UK out on a limb as EU ministersdiscuss CAP reform

01 April 1998

UK out on a limb as EU ministers
discuss CAP reform

By Philip Clarke, Europe Editor

WHOLESALE changes to Agenda 2000 will be needed if the European Commissions CAP reform plans are to have any chance of becoming law. That much is clear after yesterdays (31 March) special meeting of EU farm ministers in Brussels on the proposals.

Fifteen ministers spoke, and all had grave reservations about the reform proposals. The UK, however, was odd-man-out as the only member state thinking the reform plans did not go far enough.

One of the most outspoken against the proposals was Irelands Joe Walsh, who said the new proposals were “no longer a reasonable basis for negotiation”. Changes to the Agenda 2000 proposals since last summer would cost Irish farmers another Ir£1000 each in lost support, he claimed.

Beef and dairy farmers would suffer serious income falls as a result of inadequate compensation for excessive price cuts. There would be severe knock-on effects on sheep producers.

German farm minister Jochen Borchert believed the whole thrust of Agenda 2000 was wrong. Market conditions did not justify the support-price cuts proposed, of 30% for beef, 20% for arable and 15% for dairy.

He also criticised the timing of the reforms, in advance of next years World Trade Organisation talks: “We will be weakening our hand if we concede to the demands of our partners before the negotiations even begin. There is a real risk of us having to pay twice.”

This was echoed by French minister Louis le Pensec, who said the reforms had lost sight of the need to support farmers. He suggested cutting commodity prices to world levels was unnecessary. Instead, the EU should concentrate on exporting added-value products where the real opportunities lie.

Most ministers criticised the plans for making support payments dependent on environmental conditions (“cross-compliance”). Environmental policies should be kept separate, with separate levels of aid.

Meanwhile, Belgian minister Karel Pinxten warned of the dangers of “renationalising” the CAP by handing aid cash to Governments to distribute. “This runs counter to the very spirit of the CAP and could lead to trade distortions,” he said.

A few member states – notably Denmark, Sweden and the Netherlands – welcomed the general direction of Agenda 2000.

But the UK was out on a limb in suggesting the reforms did not go nearly far enough. “I welcome the cuts in prices, which will be welcomed by consumers, taxpayers and efficient farmers who want to back out of the current constraints,” said UK agriculture secretary, Lord Donoghue. “But they fall short of what is needed.”

He applauded the end of intervention for beef, and called for a 30% cut in milk prices, the end of quotas, and the abolition of set-aside. Compensation payments were set too high, he added, and should be phased out.

But he did reject the idea of capping support payments to larger farmers as being “fundamentally misguided”.

EU farm commissioner Franz Fischler was in no doubt that substantial changes will be needed to push his reforms through. But he noted that his predecessor, Ray MacSharry, had encountered equally stiff opposition in 1991 – and MacSharrys reforms had come to fruition in less than a year.