Brussels, 02/05/2013 (Agence Europe) - Community institutions went to the heart of the matter in their negotiations on reform of the common agricultural policy (CAP). Differences of opinion were revealed on a number of very important themes, such as coupled support and internal aid convergence. On Monday 29 April, the Special Committee on Agriculture (SCA) looked at the state of progress in the discussions following the new trilogues that have taken place (see EUROPE 10836).
Direct payments
The trilogue on 18 April tackled, first of all, the issue of voluntary coupled support (maintaining the link between payment and production volumes). The Council and Commission agree on the sectors and types of production that should benefit from coupled support and reject EP amendment 72 extending coupled support to all sectors contained in Annex 1 of the treaty. The Council and Commission considered that extending the scope of application would create a problem with regard to WTO rules and would run counter to the uncoupling of aid over recent years. With regard to the level of support, the EP and Council support a percentage increase. The EP is arguing for a 15% rate applicable to all member states and the option of having an additional 3% for oilseed production. The Council struggled to achieve a compromise on 19 March (a limit of 7% of the national envelope and 12% for countries already using this kind of aid) and will therefore find it extremely difficult to go above these percentages. Similarly, the possibility of an optional national supplement for suckler cows (EP amendment 85) will be difficult to accept for many member states (the Commission considers that such a payment should be degressive). Discussions on the themes will resume in the next trilogues. During the SCA, several countries (including France, Italy, Finland, Slovakia and Bulgaria) said that the Council could go in the same direction as the EP on coupled support, while other member states (the so-called liberal countries such as the United Kingdom, Sweden and Denmark) said that the Council position had to be maintained.
The question of basic payments, the discussion at the most recent trilogue focused on the transition to the new basic payment system and internal convergence. The EP accepts the possibility that, during the transition period towards the new system, that payment rights as they exist for countries that have a regional or hybrid system be maintained. The Council and the EP agree that countries benefiting from the single area payment scheme (SAPS) should benefit from a transition phase that continues up until 2020. The EP and the Commission accept the Council changes to the regional allocation of national ceilings (Art. 20). The EP and the Council agree on a transition for the first allocation of payment rights (Art. 21). With regard to taking into account payments received in the past (Art. 21(2)), the Commission and EP support compulsory application and the Council supports its voluntary equivalent (which would create a compatibility problem with regard to the WTO, explains the Commission).
On the question of internal aid convergence (redistribution between farmers in the same country), the EP and Council have similar concerns with regard to the negative effects of internal convergence as envisaged by the Commission. The two institutions think that a one size fits all application does not correspond to the diverse situations in the EU and that attaining complete convergence 2019 does not, for the time being, appear feasible. The Council and EP agree on the first stage of convergence at 10% (rather than 40% as proposed by the Commission) in order to mitigate the effect for countries that are moving towards a flat rate system. The Council and the EP agree on the fact that internal convergence should be applied to the whole of the payment (basic payment in addition to the “green” payment).
The Council and EP have different approaches for attaining internal convergence (relating to different methodologies regarding external convergence, namely the redistribution of payments between EU countries). The Council has problems with working out a minimum per hectare convergence rate. The EP considers that, given that the situation is not the same in the different countries, it will be necessary to build in flexibility for the first and following years. The EP believes that its approach is simpler and sits part-way between what is proposed by the Commission and by the Council.
The Commission has expressed doubts about the way in which amendment 53 of the EP is funded and which would grant countries a 20% leeway from the average unit value. The Commission also considers that the options proposed by the Council will not facilitate any significant convergence. It is suggesting that countries apply the same mechanism for internal convergence as that outlined for external convergence in the European Council conclusions of 7-8 February with the aim of reaching a minimum convergence by 2019.
The EP and Council need to reach an agreement on what mechanism should be implemented. Basing internal convergence on the model used for external convergence appears to be agreed upon.
Some countries (United Kingdom France, Italy, Spain, Denmark and others) supported the Presidency of the EU Council in its wish to maintain the Council position on internal convergence.
