The Malta Independent 9 December 2018, Sunday

Government's handling of EU funds is a disservice to farmers - PN EP candidate Peter Agius

Kevin Schembri Orland Sunday, 2 December 2018, 08:30 Last update: about 7 days ago

The government's handling of EU funds is a disservice to farmers and is prejudicing funding for the sector in the years to come, Peter Agius, PN candidate for the European elections and former Head of the European Parliament Office, told The Malta Independent on Sunday.

According to European Commission Data, out of the €129,769,197 from the European Agricultural Fund for Rural Development (EAFRD) for Malta, – which includes Malta’s national contribution – for the current 2014-2020 programming period, Malta had only spent €16,204,632 (12%) of these funds by end 2017. In addition, €32,885,274 had been allocated to selected projects. It is pertinent to note that the EU Commission website where this information was found, differentiates between the amount ‘spent’ by a country (expenditure reported by the selected projects) and the amounts in terms of financial resources allocated to selected projects.

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The ministry was asked to provide an update to this data, to which the ministry answered that “to date some €78. 9 million have been committed under this programme”. Asked to clarify this amount in terms of whether this meant that this amount was now spent or just allocated, a representative from the permanent secretariat said that this amount refers to money which has been allocated to projects, which the beneficiaries will receive on completion. “If the beneficiaries go ahead with their projects, all committed funds will be paid.”

In the same statistics above, as at 31 December 2017, Malta was last in terms of the percentage amount spent when compared with other EU countries.

Asked why Malta is so behind on its spending from this fund, the ministry said: “One cannot compare at face value the programmes across regions without taking into account the type of measures being implemented, and thus the scale and complexity of the interventions involved. Moreover, outlays on expenditure do not follow a linear pattern with the resultant impact on expenditure claims received in a given period.”

PN MEP candidate Peter Agius, talking to this newsroom, said: “According to its own official records, the government is two years late in committing EU funds for farmers. There are scores of farmers out there who want to invest in machinery or infrastructure who have held their projects back for years due to government inertia in committing EU funds. Out of the €40 plus million supposed to be committed to rural projects, only €5 million were actually processed up until May this year.

“This track record spells disaster for our ambition to attract EU funds in the next programming period 2020-2027. The European Commission has already declared that past spending will be a criterion for future commitments. Government is now in a state of panic to commit funds quickly. Farmers who have been waiting for answers for 18 months are now being contacted to provide revised quotes within five days. Projects which were kept in abeyance for years now have to be completed within months. To solve this problem we need three simple measures. The first is the political will to address the challenges of the farming community. That is absent at the moment. The second is serious planning over 5-10 years for EU funding with six monthly targets. Thirdly, comprehensive investment in the public service departments handling EU funds, which are manned by dedicated individuals who are however severely understaffed and under resourced. We must invest in their training and their motivation if we are to see a future for farming in Malta.”

“The future of farming in Malta is not a matter of concern for farmers alone. All of us as consumers have a lot to lose if we depend entirely on imports for our food. Our long-term food security is at risk right now.”

Information published by the Monitoring Committee 2014-2020 for the European Agricultural Fund for Rural Development (EAFRD) Funds in Malta, indicates that Malta has to spend a certain amount of money from this fund by 31 December 2018.

 “Article 38 of Regulation (EU) No. 1306/2013 empowers the Commission to automatically decommit funds that have not been used by 31st December of the third year following the year of the budget commitment (the N+3 rule). Malta’s first commitment year is 2015. Therefore, the amount of €20,905,107 (the 2015 financial allocation) must be paid by 31 December 2018 and eventually declared to the Commission.”

As at May 2018, Malta had spent €8,248,017.76, and the committee identified that the balance due to be paid by end of N+3 (31 December 2018) stood at €12,657,089.24.

 “Looking forward to 2019, Malta must also effect expenditure amounting to almost €21 million in EU funds – this being the 2016 commitment,” the Monitoring Committee has highlighted.

The Malta Independent on Sunday sent questions to the EU Affairs Ministry, highlighting the aforementioned. This newsroom asked whether the ministry believes Malta will spend the amount of €20,905,107 being paid from the fund by 31 December 2018, and asked for an update as to how much, thus far, has been spent in total. This newsroom also asked whether the ministry is concerned that Malta could lose funds.

“Malta remains committed to reach the N+3 target by end December 2018,” the ministry said.

The ministry was also asked for the number of applications for funds under the EAFRD currently awaiting processing, and other related statistics.

 “Of the 651 applications received some 550 have been awarded and received the approval letter. Today there are 70 applications under evaluation. These figures exclude over 6,000 farmers receiving financial support for maintaining their agricultural land.”

The last year that European Agricultural Fund for Rural Development funds from the 2014-2020 year can be used is 2023.

The ministry was asked for the average processing time of applications, and to justify why some applications have been pending for 18 months.

The current processing time for applications under the European Agricultural Fund for Rural Development is, on average, two to six months, the ministry said. “But this depends on the quality of the application submitted, clarifications needed and thus requested from the applicants and the feedback received.”

“Furthermore, in order to make the application process more accessible, potential beneficiaries can now apply on an open rolling call basis, which has led to bulk applications.”

 “Given Malta’s economic prosperity in recent years with a full employment situation, there are challenges to recruit and retain good talent in such an environment. Staffing the Managing Authorities dealing with EU funds is not immune to this reality as Government has indeed also indicated to Social Partners on the respective Monitoring Committee. Late last year we finalised a much more attractive financial package for employees in this area, both to retain the current workforce and to increase the headcount to ideal levels.

“Moreover, we have also established another Project Selection Committee dedicated to this programme. The two selection committees are meeting on a regular basis to adjudicate as expeditiously as possible the applications, taking into account the quality of the submissions received and ensuring good governance at all times.

 “We have also made it possible for farmers to claim reimbursement of expenditure incurred on investments prior to receiving approval of their application provided that the expenditure is deemed eligible for support.

 “These initiatives are having the desired impact in facilitating the adjudication and funding processes. We have now signed agreements for investments under the Rural Development Programme with numerous beneficiaries, including farmers, Local Councils, Local Action Groups (LAGs), government authorities and agencies. Although there will be challenges ahead we remain positive and envisage that this positive trend will continue in the future.”

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