Brian Gardner's Blog

CAP reform or mere trimming?

The European Commission’s proposals for so-called ‘reform’ of the common agricultural policy are nothing of sort. They are basically a justification for continuing the present policy into the post-2013 budget phase largely unchanged, As farm commissioner Dacian Ciolos has had to admit, the policy is currently suffering a ‘crisis of legitimacy’. Though he may be vague on what this means, any objective observer can explain: too much money spent on irrelevant income subsidies for those wo do not need them and not enough on those measures that are needed.

Prime element of the proposals is an attempt to redistruibute the €40-50 billion annual single farm payment pot so as to provide a greater share of this irrelevant largesse to the newer member states of central and eastern Europe (from whence the Commissioner himself hails). Ciolos is perhaps not old enough to remember the original purpose of production-linked income subsidies first incorporated in the 1993 MacSharry reforms: to compensate EU15 farmers for the scaling down of excessive market support mechanisms. Since the subsequent application of the CAP to the NMS involved raising support prices in those countries, there was no legitimate justification for paying the SFP in those countries in the first place.

Greater legitimacy would therefore be achieved by reducing the subsidies in all 27 countries as rapidly as possible and replacing the whole €50 billion a year shambles with a much lower priced policy concentrated in more precisely targeted policies aimed at specific environmental, economic and social problems.

Closer examination of the Ciolos proposals indicates that, with one exception, they are all measures included in and supposed to have been implemented in the 2003 Fischler reforms:

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  • Compliance with environmental, food safety and animal welfare standards:
  • Modulation of funds from the CAP’s “first pillar” (direct aids and market support) to its “second pillar” (rural development);
  • A ceiling on payments.

The exception to this pattern is the proposal to pay subsidies according to indicators such as land size rather than production volume. This is a proposal which is sure of majority opposition in Council. Likewise, the vaguely outlined ‘risk management toolkit’ to provide “a safety net for farmers”, in place of current intervention and export subsidies (a not very hardy perennial in EU farm policy proposals).

Unfortunately for Ciolos’ reputation, these proposals are so in line with the desire of the French Government to maintain the CAP in as much of it current free spending form as possible, as to reinforce the view that he is France’s ‘second Commissioner’.

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