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Brussels, 29 May 2009

The European Union Solidarity Fund (EUSF)

When will France receive the aid?

The European Union Solidarity Fund (EUSF) is financed from outside the normal Community budget. Before aid can be paid out, the budgetary authority (European Parliament and Council) must therefore adopt the proposal for an amending budget submitted to it by the Commission. This means that the budgetary resources will probably not become available before October. It will, however, be possible to use the aid retroactively ( see: IP/09/850 ).

What is the next step?

In order to grant aid from the Solidarity Fund to France, the Commission will ask the European Parliament and the Council, which together constitute the Union's budgetary authority, to adopt what is known as an amending budget. The Commission and France will then sign an agreement setting out the conditions for using the aid.

Situation in France

This storm hit the forestry sector particularly hard (over 60% of the damage), along with businesses and private homes (over 25% of the damage). It also had repercussions on infrastructure (transport, electricity, water and telecommunications) and on the agricultural sector, requiring clean-up operations. A total of 12 people died in this disaster and 400 were injured. Finally, it is expected that this disaster will have far-reaching effects on the paper and timber industries, which are of particular economic importance in the affected areas.

The Solidarity Fund can provide assistance only once a certain threshold has been reached, which, in the case of France, has been set at EUR 3.4 billion worth of damage. Given that damage caused directly by winter storm Klaus has been estimated at EUR 3.8 billion, this means that European aid can be released.

Why did the Commission take more than four months to react?

The Commission cannot react on its own initiative but must wait to receive an official request from the country concerned. France’s request for financial assistance from the EUSF was submitted to the Commission on 2 April, within the stipulated period of 10 weeks following the disaster. During this period the Commission was in close contact with the French authorities to help them to prepare their request.

The Commission quickly examined the request in the light of the Council Regulation establishing the Solidarity Fund. It concluded that the storm met the criteria to be considered a major natural disaster for which the Solidarity Fund could be mobilised.

France’s request referred to more extensive damage. Why was this not fully taken into account?

Other damage referred to in France’s request for assistance, such as loss of income and production due to interruption of economic activities and hypothetical damage such as the estimated value attached to the loss of the “carbon pump” effect of the destroyed woodland, was not taken into account for the calculation of the aid because it is not considered to be direct damage.

How is the amount of the aid calculated?

The following method is used to calculate aid for all EUSF interventions: a sum of aid representing 2.5% of the total amount of direct damage below the threshold for Fund assistance is granted, as is an amount corresponding to 6% of the portion of the damage above this threshold.

Who will be responsible for implementing the aid?

The Commission and France will sign an agreement for the implementation of the aid, and France will then be responsible for selecting and overseeing the projects. It will have one year from the date of payment of the aid to spend the funds. Six months later it will submit a report on the use of the aid to the Commission.

What can be financed by the Fund?

Payments from the Fund are limited to the financing of emergency operations carried out by the public authorities to deal with non-insurable damage (such as salvage operations, repair of infrastructures, temporary accommodation, cleaning, etc.).

No compensation can be paid for damage suffered by private individuals and loss of revenue, including in agriculture. Support must be obtained through the appropriate sustainable development programmes – specifically the Rural Development Programme for 2007 - 2013 financed by the European Agricultural Fund for Rural Development (EAFRD).

Will the Commission approve the aid scheme notified by France following winter storm Klaus?

The European Commission is currently examining an aid scheme notified by France following winter storm Klaus. A decision will be taken very shortly .

The Solidarity Fund - Background

The European Union Solidarity Fund (EUSF) was created after the floods which affected central Europe during summer 2002. It grants financial assistance for emergency measures in Member States and accession countries affected by major natural disasters.

In principle, assistance from the Fund is limited to the financing of emergency operations carried out by the public authorities to deal with non-insurable damage: repair of infrastructures or provision of temporary accommodation, for example. Damage suffered by private individuals or losses of income cannot be compensated.

On 6 April 2005, the Commission tabled a proposal for a revised Regulation laying down simpler and clearer criteria for quicker activation of the EUSF (in particular, this would enable advances to be paid). The proposal was warmly welcomed by the European Parliament but has yet to make any headway within the Council, i.e. at Member State level.

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