3 School milk and fruit schemes
| (a)
(35785)
5958/14
COM(14) 32
(b)
(35786)
6054/14
COM(14) 31
(c)
(35787)
6059/14
SWD(14) 28
+ ADDs 1-2
(d)
(35788)
6062/14
SWD(14) 29
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Draft Regulation amending Regulation (EU) No. 1308/2013 and Regulation (EU) No. 1306/2013 as regards the aid scheme for the supply of fruit and vegetables, bananas and milk in educational establishments
Draft Council Regulation amending Regulation No. 1370/2013 determining measures on fixing certain aids and refunds related to the common organisation of the markets in agricultural products
Commission Staff Working Document: Impact Assessment accompanying draft Regulation amending Regulation (EU) No. 1308/2013 and Regulation (EU) No. 1306/2013 as regards the aid scheme for the supply of fruit and vegetables, bananas and milk in educational establishments
Commission Staff Working Document: Summary of the Impact Assessment accompanying draft Regulation amending Regulation (EU) No. 1308/2013 and Regulation (EU) No. 1306/2013 as regards the aid scheme for the supply of fruit and vegetables, bananas and milk in educational establishments
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| Legal base
| (a) Articles 42 and 43(2) TFEU; co-decision; QMV
(b) Article 43(3) TFEU: consultation; QMV
(c) and (d) —
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| Documents originated
| 30 January 2014
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| Deposited in Parliament
| 6 February 2014
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| Department
| Environment, Food and Rural Affairs
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| Basis of consideration
| EM of 17 February 2014
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| Previous Committee Report
| None; but see footnote
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| Discussion in Council
| See para 3.10 below
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| Committee's assessment
| Politically important
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| Committee's decision
| Not cleared; further information awaited
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Background
3.1 The EU has had in place two similar
instruments specifically targeting children:
· the School Milk Scheme, through
which grants have been available since 1977 for the sale of reduced-rate
milk products in schools;
· the School Fruit Scheme,
which has co-financed the distribution of fruit and vegetables
in schools since the 2009-10 school year.
3.2 The Milk Scheme in particular was
originally seen as a way of disposing of surplus stocks, but the
Commission gradually came to identify better nutrition as the
main objective, and with the aim of both Schemes being to increase
or maintain the consumption of these products in the short term,
whilst having an educational influence on eating habits in the
long term. However, there have been a number of significant differences
between them, notably:
· Aid for school milk has come
in the form of a fixed-rate EU subsidy of €18.5 for 100 kg
of milk, but, although there has been a maximum subsidisable quantity
of 0.25 litre per school day and per pupil in regular attendance,
there has been no budgetary ceiling, the EU contribution having
been calculated on the sum of the eligible applications received.
There is no obligation on Member States to contribute, and each
educational establishment decides whether or not to take part.
Also, although the scheme may take a number of different forms,
there are three main models — subsidies for milk products
included in canteen meals; and milk sold outside canteens either
at a reduced price, or distributed free of charge.
· EU aid for fruit and vegetables
(including processed fruit and vegetables and banana products)
has been based on a single distribution model, and has accounted
for 50%[7] of the cost
of the produce distributed (including certain associated charges),
with the remainder usually being financed by the Member States.
The overall budget ceiling of €90 million has been shared
among the participating Member States, with each Member State
free to decide, through its national strategy, how to divide its
national allocation among potential applicants. However, this
support has been conditional on the mandatory adoption of accompanying
educational measures, and, although ineligible for EU funding,
these were considered a crucial part of the scheme.
3.3 Despite the School Fruit Scheme
having sought to take on board some of the criticisms made of
the School Milk Scheme, a number of subsequent external evaluations,
including a Special Report[8]
by the Court of Auditors in 2011, concluded that, although the
underlying rationale of the two Schemes was still relevant, consumption
— particularly of fruit and vegetables — had continued
to decline in the face of increased preferences for highly processed
and convenience food stuffs, which are often high in added sugars,
salt and fat. Furthermore, this tendency was expected to persist
in future, with children, particularly in urban areas, becoming
increasingly disconnected from food traditions and methods of
production. It was also suggested that the impact of the Schemes,
both in encouraging consumption in the short term, and in bringing
about a longer term change in eating habits, had been limited,
and that this required certain weaknesses in their design and
functioning to be addressed.
3.4 As a result, a number of changes
were incorporated in Regulation (EU) No. 1308/2103, which gave
effect to the most recent reform of the Common Agricultural Policy
(CAP). This included increasing the basic rate of EU co-financing
for the School Fruit Scheme from 50% to 75%; enabling co-financing
to be applied to certain accompanying educational measures within
a threshold to be established by the Commission; and increasing
the overall budget from €90 million to €150 million
a year. However, it maintained both schemes as two separate systems
with different financing arrangements, and it was not possible
at that stage to agree more than a limited change to the School
Milk Scheme, requiring Member States to produce national strategies
for its implementation. There also continued to be no overall
ceiling on EU expenditure under the Scheme.
