08 February 1999
Finance officials in CAP talks

REPRESENTATIVES of European Union (EU) finance ministers are meeting today (Monday) to discuss cuts in the common agricultural policy, reports the Financial Times.

Todays meeting is the last before farm ministers convene in two weeks to agree a deal.

Several proposals will be under consideration.

Sweden and Denmark support “degressive” payments, which would decline year by year, while Austria wants to cut aid to large farmers.

France has become converted to cuts in aid because it wants to stop the EU implementing proposals requiring countries to “co-finance” subsidies. This would involve member states sharing the cost of the subsidies with the EU.

France wants the EU to cut direct payments for cereals farmers by 3% a year after 2001 and for other farmers by 1%. Small farmers would be given exemptions. France estimates annual savings in 2006 at Euro3.3 billion (£2.27bn), a quarter of which would be diverted to rural development.

Britain favours cuts of 4% a year in all direct aid payments after they reach their peaks. By 2006, annual savings would be Euro5.2bn (£3.6bn), one-fifth of which would go to rural development.

Post-2006 reduction rates should be considered in 2005, the UK suggests.

  • Financial Times 08/02/99 page 4