Debate on the future of the CAP at European Parliament

On January 26th, 2011, the Agriculture Committee of the European Parliament held a public hearing to discuss major issues relating to the future of the Common Agricultural Policy after 2013: how to make direct payments fairer to farmers ? how to manage food price crises and improve rural development policies?

For the second time in a few months, Parliament’s plenary chamber hosted a public hearing with experts and stakeholders to help shape Parliament’s opinion on the future of the CAP after 2013, with a view to forthcoming legislative proposals on which MEPs enjoy full legislative powers.

The issues debated included overhauling the distribution system for financial support, introducing new market management tools and improving rural development policy.

Speaking at the end of the debate, Parliament’s CAP 2020 rapporteur Albert Dess (EPP, DE), said that the new policy must ensure a good objective distribution of direct payments, cut red tape and possess a great level of flexibility to take into account differences among Member States and among EU local and regional markets.

How best to reform direct payments?

Introducing the debate, Agriculture Committee chair Paolo De Castro (S&D, IT), asked MEPs and panellists to consider whether direct payments should be more equitably distributed among Member States and farmers. He also drew attention to the Commission proposal to cap these payments.

Luis Capoulas Santos (S&D, PT), wondering whether employment and environment would be included, declared to the panel that direct payments was the key question in the coming reform: (…) what should be the basis for calculating payments?. José Bové (Greens/EFA), by contrast, asked what measures would be taken to ensure that farmers are not paid below production costs.

Job creation should be included among the criteria for awarding direct payments, and training for farmers should be subsidised, said Arnd Spahn of the European Federation of Food, Agriculture and Tourism Trade Unions (EFFAT), who was the first farm trade union representative to be invited to discuss the future of the CAP. Michael Dower, speaking for the ARC 2020 group of agricultural and environmental NGOs, advocated abandoning the historical criterion for distributing aid and replacing it with national purchasing power.

Replying to several questions on whether direct payments should be capped to allow a different distribution of funds, Geneviève Savigny, spokesperson of “Via Campesina”, representing small farmers, said that capping was vital to justify such a concentration of public resources. Padraig Walshe, President of COPA, an organisation representing European farmers, disagreed and said that if payments were limited, it would be impossible to achieve higher standards.

n EU commodity market?

The second session of the hearing focused on whether existing risk management tools should be replaced by new ones and by commodity derivatives markets. MEPs also debated the link between the CAP and international trade policy. All speakers agreed on the need to equip the future CAP with a system of safety nets.

Corrado Pirzio-Biroli, President of the European Landowners Organisation (ELO) said that Europe needs to create an EU commodity market to stop relying on Chicago. Ms Savigny pointed out that financial speculation can undermine the benefits of derivatives markets.

On international trade and imports, James Nicholson (ECR, UK), and Lorenzo Fontana (EFD, IT), said the EU’s rigorous animal welfare, environment, health and quality requirements should be imposed on any good imported from non-EU countries. Paolo Bruni, President of the agricultural cooperatives federation COGECA, agreed with the two MEPs that the EU should be strict in protecting European farmers’ interests when negotiating trade agreements.

On risk management tools, Iratxe García Pérez (S&D, ES), proposed introducing a rapid response mechanism to deal with crises such as the recent milk and livestock price fluctuations.

Protect local markets to help least favoured areas

The third and final part of the hearing dealt with rural development and in particular least favoured areas (LFAs).

Marit Paulsen (ALDE, SE) said that the best thing to do for the LFAs is to support local and regional markets by creating infrastructure to enable farmers to place their products. Csaba Sándor Tabajdi (S&D, HU) argued that rural development is especially important to new Member States, where rural unemployment rates are high. He added that the differences between Member States must be taken into consideration.

The mutual consistency of contributions from all the EU regional and development funds needs to be enhanced, so as to generate territorial synergies, said Ms Savigny, even though localised farming can be a good response to world food market challenges. Finally, Arnd Spahn said research investment should be stepped up, to help depressed areas to grow.

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