Brussels, 08/10/2008 (Agence Europe) - A much smaller reduction in support for farmers than proposed by the European Commission, an increase of just 1 per cent in milk quotas over two years, the option for member states to provide extra help for milk producers and livestock farmers, keeping the link between subsidies and production and retaining intervention schemes for sensitive sectors: these are the main points of the agriculture committee's vote on the CAP “Health Check” adopted on Tuesday evening 7 October. This opinion substantially changes the Commission's initial proposals. The European Parliament will vote in plenary session on 19 November, the same day as European agriculture ministers are due to reach political agreement on the issue.
“This vote gives us the basis for negotiation with the French Presidency,” said rapporteur Luis Manuel Capoulas Santos (PES, Portugal). He welcomed the “courageous decision” of French Agriculture Minister, Michel Barnier, who has committed himself to taking account of some parts of the European Parliament opinion, as if the co-decision procedure between Parliament and Council on agriculture was already in place, as contained in the Lisbon Treaty which has not yet been ratified by all member states.
More than 1,000 amendments to the Commission's proposal were tabled by MEPs. A series of compromise amendments were negotiated between the rapporteur and the political groups, dealing with the main points of the Commission's package of reform proposals. They were all adopted by a wide majority, apart from the one on the milk sector, which was rejected in favour of a series of other amendments. The main points of the EP agriculture committee are:
More reasonable modulation. The agriculture committee asked for modulation (reduction of aid, with monies being re-directed to rural development) to be increased from the current 5% to 6% in 2009 and 2010 and to 7% in 2011 and 2012. The Commission recommended 2% annual increases (7% in 2009, 9% in 2010, 11% in 2012 and 13% in 2013). Modulation does not affect farmers who receive less than €5,000 in aid per year.
Capping of aid. With regard to what is known as “additional” modulation (reduction of aid to large farms, the Parliamentary compromise calls for a 1% reduction in aid for farm businesses which receive between €100,000 and €199,999, 2% between €200,000 and €299,999 and 3% above €300,000 (the Commission proposed a 3% aid reduction between €100,000 and €199,999, 6% between €200,000 and €299,999 and 9% above €300,000).
Minimum payment. Instead of the basic payment of €250 per hectare per year proposed by the Commission, the compromise amendments allow member states to decide whether or not to grant direct payments above a minimum threshold to be decided.
Aid for milk producers. The amendments provide for a 1% increase in milk quotas but only for 2009-2010 and 2010-2011, and the option, for those countries which wish, to increase their quotas temporarily if the quotas in other member states are under-used. The Commission is to report before 31 December 2010 on the situation in the milk market and on the effectiveness of the management measures taken by countries within the framework of quota liberalisation (the report is to contain recommendations if necessary). In addition, the changes proposed allow for use of: - revenue from supplementary levies (fines) if quotas are exceeded; - savings made in the agricultural budget to form a milk fund (accompanying measures to restructure the sector). The Commission proposed an annual 1% increase in milk quotas until their withdrawal in 2014-2015.
Exemptions to decoupling of aid. The Commission would like the decoupling of aid to be extended to as many sectors as possible. The agriculture committee does not see things in the same way. It voted for: - retention of the premium on male bovines; - the retention of coupled aid for protein plants and dried fodder to help farmers in the current situation of high feed prices; - the retention of the current system (aid linked to production) for small-scale productions (rice, linen, potato starch) until 2013; - the retention of current aid for cotton producers; - the retention of restructuring aid in the sugar sector until 2013-2014.
Specific support for hard-hit sectors. The agriculture committee changed the proposal so as to allow member states the option of using: - up to 10% of their national ceilings to support milk and rice producers in hard-hit areas, and producers of beef and veal, mutton and lamb, and goatmeat; - and up to 5% to contribute to insurance and mutual schemes. In total, up to 15% of their community funding envelope for these two objectives.
Insurance and mutual funds. The compromise suggests: - extending insurance cover to all types of weather hazards, major economic losses resulting from animal or plant disease or insect attacks and collective risks in the event of contracts signed by a producer organisation. The funding of the premiums will rise to 50% according to the amendments (instead of 40% in the initial draft) by article 68 (70% in the new member states); - the possibility of using mutual funds in the event of animal and plant disease and in the event of weather hazards or natural disasters and funding costs arising from emergency vaccination (Community co-funding of these to a level of 50%, instead of 40%).
Market intervention. The committee on agriculture recommends: - re-establishing intervention for bread wheat, barley and maize (limiting this option to the last three months of the growing year to keep in place a safety net whilst reducing speculation); - keeping in place the possibility of intervention in the pork meat sector; - keeping private storage aid and sales aid for butter obligatory; - keeping in place the option for non-profit associations to buy cream, butter and concentrated butter at reduced prices in the event of surpluses; - removing export refunds on cereals and rice.
Risk and crisis management. The amendments voted in by the committee on agriculture have the effect of keeping in place the current article 44, allowing the Commission to adopt exceptional market support measures in the event of animal disease outbreaks (as well as insurance and mutual funds, which may prove insufficient in the event of a large-scale crisis).
New challenges. The compromise amendment provides for the possibility of spending, without any additional national co-funding, the sums of money resulting from the additional modulation on rural development measures designed to respond to the "new challenges" facing agriculture: climate change, renewable energy, water management and biodiversity. (L.C./trans.rt/fl)