France sees support for strong EU farm budget

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France claimed a victory on Monday (29 November) in its bid to defend the European Union's farm budget from deep cuts, saying it had helped convince the bloc's executive to change its thinking on the policy.

Earlier this month the European Commission tabled a policy paper to reform the 55 billion euro a year Common Agricultural Policy (CAP) from 2014, but crucially it contained no figures on the future size of the CAP budget.

France – which wants to keep EU farm spending at its current level after the reform – saw this as a positive step, after leaked draft budget proposals from the Commission last year called for CAP spending to be diverted to new areas.

"A year ago, the Commission's proposal was to cut the CAP budget by 30 to 40%, and to abolish all tools for intervention in agricultural markets," French Agriculture Minister Bruno Le Maire said at a meeting of EU farm ministers in Brussels.

"The work done on France's initiative has allowed us to reverse things, and today we have a Commission proposal that is much more balanced," he said.

Whether France has indeed changed the Commission's thinking will only become clear next year, once the EU executive has published its proposals for the bloc's next long term budget for 2013-2020.

But Paris still faces a battle to convince some other EU states of its position, after Britain's Farm Minister Jim Paice said CAP spending, along with the EU's overall budget, should fall substantially after the reform.

The EU's biggest paymaster – Germany – did not comment on the future size of the CAP budget, but its call for general fiscal restraint was far from a ringing endorsement of France's position.

"All financial decisions have to be seen within the overall context of the EU budget. As you know, Germany is in favour of limiting the future budget to a maximum 1% of GDP," German state secretary for agriculture, Robert Kloos, said.

East-West tensions

Germany and France did agree that moves to distribute future CAP subsidies more equally between farmers in old and new EU states must happen gradually, and should not be based on a flat, hectare-based rate across the bloc.

In a joint paper published in September, the French and German farm ministers agreed the main objectives for the CAP reform, but failed to set a figure for the future budget.

In its paper, the Commission proposed ending the current link between subsidies and historical production levels, which sees farmers in Greece receive about 500 euros per hectare compared to less that 100 euros in Latvia.

But the bloc's executive rejected the idea of an EU-wide flat-rate payment, instead floating the idea of guaranteeing farmers in all countries a minimum percentage of the EU average rate. Le Maire welcomed the Commission's stance, and said France was ready to discuss a rebalancing of payments between east and west.

"But that doesn't mean that one euro to farmers in the Czech Republic, Poland or Hungary means the same as one euro to farmers in Spain, Italy, France or Germany. Rebalancing is good, but not a flat rate per hectare," he said.

Lithuania criticised the Commission's paper, which said that any changes to the way subsidies are distributed should be gradual, and avoid sharp cuts for farmers in any one country.

"The proposed methods and the transitional periods make us fear that a two-speed policy will be tolerated for a while yet, setting the old and new member states apart," Lithuania's Agriculture Minister Kazys Starkevicius said.

But EU Agriculture Commissioner Dacian Ciolo? rejected the accusation, and said new criteria for distributing subsidies between EU countries would not differentiate between old and new member states.

(EURACTIV with Reuters.)

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

Subsidies must be based on environmental criteria, the Commission said, with support "targeted at active farmers who really need it".

The proposals contain no details on the future size of the CAP budget, which consumes about €55 billion of the bloc's €130 billion annual budget.

This debate will start in July next year, when the Commission makes its proposal for the EU's long-term budget (2014-2020).

  • July 2011: Commission to publish legal proposal on CAP post-2013; Negotiations with European Parliament and Council to start.
  • 2012: Negotiations with European Parliament and Council.
  • 2013: Drafting of new CAP strategy and programmes.
  • 2014: Implementation of new CAP to begin.

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