Eastern EU states call for ‘bolder, speedier’ farm reforms

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Plans to reform the EU's Common Agricultural Policy (CAP) do not go far enough to level out differences in direct payments between the bloc's 'old' and 'new' members, said national parliamentarians from the bloc's Central and Eastern member countries.

Members of the European and national parliaments debated the upcoming reform of the CAP in Brussels on 12 July.

The aim of the interparliamentary committee meeting was to exchange views ahead of the European Commission's legislative proposals, which are due in October.

The debate took place just a few days after the Commission had tabled proposals for the EU's 2014-2020 budget, which shed some light on how the EU executive plans to reform the CAP.

Currently, direct payments between 'old' and 'new' member states vary from over €500 per hectare in Greece to less than €100 in Latvia – a result of a system of historical references used to calculate the amount of direct support, as well as the terms under which the bloc's Eastern enlargement agreements were struck.

To make the CAP "fairer", the Commission proposed to introduce a system of "convergence" to reduce income disparities between farmers in the 'old' Western European countries and the newer ones from Central and Eastern Europe.

According to the proposed system, member states with direct payments below 90% of the EU-27 average would close one third of the gap as of 2014, with disbursements gradually rising to 90% of the EU average by 2020.

Eastern member reject two-class, two-speed CAP

But several of the 'new' member states slammed this plan for being insufficient, calling for a more equal and fairer proposal that reforms the distribution of direct payments after 2013.

One representative from the Lithuanian parliament said that the proposed adjustment period to level out direct payments between old and new member states was "far too long". A Latvian MP agreed, calling for "bolder and speedier change".

Polish and Estonian national parliamentarians even argued that persistent inequalities in direct payments to farmers would actually "destroy competition" and "threaten the EU single market".

A Romanian MP likened the proposal to an airline on which some were "sitting in business class drinking champagne" while others sat in economy class.

Latvian MEP Alfreds Rubiks (European United Left/Nordic Green Left) said farmers in Latvia, whose payments currently represent 33% of the EU average, would see an increase to 52% only by 2020. "Is that fair?" Rubiks asked.

The national assembly of Slovenia also advocates greater uniformity of the direct payments system. But MPs there adopted a less radical stance, favouring "a gradual transition" from the current system to the new one to reflect differences between member states' level of economic development.

In a written statement, it noted that "the level of payments should take into account objective economic, natural and structural characteristics of member states and their agricultures".

Capping direct payments

Another topic of concern and divergence among national parliamentarians was the Commission's proposal to progressively cap support for Europe's largest agricultural holdings, which Brussels considers "receive a disproportionate share of direct income support from the CAP".

While a French representative argued that "capping is a must" because "otherwise small farmers will pay the highest price," a Czech MP said his country objected to the proposal because it had the biggest average farm size in the EU.

Austrian members seemed to support the idea of a cap, whereas the Germans were more reluctant to embrace such plans.

In a written statement, the Estonian parliament noted that the criteria for capping should be carefully chosen. "Land use in hectares, number of animals or number of employees cannot be solely taken into account," it warned.

If a farmer has made significant investments in modern technology and has reduced the number of workers through innovation, "this should not be 'punished' with capping of the support sum, if the criterion is based on paid labour," the Estonian Riigikogu stressed.

For the UK, representatives of the House of Commons said they believed capping first pillar payments "risks hindering the industry from becoming more competitive by discouraging farm consolidation". This, it added, "could be ineffective in the long term as farm businesses find ways to avoid the payment ceiling".

Reciprocity in greening agriculture

Nearly all parliamentarians, whether national or European, seemed to support the environmental ideas put forward in the current EU farm reform debate.

However, German representatives cautioned that greening measures should be "carefully selected" and "shouldn't lead to more red tape". The UK stressed that greening is OK in principle if it leads to both increased sustainability and productivity.

French representatives said the environmental measures in the CAP's first pillar must be "simple, harmonised and applied throughout the European territory". They also noted that the green measures should "correspond to genuine challenges" and that the additional cost needs to be calculated and adapted to the economic realities of each country, in line with the overall goal of simplifying the CAP.

French MPs, along with their Finnish and Hungarian counterparts, also stressed the importance of applying the same production criteria for imported food products as that applied to EU farmers.

Unless third-country production is subject to the same rules and standards as demanded of EU farmers, the situation will be "incomprehensible" for European farmers and consumers alike, they warned.

The chair of the European Parliament's agriculture committee, Italian Socialist MEP Paolo De Castro, and French President Nicolas Sarkozy have also been calling for reciprocity of standards in agricultural production in world trade. They are urging global agricultural powers to adopt similar environmental rules if they wish to export to Europe.

The European Commission unveiled its blueprint for reforming the EU's Common Agricultural Policy (CAP) in November 2010, proposing to increase subsidies to smaller East European farmers and to link direct payments to environmental and food security goals.

The Communication launched the institutional debate on post-2013 CAP and prepared the ground for the legal proposals to be adopted by the Commission during 2011.

On 30 June the EU executive tabled proposals for the EU's 2014-2020 budget, shedding also light on how the reformed farm policy could look like.

  • Oct. 2011: Commission to present legislative proposals to reform the CAP.

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