Brussels, 14/02/2013 (Agence Europe) - Technical examination continues of a number of sections in the common agricultural policy (CAP) reform. On Monday 11 February, this allowed some progress to be made on rural development (risk management, irrigation) and on aid to young farmers. Countries were divided over the notion of reference price for market measures. The Irish Presidency of the EU Council of Ministers trusts that the Council will decide on its approach at the Agriculture Council of 18 and 19 March, before negotiating a final compromise with the European Parliament by end June.
Rural development. The Special Committee on Agriculture (SCA) discussed risk management, as it had done the previous week (seeEUROPE 10781). The Irish Presidency drafted a proposal for amending Articles 38 and 39 of the regulation on rural development. It introduced an explicit reference to indices for calculating losses in both articles, although this is a general reference (no indication of the type of index to be taken into account), with each country being able to use the index that it finds the more suited to its specific characteristics. The Presidency also considers that, despite the fact that some member states are opposed to the income stabilisation mechanism, a large majority of delegations at the Council agree to allow the mechanism to be set in place voluntarily. Member states are divided over the mid-term review clause. From now on, that theme will be an element for negotiation with the European Parliament. EU experts at the SCA generally felt that the Presidency's proposal allows the road to compromise to be opened, although some countries (Germany, United Kingdom, Denmark, for example) challenge the provisions of Article 39 on agricultural mutual funds.
Another theme that came under discussion was investment in irrigation. A large majority of member states supported the Presidency's compromise on this. Only a small number of countries - such as Poland and Portugal - considered that the system put forward was still too complicated.
Amendments introduced by the Presidency aim at increasing flexibility for investment in irrigation. For example, investment in the re-use and recycling of water would be exempted from demands pertaining to water saving. Also, irrigation installations recently abandoned due to the fact that urban areas spread at the expense of agricultural land could be displaced elsewhere - for example, to a rural zone in the same region -without this being considered as an increase in the irrigated surface areas. Demands regarding environmental assessments have been simplified. A specific derogation concerns investment for existing reservoirs, as long as they respect the framework directive on water.
Direct payments. A majority of member states supported the Presidency's proposal on the voluntary nature of aid to young farmers, as provided for in the first pillar of CAP on direct aid and market spending (there are also provisions in favour of young farmers under the 2nd pillar, rural development). The Commission remains totally opposed to this approach. Countries having earlier indicated their preference for a compulsory approach - such as Spain and France - finally gave their support to the compromise. Others, however, such as Romania and the Netherlands, remain opposed to the voluntary nature of the scheme.
Single CMO. As during the Agriculture Council of September 2012, the SCA delegations were very divided over the notion of reference price. The Presidency called on the delegations to put their points of view forward regarding: - the possibility of introducing single review of reference prices for sectors for which there is no compulsory public intervention; - an amendment voted by the EP agriculture committee that suggests the introduction of a reference price regular review mechanism, the establishment of a reference price for olive oil and an increase in reference prices for beef and veal. Several member states - such as Denmark, Sweden, Germany, the United Kingdom and the Netherlands -pointed out that review of reference prices would run counter to CAP market guidelines. For those countries, the budgetary impact of a possible increase in reference prices and the fixing of such prices for other food-stuffs, would be considerable. France, Portugal and Spain, in particular, support the EP's proposals on olive oil and beef and veal. They underline that, more than the prices themselves, it is the margins (integrating production costs) that should serve as indicators on the state of the market. Although the position taken by delegations on regular review or single review (PSCY) is not very clear, many countries (Germany, France, Denmark ,Finland and the Netherlands to name but a few) defend the use of Article 43(3) of the treaty (exclusive Council competence) for fixing reference prices.
Horizontal regulation. The Council's legal service presented to delegations its opinion concerning the Commission's proposal on the publication of CAP beneficiaries. The legal service considers that, in order to comply with the EU Court of Justice's opinion on the balance between the right to privacy and the public control of funding, the Commission must ensure that its proposal, as it is now, is necessary (that is, that there is no other way to reach the objective fixed). The Commission's proposal aims to take into account the Court's ruling of 9 November 2010 which states that previous provisions concerning the exposure of CAP beneficiaries was not valid. We recall that the EP agriculture committee rejected the Commission's proposal aimed at making public the names of beneficiaries and municipalities that receive direct payments and those that benefit from rural development programme funding (see EUROPE10771). (LC/transl.jl)