Documents considered by the Committee on 20 October 2010 - European Scrutiny Committee Contents

1 Food distribution to deprived persons



COM(10) 486

Amended draft Council Regulation amending Council Regulations (EC) No 1290/2005 and (EC) No 1234/2007 as regards distribution of food products to the most deprived persons in the Union

Legal baseArticles 42 and 43(2)TFEU; co-decision; QMV
Document originated17 September 2010
Deposited in Parliament23 September 2010
DepartmentEnvironment, Food & Rural Affairs
Basis of considerationEM of 4 October 2010
Previous Committee ReportNone, but see footnotes 3 and 6
To be discussed in CouncilNo date set
Committee's assessmentPolitically important
Committee's decisionNot cleared; further information requested


1.1 In order to avoid a build-up of public intervention stocks, the Common Agricultural Policy (CAP) has over the years contained provisions for the subsidised sale of produce to specified outlets. In particular, a measure[1] was introduced in 1987, enabling produce in intervention stocks to be supplied free of charge to designated charitable organisations for distribution to the most deprived persons in those Member States which choose to participate.

1.2 According to the Commission, that measure contributed to achieving two of the objectives of the CAP in the Treaty — to stabilise markets, and to ensure that supplies reach consumers at reasonable prices — and has proved to be a reliable supply of food for the most deprived. It also says that the need for it has increased following successive enlargements, and as a result of recent rises in food prices, but it also notes that, with the various reforms of the CAP, intervention has been removed in some sectors,[2] whilst for the others it has now been restored to its original function as a safety net, thereby significantly increasing the programme's reliance on market purchases.

1.3 It therefore proposed[3] in September 2008 that the existing Community legislation in this area should be amended so as:

  • to allow food to be sourced either from intervention stocks or from the market (though priority would be given to the use of suitable intervention stocks where these are available);
  • to enable a wider range of products to be distributed, allowing Member States to choose on the basis of nutritional criteria;
  • to provide for the distribution to take place under an EU plan which would be established for three years, rather than annually at present;
  • to provide for co-financing, with the EU making a contribution of 75% for 2010-12 and 50% for 2013-15 (85% and 75% respectively in Member States eligible for the Cohesion Fund).

1.4 As our predecessors noted in their Report of 29 October 2008, the UK has not participated in this scheme since the mid-1990s because of its dwindling intervention stocks and the bureaucratic overheads involved, and the then Government remained unconvinced as to the merits or appropriateness of the proposal, believing that the EU should act only where there are clear additional benefits. In particular, it considered that social measures are a matter for Member States, more properly and efficiently delivered through domestic social programmes[4] which take account of the prevailing situation and available funding in individual countries, and it therefore intended to work with like-minded Member States to oppose an expansion of the scheme.

1.5 Our predecessors also noted that the proposal was being made under the same legal base as the existing scheme (Article 37 of the EU Treaty), but that, since the focus of the revised scheme was more likely to be on the purchase of products on the open market, a number of Member States had questioned the appropriateness of that Article. In addition, they drew attention to the Commission's financial statement that the scheme would have no impact on the budget for 2008 or 2009, with any budgetary implications taking effect from 2010 and being determined when the first three-year food distribution programme (covering 2010-12) is drawn-up: and they pointed out that, should the EU budget be increased as a result of the new programme, this would have financial implications[5] for the UK.

1.6 In drawing the proposal to the attention of the House, they noted that it clearly raised some important issues on the future scope of the CAP, and the appropriateness of EU as opposed to Member State action. In view of this, the lack of clarity over the budgetary implications, and the questions over the proposed legal base, they recommended the document for debate in European Committee. That debate took place on 20 January 2009.[6]

1.7 Our predecessors also drew attention subsequently to a Special Report[7] (No 6/2009) by the European Court of Auditors on the EU's arrangements in this area, in which the Court highlighted certain concerns previously voiced by the UK and made a number of recommendations (including the need for the Commission to consider whether it is appropriate to continue financing such a measure through the CAP).

