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The new Solidarity Fund

European Commission - MEMO/05/111   06/04/2005

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MEMO/05/ 111

Brussels, 6 April 2005

The new Solidarity Fund

The new proposal is based on the current Solidarity Fund. Its main features compared with the current EUSF are the following:

  • Thematic scope: major crisis situations resulting from natural disasters (as before) plus (new) industrial/technological disasters, public health emergencies and acts of terrorism
  • Geographical scope: Member States and countries negotiating accession (no change)
  • Definition of “major” disaster: new double approach

1. as today, total direct damage in excess of an absolute or a relative threshold, which ever is the lower. It is proposed to lower these from € 3 bn/0.6% of GNI to € 1 billion or 0.5% of GNI. The revision of the threshold, which substantially widens the eligibility of disasters, makes the continuation of the exception for regional disasters void, as all disasters requiring an act of European solidarity would now fall within the normal scope. This element should be a safeguard for the EUSF to remain an instrument for major disasters, whereas regional or local disasters can be addressed directly by the states concerned, in conformity with the subsidiarity principle.

2. introduction of a new criterion based on political considerations: any major disaster situation declared as such by the Commission. This mechanism should be used only for truly unexpected and exceptional situations, where physical damage alone is not an appropriate criterion, for example where physical damage is (still) limited such as terrorist attacks or major public health threats.

Exceptional mobilisation/regional disasters:

With the lowering of the normal mobilisation threshold as proposed, the need for exceptional mobilisation of the Fund no longer exists as all disasters requiring European solidarity would be covered by the normal criteria. For truly unexpected and exceptional situations the political criterion would still offer a possibility to mobilise the Fund.

Immediate solidarity: the proposal foresees (new) the possibility to make a rapid down payment in the event of a crisis. This down payment would be treated as an advance on the assistance to be granted once the assessment and budgetary procedure are completed. In the event that the application is not accepted the advance would have to be repaid to the Commission.

Mobilisation following request of an eligible state: Commission assessment, proposal to the budget authority, adoption of a corresponding budget, grant decision, implementation agreement. No substantial change but introduction of safeguards/deadlines to allow speedier payment of the grant.

Eligible operations: limited to public emergency operations as before but extended to include assistance to victims of terrorism, medical assistance in case of health crises and measures to protect the natural heritage.

Technical assistance: in order to pay for expertise to help assess applications a certain amount of money would be required, the lack of which poses problems today.

• The legal drafting of the new proposal has been reviewed and also contains a number of clearer provisions on financial control, etc.

Proposal for a new Solidarity Fund –Synopsis of main features



Current Solidarity Fund
New proposal
Entry into force
November 2002
January 2007
Geographical scope
Member States and candidate countries after formal opening of accession negotiations
no change
Application deadline
10 weeks after first damage
no change
Applicant
national government only
no change
Thematic scope
“mainly” major natural disasters
(health treats and terrorism excluded)
major disasters resulting from
- natural disasters
- industrial and technological disasters
- public health emergencies
- acts of terrorism
Eligibility criteria
  1. total direct damage above threshold
  2. neighbouring country
  3. exceptional mobilisation for extraordinary regional disasters
  1. total direct damage above threshold
  2. neighbouring country
  3. political criterion
(no regional disasters)
Threshold
(to be met per applicant state)
In relation to above:
  1. total direct damage above € 3 bn or 0.6% of GNI, whichever is the lower
  2. no threshold if major disaster in neighbouring country recognised
  3. major part of population affected, lasting repercussions on living conditions and economic stability of affected region
In relation to above:
  1. total direct damage above € 1 bn or 0.5% of GNI, whichever is the lower
  2. no threshold if major disaster in neighbouring country recognised
  3. political decision of the Commission: for cases where damage is inappropriate criterion (health threats, terrorism)
Eligible operations
Emergency operations
- to restore to working order basic infrastructures
- to secure protective infrastructure
- pay for emergency services and provisional housing,
- for protection of cultural heritage
- cleaning up
No compensation of private damage
As now, plus
- medical, psychological and social assistance to the direct victims of acts of terrorism and their families
- protection of the population against imminent health threats, including the replacement of vaccine, drugs, medical products and medical equipment used up during an emergency
Implementation period
1 year following payment of grant
18 months from first damage
Budgetary procedure
Full budgetary procedure involving EP and Council following a Commission proposal for an amending budget in each case
no change
Advance payments
not possible
upon request of applicant state: 5% of the estimated cost of eligible operations, maximum € 5 million
to be made available rapidly through internal budget transfer
Payment of grant
100% up front upon conclusion of the implementation agreement with beneficiary state, no co-financing obligation
no change
Implementation
Under full responsibility of beneficiary state
Minimum requirements on monitoring and reporting
Final report 6 months after end of grant
no change
Technical assistance
not available
up to € 2 million/year for external expertise
Annual amount
€ 1 billion (not “budgetised”)
no change

