payment of any further advances in 2015 if need be, which the Commission assesses as sufficient to cover any possible new applications received during the remaining months of 2015.

This is the second mobilisation decision of 2015 and the total amount of aid proposed above complies with the ceiling provisions for the EU Solidarity Fund as set in the MFF Regulation of EUR 541,2 million (i.e. EUR 500 million in 2011 prices).

According to point 11 of the IIA of 2 December 2013, in case of a disagreement between Parliament and Council on these proposals, the Commission will initiate a trilogue procedure in view of securing the agreement of the two arms of the Budgetary Authority on the need to use the Fund and on the amount required.

According to an internal agreement with the Committee on Regional Development (REGI), this committee should be associated to the process, in order to provide constructive support to the implementation of the EU Solidarity Fund. Following the assessment of the requests, the REGI committee of the European Parliament gave its views on the mobilisation of the Fund, as expressed in the letter of opinion attached to the present report.

The Rapporteur recommends the approval of the Commission proposal for a decision annexed to this report for the following reasons:

•   the two cases match the European Solidarity Fund’s criteria;

•   the nature of the disasters, their vast extent and profound impact on the local communities and economies;

•   the damage has affected the regions thoroughly - not only public infrastructure (water supplies, sewage and electricity infrastructure)but also private property, businesses, agricultural land and forests;

ANNEX – LETTER FROM THE COMMITTEE ON REGIONAL DEVELOPMENT

Mr Jean ARTHUIS

Chairman

Committee on Budgets

European Parliament

Dear Mr. Arthuis,

Subject:           Mobilisation of the European Union Solidarity Fund in favour of Bulgaria and Greece

The European Commission has transmitted to the European Parliament its proposal for a decision of the European Parliament and of the Council on the mobilisation of the EU Solidarity Fund (COM(2015)0370), on the basis of applications to mobilise the Fund submitted by Bulgaria and Greece in relation to three disasters in their territories in 2015.

The Commission proposes the mobilisation of the European Union Solidarity Fund, estimating the damage caused by each disaster and per country as follows:

Disaster	Direct damage(million €)	Applied regional disaster threshold (million €)	Major disaster threshold(million €)	Total cost of eligible operations(million €)	2,5 % of direct damage up to threshold €	6 % of direct damage above threshold €		Total amount of aid proposed €
BULGARIA	243,305	-	234,871	239,225	5 871 775	506 040	6 377 815
GREECE	395,878	124,354	1 091,315	308,445	9 896 950	-	9 896 950
TOTAL							16 274 765

In the light of the examination of the applications and considering the maximum possible grant from the Fund, the Commission proposes to mobilise the Fund for these two cases by using EUR 16 274 765 from the EUR 50 000 000 specifically mobilised for advances on the general budget of the European Union for the financial year 2015.

The Committee coordinators have assessed this proposal, and asked me to write to you reporting that the majority of this Committee has no objection to this mobilisation of the EU Solidarity Fund to allocate the above-mentioned amount as proposed by the Commission.

Yours sincerely,

Iskra MIHAYLOVA

RESULT OF FINAL VOTE IN COMMITTEE

Date adopted	14.9.2015
Result of final vote	+: –: 0:	24 1 0
Members present for the final vote	Nedzhmi Ali, Reimer Böge, Lefteris Christoforou, Jean-Paul Denanot, Gérard Deprez, José Manuel Fernandes, Eider Gardiazabal Rubial, Jens Geier, Ingeborg Gräßle, Monika Hohlmeier, Carlos Iturgaiz, Bernd Kölmel, Zbigniew Kuźmiuk, Ernest Maragall, Clare Moody, Siegfried Mureşan, Liadh Ní Riada, Jan Olbrycht, Younous Omarjee, Urmas Paet, Indrek Tarand, Daniele Viotti, Marco Zanni
Substitutes present for the final vote	Andrey Novakov
Substitutes under Rule 200(2) present for the final vote	Raymond Finch

• [1]  OJ L 311, 14.11.2002, p. 3.
• [2]  OJ L 347, 20.12.2013, p. 884.
• [3]  OJ C 373, 20.12.2013, p. 1.
• [4]  Council Regulation (EC) No 2012/2002 of 11 November 2002 establishing the European Union Solidarity Fund, (OJ L 311, 14.11.2002, p. 3).
• [5]  OJ C 373, 20.12.2013, p. 1.
• [6]  Council Regulation (EU, Euratom) No 1311/2013 of 2 December 2013 laying down the multiannual financial framework for
  the years 2014-2020 (OJ L 347, 20.12.2013, p. 884).
• [7]  Decision (EU) 2015/422 of the European Parliament and of the Council of 17 December 2014 on the mobilisation of the European Union Solidarity Fund (OJ L 68, 13.3.2015, p. 47).