Brussels, 08/10/2001 (Agence Europe) - In its Special Report 8/2001 on the system of refunds for the production of potato and cereal starch and potato starch aid in 1998-2000, the Court of Auditors finds that Germany has not respected the measures on the minimum price to be paid to producers. In its response, the European Commission acknowledges that the levying of a delivery premium of 4% of the minimum price is "unacceptable" and says that it will look into the issue in more detail. The Court also revealed that an investigation by the European Anti-Fraud Office in the 1998/1999 marketing year had put the spotlight on 20,000 tonnes of potatoes being diverted from the Netherlands to Germany. The Commission acknowledges that the quota system needs improvement, noting that the total amount to be recovered in this affair (once sanctions have been applied as part of the accounts clearance procedure) amounts to EUR 6.2 million.
More generally, it should be pointed out that the Court is relatively satisfied with the administrative controls carried out in the Member States where audits were carried out (France, Germany and the Netherlands) which together receive around 70% of the budgetary expenditure concerned, but notes that the level of on-the-spot checks carried out in potato starch mills by national auditors varies and needs improvement in France and the Netherlands. The Commission argues that the weaknesses spotted here and there do not seem to be serious problems, and announced the publication by the end of the year of a study assessing the Community's starch and starch products policy to shed light on the effectiveness of the various measures (production and export aid, premiums for potato starch mills and production quotas) and the revenue of farmers receiving direct aid. The Commission will soon be presenting the Council with a report on the breakdown of the potato quota throughout the Community, together with proposals as appropriate.
The Court also stressed that information available to date does not make it possible to decide whether the system's objectives have been met, such as the competitiveness of the starch-using industries or aid to make up for the structural disadvantage faced by potato starch mills. The current scheme of refunds for the production of potato and cereal starch in the EU dates back to the 1992 reform of the Common Agricultural Policy and covers the payment of production refunds to cereal and potato starch-user industries and specific aid measures for starch potato producers and potato starch mills. In 2000, total expenditure relating to cereal starch and potato starch stood at EUR 900 million or 5.4% of total Community expenditure on arable crops.