EU Solidarity Fund Applications since 2002

(last update 04/04/05)
Year
Country
Nature of the disaster
Damage
(million €)
category
Aid granted
(million €)
Receipt of EUSF aid on national level[1]
2
0
0
2
1
AT
Flooding
2 900
major
134
27/12/02
2
CZ
Flooding
2 300
major
129
13/1/03
3
FR
Flooding (Le Gard)
835
regional
21
27/12/02
4
DE
Flooding
9 100
major
444
29/12/02
Total aid 2002


728

2
0
0
3
1
ES
Oil spill (Prestige)
436
regional
8.626
29/03/2004
2
IT
Earthquake (Molise/Apulia)
1 558
regional
30.826
11/03/2004
3
IT
Volcanic eruption (Etna)
894
regional
16.798
11/03/2004
4
IT
Flooding (North Italy)
1 900
(major)
Rejection
n/a
5
GR
Adverse winter weather
not clear
(major)
Rejection
n/a
6
PT
Forest fires
1 228
major
48.539
02/12/2003
7
FR
Forest fires (Southern France)
531
(regional)
Rejection
n/a
8
ES
Forest fires (Portuguese border)
53
bordering country
1.331
06/09/2004 (payment date)
9
MT
Flooding
30
major
0.961
12/11/2004 (payment date)
10
IT
Flooding (Friuli Venezia-Giulia)
525
regional
Rejection
n/a
Total aid 2003


107.081

2
0
0
4
1
FR
Flooding
785
regional
19.625
07/07/2004
2
ES
Flooding (Malaga)
73
(regional)
Rejection
n/a
3-9
ES
Forest fires (7 applications)
(480)
(regional)
Rejection
n/a
10
SK
Flooding
29
(regional)
Rejection
n/a
11
SI
Earthquake
13
(regional)
withdrawn
n/a
Total aid 2004


19.625
















Year
Country
Nature of the disaster
Damage
(million €)
category
Aid granted
(million €)
Receipt of EUSF aid on national level
2
0
0
5
1
SK
Storm (Tatras)
224.65
major
pending

2
IT
Flooding (Sardinia)

(regional)
pending

3
EE
Storm

(major)
pending

4
LV
Storm

(major)
pending

5
SE
Storm

(major)
pending

6
LI
Storm

(neighbouring country)
pending








Total aid 2005


-

Grand total of aid granted since 2002


€ 854.706 million

Statistical overview

Total n° of applications received since 2002
of which major disasters
regional disasters
neighbouring country
31
10
19
2

32 % of applications
61 %
6 %
Applications accepted
Applications rejected
Applications withdrawn
Decision pending
11
13
1
6
35 % of applications
42 %
19 %


[1] The EUSF aid has to be used within one year from the date of arrival of the grant at the first account in the beneficiary country. No later than six months after the expiry of the one-year period the beneficiary country has to present an Implementation report with the Statement of validity.


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