Member state experts and the European Commission, meeting on Thursday 25 and Friday 26 August, finalised the precise details of the measures agreed in July to help farmers weather the crisis currently affecting the dairy, fruit and vegetables and pigmeat sectors (EUROPE 11596, 11603).
The budgetary implications of the €500 million package will be included in the autumn in an amending letter to the draft budget for 2017.
The aid package comprises a number of legislative acts: - three delegated regulations (an envelope of €350 million to be shared among the member states; the voluntary €150 million scheme to reduce milk production; and the extension of public intervention for skimmed milk powder until the end of February 2017); and four implementing regulations – voluntary coupled support in the milk sector; authorisation of a higher percentage of direct aid to be paid early; a six-month extension of Article 222 of the regulation on the common organisation of the market (which allows voluntary agreements to be concluded between milk producers on milk production planning); and the extension of private storage aid for skimmed milk powder until the end of February 2017. The texts will be published in the Official Journal of the EU in the coming weeks, the Commission says.
€150 million worth of incentives to cut production. This measure seeks to encourage voluntary reduction of production. The scheme is EU-wide, so it will be up to each individual dairy farmer to decide whether he/she wants to participate – with the prospect of a payment for reducing production in the period from October to December 2016, relative to the same period last year.
Technical points were finalised by the experts: maximum claim (50% of production in the reference period); penalties for failing to reduce production for the full amount offered; the various deadlines, and the relevant administrative and control rules.
The scheme will be run as a “simultaneous examination”. The Commission will accept all bids submitted by the relevant member states by the agreed deadline, unless the claims exceed the ceiling volume (1.07 million tonnes) corresponding to the available budget, in which case a reduction coefficient will be applied. Further periods (for November-January, December-February, and January-March) will follow until the budget volume is reached. Once the period is over, farmers will then have 45 days to provide the proof that they have reduced production, following which the aid can be paid.
Conditional adjustment aid. The envelope of €350 million (plus national co-financing of up to the same amount) will be shared among the member states. The financial aid available to each country takes account of the principal features of the country’s sector, including production, market prices and the numbers of small farmers. The member states will enjoy a degree of flexibility in determining the measure or combination of measures that they will make available to farmers – such as methods of extensive production, aid to small farms, cooperation projects, new aid measures to reduce production, etc. It will also be possible to cover other livestock sectors.
The aid will be affected to farmers who undertake action to stabilise the market, the Commission says. Germany will take the lion’s share, with a national envelope of €58 million, ahead of France (€49.9 million), the United Kingdom (€30.2 million), Poland (€22.6 million), Italy (€21 million) and Spain (€14.6 million).
Other technical adjustments. The numerous member states which grant optional coupled support to the dairy sector (often per head of cattle) will be allowed to waive the requirement to maintain the number of cattle in 2017. In addition, as last year, they will be allowed to make advance payments of up to 70% of direct payments from 16 October and up to 85% of area-based rural development payments, without on-site checks having to be carried out.
Public intervention on skimmed milk powder, which is due to end on 30 September, will be extended until the end of February 2017, after which date the normal period will resume. The ceiling for public purchasing has been set at 350,000 tonnes until the end of December 2016.
Private storage aid schemes for skimmed milk powder have also been extended until the end of February 2017. This extension applies to both the standard system (storage of between 90 and 210 days) and the longer system (365 days storage).
Following an initial aid package of €500 million in September 2015 and further measures in March of this year, farmers can now look forward to a fresh raft of measures worth €500 million to help offset the effects of the current crisis. European Agriculture Commissioner Phil Hogan highlighted in July that, since the start of the crisis in agriculture, the EU had spent €1.5 billion to help its farmers. (Original version in French by Lionel Changeur)