Brussels, 30/10/2002 (Agence Europe) - During a debate, on Tuesday, at the European Economic and Social Committee (ESC) on the consequences that the European Council of Brussels will have on CAP, Commissioner Franz Fischler felt that the conclusions of the Heads of State and Government do not "freeze" mid-term review or even the proposals that accompany it. In his view, some decisions could enter into force before 2006.
While recalling that the decisions of the Summit opened the road to enlargement and fixed the general conditions for the future of Common Agricultural Policy until 2013 ("which creates a certain amount of security in which to plan the policy", he admitted), Mr Fischler added that all new additional spending needed for reforms should be borne by current beneficiaries of the agricultural budget. One of the consequences of the summit is that 70% of direct payments for the new Member States and 2/3 of compensatory aid for reform of the milk sector decided in Berlin must be accommodated in a budget, which will be frozen at the level of 2006. Mr Fischler explained that the conclusions of the European Council demonstrate that measures which are part of the Berlin decisions (price of cereals and rye, set aside …) or which are necessary for the Doha Round or for other international obligations (such as the principle of unlinking aid) "can come into effect already before 2006".
Mr Fischler confirmed that spending under rural development programmes is not concerned by the ceiling of the budget. "Quite the contrary, the summit reminded us of the importance of the less favoured areas and of the multifunctionality of our agriculture", which meets the aims and challenges of the second pillar, stressed Mr Fischler, who hoped that the Member States "are serious with their declaration to plead for a strengthening of the rural development policy".
The Commissioner also admitted that the decisions taken by the Heads of State and Government naturally have an effect on mid-term review (mainly on the principle of compulsory modulation which consists in a 3% reduction annually of direct aid from 2004 to strengthen rural development policy). He finally affirmed that the need to pursue the CAP reform process remained intact: "We need a further market orientation in agriculture. The agricultural production has to orientate itself according to the demand, i.e. at the desires of consumers and not at artificially created price incentives".
Mr Lamy considers the ceiling of agricultural spending will make more reforms necessary
During a press conference on Wednesday (see other article), speaking in response to questions on European farm subsidies and their impact on developing countries, Pascal Lamy acknowledged that some aid linked to production may penalise certain developing countries. He also stressed, however, the Commission's attachment to defend "six to seven million farmers who must remain on the land" even though some may think they are superfluous. Speaking of a first analysis, made with Franz Fischler, of European Council decisions on the ceiling of the agricultural budget as of 2007, he noted that the Fifteen have decided to use "unprecedented budgetary discipline". After having recalled that the Commission had placed CAP reform on the table because it thought it was necessary to determine "how before how much", he stressed that the European Council has decided to do the opposite and that it will now be necessary to adjust reforms in order to respect this new financial allocation. Analysis of the figures has still to be finalised, but "my intuition is that more reforms are necessary", said Mr Lamy, who noted that the EU is announcing substantial reduction in farm aid at a time when the United States is increasing the "Farm Bill". "When one looks at these two signals, one quite easily sees how the positions of the WTO are taking shape", he added.