Strasbourg, 14/11/2006 (Agence Europe) - In Strasbourg on Tuesday 14 November, the European Parliament decided, as expected (see EUROPE 9296), to reject the proposal introducing the possibility, for those Member States which wished to do so, of reducing direct payments to farmers by up to 20%. Any savings thus made were to be transferred to rural development programmes. This proposal followed on from the European Council agreement of December 2005 on the 2007-2013 financial perspective package. An overwhelming majority of MEPs supported the recommendation from rapporteur Lutz Goepel (CDU) to reject the proposal. The European Commission responded by saying it would consider how best to take this issue forward at one of its forthcoming weekly meetings. It did not say whether or not it intended to retract the proposal. Were the Commission to retain its proposal, the matter would go to the Parliamentary agriculture committee. If it were not to do so, an amended proposal would have to be submitted.
The EP agriculture committee considers that this kind of voluntary modulation would endanger the survival of many farms, distort competition, discriminate against farmers in some Member States and could result in the abandonment or re-nationalisation of the Common Agriculture Policy (CAP). Several EU Member States are also critical of the proposal (see EUROPE 9236), as is Mariann Fischer Boel, the Agriculture Commissioner, who has always expressed her preference for the compulsory modulation of payments which has been in force since 2005 (3% reduction in payments in 2005, 4% in 2006 and 5% from 2007 to 2012, with savings going to rural development).
The EP adopted two other proposals in the area of agriculture and rural development. Firstly, the report by Jan Mulder (ALDE, Netherlands) on technical modifications to the new rural development regulation (for the period 2007-2013) to exempt Portugal from co-financing obligations of €320 million (in view of the particular problems experienced by Portuguese agriculture) and to amend the rule setting a ceiling on Member States' expenditure (since the amount made available by the European Council for aid is less than that allowed for by the Commission in its initial proposal). Secondly, the report by Joseph Daul (EPP-ED, France) on extending the aid scheme for energy crops to new EU Member States (see EUROPE 9273 and 9272). (lc)