Commission proposals for 1.30% Financial Discipline in 2015 budget
27 Mar 2014 11:44 AM
The
European Commission has adopted a proposal on the application of the financial
discipline mechanism for the CAP budget for the financial year 2015. In order
to ensure that the market crisis reserve of €433 million is available in
the 2015 budget, the proposal is to reduce CAP Direct Payments exceeding
€2000 by 1.301951%, with the exception of direct payments for farmers in
Bulgaria, Romania and Croatia as they are still being phased-in in those Member
States. This compares with a rate of 2.453658% that was applied for
2014.
According to the budget rules, the Commission is obliged
to table a proposed rate of financial discipline before the end of March, if
forecast spending for the following year (including the crisis reserve) is
higher than the maximum budget available amount for CAP Direct Payments &
market measures (the so-called "1st Pillar" of the CAP, funded
through the European Agricultural Guarantee Fund) defined in the 2014-2020
Multi-Annual Financial Framework. Under the rules, the Council and European
Parliament have now until 30 June 2014 to fix the rate of financial discipline.
In the absence of such agreement by 30 June, the Commission will set the
rate.
In
October, the Commission will present an amending letter to the draft 2015
budget, which will update forecast budget needs, and will therefore also update
the rate of financial discipline no later than 1 December. According to CAP
legislation, amounts generated by financial discipline which remain available
in the EAGF budget at the end of the financial year, including those of the
crisis reserve, shall be reimbursed to farmers.