New EU rules agreed for a faster, clearer and simpler European Solidarity Fund

The new legislative proposal amending the EU’s Solidarity Fund was approved today, Μarch 12, 2014 during COREPER following the successful mediation of the Greek Presidency.

The proposal :

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  simplifies the existing rules so that aid can be paid out more rapidly than is currently the case.

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  Foresees shorter administrative procedure for the submission of application with limited necessary information and by merging two decisions of the European Commission required in the past in one both for the granting of aid and the implementation of emergency operations to provide relief in an affected EU region or state into one agreement

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  provides for the first time to allocate advance payments to affected states and regions

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  specifies out more clearly who and what will be eligible, particularly for regional disasters. Moreover, the reform encourages Member States to put disaster prevention and risk management strategies higher on the agenda.

The European Union Solidarity Fund (EUSF) was set up to respond to major natural disasters and express European solidarity to disaster-stricken regions within Europe. The Fund was created as a reaction to the severe floods in Central Europe in the summer of 2002. Since then, it has been used for 56 disasters covering a range of different catastrophic events including floods, forest fires, earthquakes, storms and drought. 23 different European countries have been supported so far for an amount in excess of 3.5 billion €.

The Fund covers all MSs and is financed by additional funds of €3.5 bn outside the normal budget of the EU. Assistance from the Fund is limited to financing emergency operations carried out by the public authorities. Damage or loss of income suffered by individuals cannot be covered by the Fund. The EUSF can provide financial aid to Member States and countries engaged in accession negotiations in the event of a major natural disaster if total direct damage caused by the disaster exceeds €3 billion at 2011 prices or 0.6% of the country's gross national income, whichever is the lower.

The Minister for Development and Competitiveness of the Hellenic Republic Kostis Hatzidakis expressed his satisfaction with the agreement between the 28 member states of the EU :"We must be more responsive in helping EU countries and regions to rebuild and recover after significant natural disasters. The European Commission's proposal is a clear expression of solidarity to help Europe's regions or countries when they are most in need. The changes we have agreed will make the Solidarity Fund faster, clearer, and simpler to use. It will also encourage EU countries and regions to step up their efforts in preventing and managing disasters in the first place.

Key reforms:

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  Possibility of advance payments for the first time: 10% of anticipated contribution, capped at €30 million

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  Introduction of measures to encourage disaster risk prevention strategies

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  Clear definition of the scope of the Solidarity Fund limiting it to major natural disasters and extending it to droughts and other slowly unfolding natural disasters

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  Clearer rules on eligibility for financial assistance in case of regional disasters, New Regulation establishes a clear and single criterion: The natural disaster has to exceed a relatively low threshold of 1.5% of regional GDP for provision of assistance by the Fund in case of regional disasters. Compared to past increases the possibility of coverage for regional disasters (which are the most common in small Member States) as in the previous period there was an upper limit to 7.5% of the available budget of the fund versus 72.5 % for national disasters (which are more common in large Member States).