More rural spend, less aid, says EU

3 May 2002

More rural spend, less aid, says EU

EU FARM ministers have given broad support to commission plans to cut farmers aid cheques and increase spending on rural development as part of this summers mid-term review of Agenda 2000.

But exactly how this should be done remains open for discussion, with different member states holding different positions.

Following this weeks informal farm council in Murcia, Spanish minister, Miguel Arias Canete claimed there was "majority agreement on the need to enhance rural development and transfer resources from the first to the second pillar of the common agricultural policy".

Commission proposals on the mid-term review, to be presented at Junes farm council, would include "compulsory community modulation" (cuts in direct payments) to move funds towards rural development. "Nobody is talking about cutting the budget; this is about transferring resources," said Mr Arias Canete.

This view was endorsed by other member states, according to reports on the AgraNet wire service.

Some delegations – notably the UK, Denmark and Italy – said this should be done by progressively phasing out direct income aids over time, a process knows as degressivity that found brief popularity during the Agenda 2000 negotiations in 1999.

Others – including France, Germany, Austria and Sweden – favoured a fixed cut, either targeted at larger farmers or applied across-the-board.

Farm commissioner, Franz Fischler confirmed money would be moved from first to second pillar supports, and suggested the rules could be changed to end the need for member states to match-fund any cash released.

This has been a major deterrent to voluntary modulation.

Rural development currently accounts for just 10% of the k44bn (£27bn) common agricultural policy. &#42

These developments are likely to dismay members of the European Peoples Party of right-wing MEPs. Last week they launched a new policy paper saying any moves to bolster the second pillar of the CAP must be with new money and not by cutting existing farmer supports.

EU farmers group, COPA, went further, saying there should be no mid-term reform of the CAP at all. "When the council adopted Agenda 2000, it only invited mid-term reports," said president Gerd Sonnleitner. "Anything more could only be justified if expenditure threatened to surpass the ceiling fixed in Berlin. This is obviously not the case."

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