Premature consternation

RECENT press reports of radical changes to the Common Agricultural Policy (CAP) with a return to headage payments for stock farmers and subsidies for tobacco farmers, and an increase in the use of intervention, suggested a fait accompli.

RECENT press reports of radical changes to the Common Agricultural Policy (CAP) with a return to headage payments for stock farmers and subsidies for tobacco farmers, and an increase in the use of intervention, suggested a fait accompli.

It’s led to warnings about going backwards and trouble with the World Trade Organisation, and, from our Secretary of State for the Environment, Owen Paterson, suggestions of perversity and illegality.

But as so often, the reports were based on a misunderstanding of the EU reform process.

All that happened was that the Agriculture Committee of the European Parliament had met to deal with the 7,400 suggestions made by Euro-MPs for changes to the EU Agriculture Commissioner’s original proposals.

These had been boiled down to a 100 or so on which committee members voted. Inadequate information about the amendments led some to complain that they did not know what they were voting for.

Fortunately for them, the voting has been kept secret – perhaps that encouraged some, knowing that they would not be identified, to vote for wild ideas.

The next step is for all 740 Euro-MPs to consider the committee’s proposals. The Parliament’s considered view then has to be reconciled with those of the European Council (ie, the member states) and the Agriculture Commissioner.

Responsibility for moving this process forward lies with the Irish, who hold the rotating presidency of the EU until June 30.

It will help if the agreement for a 3% cut in the EU budget for 2013-20 just reached by the political heads of member states, at their all-night council meeting, is ratified by the European Parliament; this again has been reported as a done deal, but the Parliament is enjoying flexing its new muscles.

It is for ‘more Europe’, ie, greater spending; it may not acquiesce quietly.

The leaders evidently wanted to mark the cards of the agriculture ministers and the Parliament.

They said that, in the reformed CAP, capping of payments to large enterprises will be introduced by member states, 30% of the money allocated to the CAP must be used for ‘greening’ and member states may transfer up to 15% from funds for direct payments to funds for rural development. But there are qualifications.

Capping is to be on a voluntary basis; the need to have ecological focus areas on farms is not leading to land being taken out of production or to unjustified loss of the farmer’s income; and transfers between funds are to match funded by member states.

So it seems that member states will be free not to cap, will have some environmental leeway and may decide that there will be no transfers because they cannot afford them – which makes one wonder why the leaders bothered.

There are likely to be wide variations in the 27 member states – so much for a level playing field.

All that is clear is that English farmers should assume a 10% cut in their direct payments.

Hume Hargreave, a retired partner at Dickinson Dees

 
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