Brussels, 27/03/2013 (Agence Europe) - For the very first time, the European Commission adopted, on Wednesday 27 March, a proposal of financial discipline providing for a reduction of nearly 5% in 2014 of direct payments paid to farmers. Farms receiving under €5,000 would be exempted from that reduction in direct payments.
The Commission is under an obligation to make such a proposal as spending forecasts regarding direct payments and market measures under the CAP in 2014 exceed the ceiling fixed by the heads of state and/or government (in the February agreement that is still being negotiated with the European Parliament on the multiannual financial framework 2014-2020). The fall of nearly 5% in agricultural aid corresponds to a reduction of €1.4 billion. No reduction will be applied to Bulgaria, Romania or Croatia (where direct aid is still being gradually introduced).
This autumn, the Commission will update its forecasts on spending under the first pillar (direct aid and market spending) for 2014. Where necessary, it will propose adjustment of the rate of financial discipline that should be adopted by the Council for 1 December at the very latest.
Application of financial discipline can be explained by the financial transfers to rural development and the funding of the new crisis reserve in the agricultural sector.
The Commission proposes €424.5 million for that reserve that the European Council has agreed to finance from Heading 2 (management of natural resources) of the financial framework. The Commission had initially envisaged funding for the reserve from outside the financial framework. The draft budget for 2014 is still under preparation within the Commission. It will be published in May. The Commission is due to present the proposal on the financial discipline instrument by end March. (LC/transl.jl)