The current proposal

1.8 The Commission has now brought forward this amended proposal, which is intended mainly to align it with the Lisbon Treaty (notably by enabling the Commission to adopt delegated and implementing legislation under Articles 290 and 291 of the Treaty) and to reflect some of the views raised by the European Parliament. However, notwithstanding the comments by the Court of Auditors, it retains unchanged the main aspects of the original proposal, the only significant changes being to specify a lower minimum contribution from participating Member States of 25% (10% for cohesion countries), as compared with the 50% rate in the original proposal (25% for cohesion countries) after a three year transitional period, and to establish an annual ceiling of €500 million for the contribution from the EU budget. In addition, the proposal introduces enhanced reporting obligations on participating countries, and there would also be an obligation on the Commission to provide a report on the scheme in 2014.

The Government's view

1.9 In his Explanatory Memorandum of 4 October 2010, Minister of State for Agriculture and Food at the Department for Environment, Food & Rural Affairs (Mr Jim Paice) reiterates most of the points made by the previous Government, including in particular reservations over the proposal's appropriateness on subsidiarity grounds, and stresses that measures of this kind should more properly be delivered through domestic social programmes and national funding. He also points out that, although the Lisbon Treaty now provides the legal base, that now proposed (Article 43 TFEU) is similar to the one used for the existing scheme, and that there remains a question-mark over its appropriateness given the prospect of purchases being made in future from the open market.


1.10 In light of our role under the Lisbon Treaty to monitor compliance with the principle of subsidiarity, we ask the Minister to clarify to what extent the Government objects to this proposal on the grounds of subsidiarity and to what extent on the grounds of competence, since this was not clear from his Explanatory Memorandum. In the meantime, we are setting out our preliminary analysis below, and we would be grateful for the Minister's comments on this in his response.

1.11 It seems to us that, where intervention stocks are relied on for food aid, the Commission is competent to act under Articles 39(1)(c) and (e) and 43(2) TFEU, and that it is better placed to do so than a Member State, given its role in managing EU intervention stocks, as set out in Article 27 of Regulation (EC) No 1234/2007 (which establishes a common organisation of agricultural markets, and is thus a key component of the CAP). So we do not consider that food aid sourced from intervention stocks could be argued to infringe subsidiarity.

1.12 On the other hand, although the Commission says that "priority would be given to the use of suitable intervention stocks where these are available", where the food is sourced from the open market — which according to the Court of Auditors is more often the case — the link with the CAP is tenuous, and so the legal base no longer seems to us to be valid, as the Court of Auditors also found. Moreover, as there appears to be no alternative legal base in the TFEU, and Article 352 TFEU is not invoked, we question where the EU gets its competence to act. This, however, is an argument about competence rather than subsidiarity (if the EU is not competent to act, subsidiarity does not come into play). So our initial conclusion is that the proposal raises questions of competence rather than subsidiarity.

1.13 We would be grateful if, in responding, the Minister could also tell us to what extent other Member States share the Government's views, and what his assessment is of the likelihood of Member States opposing the Commission's proposal.

1.14 Finally, because the timetable for issuing a reasoned opinion is so tight, we would be very grateful for a response in time for our meeting on 3 November.

1   Council Regulation (EEC) No 3730/87 (OJ No. L 352, 15.12.87, p.1.) This measure was subsequently repealed, and integrated into Council Regulation (EC) No 1234/2007 (OJ No. L 299, 16.11.07, p.1.) which consolidated into one instrument existing sectoral legislation under the CAP. Back

2   Such as olive oil, sugar and maize. Back

3   See (29981) 13195/08: HC 16-xxxiii (2007-08), chapter 1 (29 October 2008). Back

4   Such as Healthy Start in the UK. Back

5   Either through its contributions to expenditure by other Member States (or, should it join the programme, being required to contribute 25% of any funds received under the co-financing arrangements, rising to 50% from 2013, in addition to which any receipts would serve to reduce the size of the UK's budget abatement). Back

6   Gen Co Deb, European Committee A, 20 January 2009, cols 3-7. Back

7   See (30962) 13721/09: HC 19-xxix (2008-09),Chapter 7 (28 October 2009). Back

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