2454 final report.pdf - Agra CEAS Consulting

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Evaluation of the Community Plant Health Regime: Final Report DG SANCO Evaluation Framework Contract Lot 3 (Food Chain) for solidarity dossiers where the origin of the contamination is not clearly identified, it may be difficult to decide on the responsibility or non-responsibility of the MS (this problem is compounded by the exclusion of natural spread from current provisions); The eligible costs only represent a small proportion of the total costs of an outbreak. The exclusion of major cost items such as production losses is a major disincentive. Notifications on the identification of new HOs in a given zone and presence of not known and not (yet) listed organisms is delayed by the absence of incentive to notify for 1) the farmers/growers to the NPPOs and 2) the NPPOs to the EC. This point leads to the conclusion that, by the time the EU receives notifications of outbreak, the pest is already quite well established. The main incentive for speeding up notifications is financial, i.e. more solidarity funding on the one hand and more penalties for late action on the other hand. It was also noted that the CPHR does not contain any other incentives for the MS and for the stakeholders, such as the legal liability within the production and trade chain. Several respondents to the general survey and interviewees also indicated the lack of disincentives to act against the specific objectives of the CPHR, such as the legal possibility of banning the movement of specified commodities from areas or countries not complying with adopted rules, or the effective enforcement of penalties for failure to act. In conclusion, the evaluation has confirmed the results of the earlier (2008) evaluation of the solidarity regime, in that the incentives provided by the regime remain relatively limited in a number of areas (intervention ex-post; exclusion of production losses; difficulty of assigning responsibility, particularly in cases of natural spread; lack of disincentives; non effective enforcement of penalties), for which there is still considerable room for improvement of the solidarity regime. 3.11.7.2 MS compensation schemes In terms of the sharing of responsibilities and costs at MS level, the government and/or industry sectors have developed mechanisms in several MS to provide assistance in case of outbreak. The sharing of costs can either be retrospective (i.e. after the outbreak) or prospective (i.e. in advance of the outbreak). In the first case, it mainly refers to compensation paid by Government after the outbreak 231 . A budget may have been foreseen in the State budget to that aim or not. Such schemes exist in 11 MS: BG, CZ, CY, ES, FI, HU, LT, LV, PL, PT and SI. 231 Any substantial support by a MS to small and medium-sized enterprises active in the production of agricultural products must be granted within a State aid framework that ensures Commission control and avoids distortions of competition. Aids to provide compensation for the losses incurred by plant pests and diseases and aids to prevent future losses may only be permitted by the Commission on the basis of Article 87 (3) (c) of the Treaty which provides that aid to facilitate the development of certain activities may be considered compatible with the common market provided that it does not affect trading conditions to an extent contrary to the common interest. Unilateral State aid measures which simply seek to improve the financial situation of producers but Food Chain Evaluation Consortium 246
Evaluation of the Community Plant Health Regime: Final Report DG SANCO Evaluation Framework Contract Lot 3 (Food Chain) In the second case, it refers mainly to the cases of mutual funds or of independent insurance schemes. Mutual funds: an industry sector (and possibly Government) contributes on an agreed individual basis to a common fund for the payment of the outbreak costs of affected business. This scheme exists in BE, DK and in FR. The schemes developed in BE and DK are private (i.e. contribution only comes from the growers) and target growers of seed and ware potatoes. The scheme developed in FR is a private one taken over by a public one (i.e. producers pay a fee to the manager of the professional solidarity fund that asks for a State contribution in case of outbreak). Such scheme exists since 2002 for seed potatoes and for Diabrotica virgifera on maize since 2009. Independent insurance schemes: an industry sector pays annual premiums towards a fund that underwrites all or part of businesses‘ potential losses. In the NL, the growers initiated such an insurance scheme in 1997, i.e. Potatopol, which sets premiums, collects premiums and pays claims on the basis of outbreaks of Ralstonia solanacearum and Clavibacter michiganensis subsp. sepedonicus confirmed by the official plant health service. Potatopol covers risks due to plant diseases risks only. The analysis of the 2008 JRC <strong>report</strong> on the agricultural insurance scheme 232 shows that, in several MS, the risks associated to plant diseases or insects are covered in the context of more general insurance scheme, covering also common risks like hail, frost, wind, flood, excess rain, drought, etc. This kind of insurance exists in AT, IT and HU. A complete overview of the compensation systems developed in the different MS is provided in Annex 4. From the analysis of the cost (and responsibility) sharing schemes applied in the MS, it can be concluded that: There are MS where no scheme applies; i.e. in the sectors where schemes have been developed, producers are not treated the same way in case of outbreak; In the case private schemes (mutual fund or insurance schemes) developed by an industry sector, financial intervention only occurs if strict prevention measures (generally defined by the Plant Health Authorities) have been respected; Schemes have been developed mainly in sectors of the industry which are not complex, having a similar producer base, few crops and few key pests and diseases (e.g. potatoes). The results of the specific cost survey indicate that the majority of MS CAs consider cost and responsibility sharing schemes to be the appropriate tools. which do not contribute to develop the sector are considered as incompatible with the common market. The State aid framework is established by the Commission Regulation 1857/2006/EC. 232 Agricultural Insurance Schemes, JRC , 2008 Food Chain Evaluation Consortium 247
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