On the question of the national reserve, the EP and Council are broadly in agreement with regard to the adjustments needed to the Commission proposals. The EP is insisting that the national reserve provides payment rights to young farmers and to those newly entering the market (amendment 55). The Commission can live with this but the Council thinks that the choice should be made by the member states. It does appear, however, open to compromise. The Council and Commission considered that the EP proposal (also amendment 55) to authorise an annual reduction in the national ceiling to fund the national reserve (rather than a one-off) would be very complicated. The EP proposal to use the national reserve for allocating payment rights for specific sectors is not to the Commission's liking and the latter regards that this as a disguised “recoupling” of aid, which may be incompatible with WTO requirements. The EP may follow the Council on the adjustments involving the activation of payment rights (Article 25).
The Council and EP agree on a “redistributive” payment (Article 28a), which is expected to help small farms more. The Commission prefers the Council text, which would better define this payment. The EP may agree to the envelope for the redistributive payment being up to 30% of the ceiling in Annex II and remains open about the question of how many hectares should be eligible (the EP wants 50 hectares and the Council 30 hectares). The EP has concerns about farmers benefiting from SAPS being excluded from the redistributive payment. Further debate will therefore be necessary.
Single CMO
The trilogues on common market organisation (CMO) took place on 18 and 25 April. On the question of product distribution for school pupils, the three institutions would like harmonisation between the “fruit” and “milk” programmes. This harmonisation (without affecting the differences between the two programmes) could be obtained by including the target groups in the basic act. With regard to the milk programme, harmonisation could be obtained by including it in the more detailed provisions on national strategies in the basic act. The EP's amendment 158 on the distribution of olive oil and table olives to school students will be examined later.
There is a significant convergence on the positions regarding aid to the olive oil and table olive sector (new provisions on producer organisations, producer associations and organisations and inter-professional organisations).
On the question of aid to apiculture, most of the Council text has been maintained, with a few minor changes to take into account EP concerns.
The EP and Council are on the same wavelength with regard to aid to the hops sector.
Discussions have been postponed on the operational programmes regarding mountain milk.
With regard to labelling for wine, most of the Council text has been taken on board.
On quality products (PDO, PGI and traditional references), the EP accepts most of the Council text and withdraws several of its amendments.
Rural development
The SCA took stock after the trilogues of 17 and 24 April.
The EP and Council have differences of opinion on the notion of “active farmer” as proposed by the EP. The Council considers that rural development programme beneficiaries (second pillar of the CAP) can be very different to those that receive direct aid.
On transferring knowledge and advisory services (Articles 15 and 16), the EP and Council are close to an agreement, with a few points still pending. On quality systems (Art. 17), the positions of the two institutions are very close. On investment (Art. 18), most of the provisions have been agreed on, except those on investment to help young farmers.
On forests (Art. 22-27 and 35), most of the provisions have been accepted, including the definition of the forest managers council. On the other hand, the EP opposes the Council position on sensitive points, such as support for state forests and rapid growth trees.
With regard to be setting up producer groups (Art. 28), the EP and Council are expected to find some common ground. The EP and Commission support extending support to producer organisations. The Council would be prepared to support this, in so far as the second pillar does not include any support for development or maintaining producer organisations.
On agri-environmental measures (climate, organic farming, Natura 2000 payments and the water framework directive), the discussion involving the basic line is a sensitive subject on which the EP and Council have very different positions. The position of the EP is supported by the Commission, which accepts the inclusion into the basic line of greening, not just for agri-environmental commitments and the framework directive on water but also for organic farming and Natura 2000.
With regard to the zones subject to natural constraints (Art.32), the Council and Commission oppose the EP's request to push back implementation of reform in these areas. The Commission supports all the EP amendments, except the one on the combination of biophysical criteria. The EP will not give its agreement until it has an overview of the ramifications of the reform.
Finally, with regard to horizontal regulation, the Council supports the initial proposal on financial discipline so that the adjustments are set out by the Council alone. The Commission and EP believe that this should be a matter of co-decision. This is a very political subject to which the institutions are expected to return later. (LC/transl.fl)