The current proposals
3.5 According to the Commission, this
still leaves a number of significant problems identified previously
by the Court of Auditors, particularly as regards the structure
of the School Milk Scheme and the lack of coordination, consistency
and common identity between it and the School Fruit Scheme. It
has therefore proposed in document (a) that Regulation (EU) No.
1308/2103 should be amended so as to establish a common legal
and financial framework for the distribution of fruit and vegetables
and milk to schoolchildren. This would be based largely on those
existing elements of the two schemes which are considered to have
worked well, but would:
· re-focus distribution on
two core products, which are the most widely distributed at present
— fresh fruit and vegetables (including bananas) and drinking
milk — and in the process exclude processed products and
reduce the organisational burden for schools;
· introduce separate budgetary
envelopes of €150 million for fruit and vegetables (as agreed
under the CAP 2020 reform) and €80 million for milk to be
allocated to Member States, although Member States could within
certain limits transfer their allocations between the two Schemes;
· within these allocations,
thresholds would be established for supporting educational measures
and other eligible activities, such as evaluation, monitoring
and communication;
· the level of EU contribution
for fruit and vegetables would be limited through a maximum aid
per portion, rather than through co-financing levels as at present,
thereby simplifying the Scheme, bringing it into line with the
School Milk Scheme in this particular respect, and alleviating
the large disparity in the price for products distributed;
· the level of subsidy for
school milk would be increased in order to reduce the deadweight
effect identified by the Court of Auditors, and increase the cost-effectiveness
of distribution, and Member States would be able to continue to
provide national top-ups (or attract private funding);
· the requirement for supporting
educational measures would be extended to milk distribution, thereby
bringing the two Schemes into line, and would focus on long term
objectives, covering agricultural issues, nutrition and health,
and environmental matters, thereby reconnecting children with
food, agricultural production and farmers: and, subject to approval
by national health authorities, Member States would be able to
choose educational themes covering agricultural products other
than fruit and vegetables and milk (such as yoghurt, processed
fruit and vegetables, and honey), with the objective of promoting
healthy diets.
3.6 The other proposal at document (b)
would simply amend Council Regulation (EU) No. 1370/2013, which
fixes aid levels under the Common Agricultural Policy, including
those for the School Milk and Fruit Schemes, to reflect the latest
changes now proposed.
The Government's view
3.7 In his Explanatory Memorandum of
17 February 2014, the Parliamentary Under Secretary at the Department
for Environment, Food and Rural Affairs (George Eustice) says
that the Government is committed to encouraging and helping children
and adults to eat more healthily, and that the Commission's proposals
are welcome in principle because they aim to increase the share
of fresh fruit and vegetables and milk products in children's
diets. He adds that they are of direct interest to the UK, which
not only participates in the School Milk Scheme, but also provides
additional 'top-up' subsidies from national budgets to schools
receiving EU funds (although it does not currently participate
in the EU School Fruit Scheme, taking the view that it is financially
more effective to run its own scheme).
3.8 The Minister welcomes the fact that
the proposals seek to reduce the administrative and organisational
burdens currently associated with the implementation of the Schemes,
and supports the principle of greater simplification and streamlining.
In particular, he notes that Member State participation in the
School Milk Scheme would in future be on a voluntary basis, but
that the proposal would not prevent them continuing their own
national initiatives. However, he says that the Government will
scrutinise the Commission's main recommendations closely to ensure
they genuinely improve implementation, and do not create additional
burdens for paying agencies, local authorities or schools, which
run the risk of reducing the overall value for money of the schemes.
3.9 He adds that the UK will work with
the Commission and other Member States in order to achieve better
value for money, and a scheme which is simpler overall for beneficiaries,
administrators and paying agencies, and can be operated more cheaply
and efficiently than the current regime, though he cautions that
it is not at this stage clear that the proposals would achieve
these aims. However, the Government will be undertaking, and expects
to make available in May 2014, its own analysis of the proposals,
including the impacts of alternative aid rates and the administrative
costs, its aim being to inform and influence the negotiations.
It is also considering the need for, and timing of, any formal
domestic consultation process and will keep Parliament informed.
3.10 The Minister says that, although
discussions in Council Working Groups are expected to begin in
March 2014, the process of negotiating and agreeing the different
elements in the package may take one to two years.
Conclusion
3.11 We note that the aim of these
proposals is to further streamline and re-focus the operation
of the School Milk Scheme and School Fruit Scheme in response
to previous criticisms, including those from the Court of Auditors,
and that they are in general welcomed by the Government. On the
face of it, therefore, they seem unlikely to give rise to any
major issues, but, as the Government has said that it will be
looking more closely at the proposals as part of its own analysis,
we are holding these documents under scrutiny, pending receipt
of that information. In the meantime, we think it right to draw
them to the attention of the House.
7 75% in regions designated under the Convergence Objective. Back
8
(33301) 16099/11: see HC 428-xlii (2010-12), chapter 21 (23 November
2011). Back
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