2 February 1996

Phased change is path with most to offer

THE "Fortress Europe" approach to the milk regime cant and wont continue, says Bill Madders, chairman of the milk section of the European farming unions and farmer co-ops organisation, COPA/COGECA.

But any rapid change to a totally free market would be strenuously opposed. "However, a phased change, allowing restructuring to continue at an acceptable rate, would bring as many opportunities as challenges," Mr Madders believes.

He says the main policy options currently being discussed are transitional measures to a freer market which also allow dairy farms to develop.

"The A and B quota system does have superficial merits with a high price for domestic markets and additional production at lower prices for export. This concept originates from dairy co-ops seeking to maintain their throughputs in the face of further quota cuts, and also farmers wishing to increase output without undermining their return from current production," he says.

But Mr Madders does not see the two-tier system gaining commission support "because the scope for fraud is mindblowing".

"Direct income payments, however, would allow EU milk support prices to be lowered. Lower prices would reduce the pressure on quotas and hence reduce their value, paving the way for their eventual elimination," he says.

But this scheme favours smaller farms and would impede the move towards a competitive industry. And although not personally in favour, Mr Madders suggests that this is the most likely outcome of dairy reform.

He believes that the current quota system will be extended to 2003, with direct support payments phased-in from 2000.

Bill Madders:Headage payments are the most likely way forward..