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Poverty: new Fund for European Aid to the Most Deprived - frequently asked questions

European Commission - MEMO/14/131   25/02/2014

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European Commission

MEMO

Brussels/Strasbourg, 25 February 2014

Poverty: new Fund for European Aid to the Most Deprived - frequently asked questions

The European Commission proposed to set up a new Fund for European Aid to the Most Deprived (FEAD) on 24 October 2012 (see IP/12/1141). The European Parliament approved the proposal on 25 February 2014 (see STATEMENT/14/22). The proposal is due to be definitely adopted by the EU's Council of Ministers in the coming weeks.

What is the new Fund for European Aid to the Most Deprived?

The main purpose of the Fund for European Aid to the Most Deprived (FEAD), which will be worth €3.8 billion in the 2014 to 2020 period, is to support Member States' social emergency relief schemes. The FEAD will support Member States' actions to provide a broad range of non-financial material assistance including food, clothing and other essential goods for personal use such as shoes, soap and shampoo, to materially-deprived people, including the homeless, and their children.

Furthermore, the FEAD will require that the distribution of material assistance be combined with social inclusion measures such as guidance and support to help the most deprived to get out of poverty.

Why does the Fund focus on food, the homeless and materially-deprived children?

The Fund will help the most-deprived, the homeless and materially-deprived children to break out of the vicious circle of poverty and deprivation and so make a concrete contribution to the Europe 2020 target of reducing the number of people in poverty or at risk of poverty by at least 20 million.

One of the main features of material deprivation is the inability to access appropriate quantities and quality of food, something which is defined as a basic need by the World Health Organisation. Another particularly severe form of extreme poverty and exclusion is homelessness. There are an estimated 4.1 million homeless people in Europe today.

The new instrument will also explicitly target children because they are more exposed to poverty than the rest of the population and suffer from forms of material deprivation that make them less likely than their better-off peers to do well at school, enjoy good health and realise their full potential as adults. This has also been addressed in the Commission Recommendation of 20 February 2013 on 'Investing in children: breaking the cycle of disadvantage'.

The new Fund focusses on these forms of extreme material deprivation not only because they are potentially life-threatening, but also because insufficient food and a lack of basic goods such as clothes makes it impossible for the most affected people to escape from poverty and exclusion and even to take advantage of training or counselling measures.

How will the Fund work?

There will be considerable flexibility. Member States will be able to choose, according to their own situation and preferences, the type of assistance they wish to provide (food or basic goods or a combination of both), and their preferred model for procuring and distributing the food and goods.

The Commission will approve the national programmes for 2014-2020 and national authorities will take the individual decisions leading to the delivery of the assistance through partner organisations (often non-governmental). A similar approach is already used for cohesion funds.

National authorities can either purchase the food and/or goods themselves and then make them available to partner organisations, or provide the latter with the funding to make the purchases themselves. Partner organisations purchasing the food or goods themselves can either distribute the material assistance directly, or entrust the distribution to other partner organisations.

How will the partner organisations be selected?

The partner organisations will be public bodies or non-governmental organisations selected by Member States on the basis of objective and transparent criteria defined by the respective Member States.

How many people live in poverty in the EU?

In 2012, close to 125 million people - almost a quarter of the population in the EU - were at risk of poverty or social exclusion (see STAT/13/184). Almost 50 million are suffering severe material deprivation.

There are an estimated 4.1 million homeless people in the EU, including young people, migrants and families with children.

What are the resources available?

In real terms, over €3.8 billion will be allocated to this Fund over the 2014-2020 period.

In addition, the Member States will have to contribute a minimum of 15% national co-financing to their national programme.

This represents a significant increase of the resources available under the FEAD national programmes, compared to the amounts under the previous “Food Distribution programme for the Most Deprived Persons of the Community” (MDP).

Is the budget foreseen sufficient given that there are 50 million people suffering from severe deprivation in the EU?

The Fund does not aim to reach all 50 million people who are suffering from severe deprivation in Europe, but targets the most vulnerable among them, such as the homeless and children living in poverty. It is up to Member States to focus their programmes on the most needy.

In total, the number of people to be helped directly by the Fund, by Member States co-funding and contributions in kind by the partner-organisations is estimated at 4 million.

Why create a new Fund for European Aid to the Most Deprived?

The European Social Fund (ESF) is, and will remain, the main EU instrument contributing to the fight against poverty and social exclusion.

However, a significant and growing number of European citizens are too far from the labour market to benefit from the activation measures supported by the ESF.

The Fund for European Aid to the Most Deprived (FEAD) will ensure that these people also benefit from European solidarity, by complementing the existing social cohesion instruments.

The Fund will focus on extreme material deprivation not only because that situation is potentially life-threatening, but also because insufficient food and a lack of basic goods makes it impossible to escape from poverty and exclusion.

How will the Fund complement the European Social Fund (ESF)?

The support provided by the FEAD will help people take the first steps out of poverty and social exclusion. The FEAD will help the most needy by addressing their most basic needs, which is a precondition for them to be able to get a job or follow a training course such as those supported by the ESF.

How would passive assistance help people come out of poverty?

First, ensuring people have enough food and basic goods such as clothes is a pre-condition for people to even hope to get a job, and so escape from poverty and exclusion. It for example makes it possible for them to participate in training. Second, the Fund is more than just passive assistance. National programmes that foresee the provision of material assistance have to include active social inclusion measures and the Fund can be used to partially fund such measures.

Will social groceries be able to participate in the scheme?

The Regulation for the Fund for European Aid for the most Deprived requires that the food and goods it finances must be distributed free of charge to the most deprived. However, this does not mean that social groceries distributing food against a small fee cannot participate in the Fund. They can participate as long as the products co-financed by the Fund are distributed free of charge.

Why did the Commission not simply extend the Food Distribution programme for the Most Deprived People (MDP)?

The programme of aid for the most deprived people (MDP) was created in 1987 to make the then agricultural surpluses available to Member States wishing to use them as food aid for the most deprived persons of the EU. However, successive reforms of the Common Agricultural Policy, combined with the simultaneous increase of food prices on international markets, mean that EU agricultural commodity markets are expected to remain balanced - on average - over the outlook period (2011-2020), without the need for market intervention.

Moreover, the European Court of Justice ruled on 13 April 2011, on a case brought by Germany and supported by Sweden, against the monetary allocations granted to Member States under the 2009 MDP for purchases of food on the market.

With the expected absence of intervention stocks, the MDP lost the rationale underpinning it and was therefore discontinued after 2013.

The new Fund for European Aid to the Most Deprived not only gives Member States more flexibility in terms of procuring food to be distributed, so that the money will go further, but also can be used for clothing and other essential goods (such as shoes, soap and shampoo) for distribution to the most vulnerable, such as homeless people.


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