IP/07/1474
Brussels, 10 October 2007
Commission gives Romania one month to
improve farm aid systems; welcomes progress made in
Bulgaria
The European Commission today wrote
to Romania to inform it that it faces a provisional 25 percent cut
in European Union farm payments unless it can reverse certain
serious shortcomings in its administration and financial control
system before payments to farmers take place (payment year begins 1
December 2007). The Commission will not be withholding farm payments
to Bulgaria because its system has been set up and is operational.
Commission Regulation 1423/2006, building on Art. 37 of the
Accession Treaties for Romania and Bulgaria, provides for the
reduction of payments by 25 percent if the systems set up to ensure
the correct payment of farm aid are so seriously deficient that they
affect the proper functioning of the overall system. Romania can
prevent this happening by delivering on two points of the utmost
importance: putting in place and properly testing two software
modules which are indispensable elements in the Integrated
Administration and Control System (IACS); avoiding payments to
farmers before the required controls are completed. Additional
on-the-spot checks are required to compensate for the insufficient
quality of the Land Parcel Identification System. Mariann Fischer
Boel, Commissioner for Agriculture and Rural Development, has
written to the Romanian Agriculture Minister, Mr Decebal Traian
Remes, and a reply is expected by 9 November.
"Romania has made progress in setting up its administration and
control systems, but has not yet done everything required to ensure
that the system works properly," Commissioner Fischer Boel said. "It
still has time to rectify the situation, but it is a matter of
urgency and swift actions are needed. That is why I urge the
Romanian authorities to leave no stone unturned in their efforts to
put the necessary systems into place before payments begin. We have
a duty to ensure that the farm budget is properly spent and that
irregularities don't occur."
Commenting on Bulgaria, the Commissioner said: "Bulgaria has made
good progress and has set up its integrated administration and
control system. Weaknesses remain but not of a significant nature.
Furthermore, Bulgaria has assured us that remaining weaknesses will
be rectified before the first payments are made. In any case, both
countries will of course also be subject to the regular audit
procedure which is applied in all EU Member States".
How the payments system works
From 1 December every year, Member States can pay farmers their
direct aid from the national budget of their country via a Paying
Agency. This money is then reimbursed to the national budget from
the Community budget. In view of the shortcomings of the Integrated
Administration and Control System and the Paying Agency at the time
of accession and in order to avoid financial irregularities and
distortions in the functioning of the internal market, the
Regulation 14723/2006 allows for 25 percent of the Community aid to
be withheld if serious shortcomings are found in the systems. This
does not mean that farmers would lose out, but that the national
budget would have to provide 25 percent of the money supposed to
come from the Community until such time as the shortcomings were
overcome. Both countries will of course also be subject to the
regular audit procedure which is applied in all EU Member States.
This could result in Clearance of Accounts decisions to ask Member
States to pay back money to the Commission.
How much EU money is supposed to go to Romania and Bulgaria by
budget year
Direct payments
Mio€, current prices
|
2007 |
2008 |
2009 |
2010 |
2011 |
2012 |
2013 |
TOTAL |
BG |
|
202
|
249
|
290
|
330
|
411
|
492
|
1974
|
RO |
|
443
|
533
|
624
|
713
|
891
|
1069
|
4273
|
Rural development
Mio€, current prices
|
2007 |
2008 |
2009 |
2010 |
2011 |
2012 |
2013 |
TOTAL |
BG |
244.1 |
337.1 |
437.3 |
399.1 |
398.1 |
397.7 |
395.7 |
2 609.1 |
RO |
741.7 |
1 023.1 |
1 319.3 |
1 236.2 |
1 234.2 |
1 235.5 |
1 232.5 |
8 022.6 |
Problems found in Romania
Commission audits carried out in June and September confirmed
that serious problems remain in Romania. These concern the computer
software for the entry of the results of on-the-spot checks, and for
the calculation of the sums to be paid. Deficiencies persist on the
Land Parcel Identification System, and with administrative and
on-the-spot controls. A warning letter will be sent to the Romanian
authorities, who will have to reply by 9 November.
Remedial action needed
Commissioner Fischer Boel intends to propose withholding 25
percent of the aid to Romania:
Unless the Romanian reply confirms that the two computer software
modules have been put in place and tested properly, and that this is
confirmed by an independent expert body;
If large-scale payments are made to farmers before the completion
of the administrative and on-the-spot controls, in which case the
system would not be capable of preventing widespread
irregularities.
If Romania does not succeed in making the improvements by 9
November, the Commission would take the decision to reduce payments
as early as possible (November 2007). If Romania does succeed, a
further audit mission would be sent in early 2008 to monitor
progress.
Situation in Bulgaria
Audits in June and September showed that the IACS has been set up
and is operational. Some deficiencies were noted in the working of
the Land Parcel Identification System, and will be remedied before
payments are made. There is a need to increase on-the-spot checks.
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