Parliament Report on the CAP Health Check and Agriculture Council Compromise on EU’s agricultural future

French EU Presidency’s Conclusion EU’s agricultural future

On 20 November 2008, the Council met in order to discuss the reform of the CAP. After the meeting, the status of the document was understood as the Conclusions from the EU Agriculture Ministers. But, the decision by Latvia, Sweden and the UK not to back the document meant that the document was adopted not as conclusions of the EU’s Council of Ministers but as conclusions of the EU presidency, which carry significantly less clout.

Michel Barnier, France’s agriculture Minister and the current chair of the Council of Agriculture Ministers, said he regretted the decision to downgrade the status of the proposals, but he said that the upcoming Czech Presidency of the EU would revive the conclusions and would put the document at the top of the agenda of an informal ministerial meeting in May 2009.

Given its lesser status, it is now unclear whether the text will be discussed at a summit of EU leaders on 11-12 December, as was Barnier’s original wish.

More precisely, these conclusions advocated agreed to shift money to rural development from 2009 and progressively liberalise the EU dairy sector before milk production quotas expire in 2015.

According to the agreement, more subsidies for farmers will now have to be spent on measures to protect the environment, rather than measures to support farming income that are linked to production levels.

Backed by more liberal EU countries like the UK and Denmark, Mariann Fischer-Boël, the EU farm commissioner, wanted 8% of all EU farm payments to be devoted to rural development. But these proposals faced resistance from France, Italy and Germany, and the percentage was reduced to a compromise figure of 5%. The compromise, adopted by qualified majority vote, meant that some member states either abstained from voting or voted against it.

The compromise includes the following:

 Shifting more EU subsidies away from traditional incentives for farmers to boost production and towards rural development and conservation:

o All farms receiving at least €5,000 must shift 5% of EU aid into rural development projects by 2012, in addition to the 5% that is already mandatory. The Commission had hoped for at least an 8% shift.

o Big farms who receive over €300,000 in EU aid must shift an additional 4% by 2012.

 Increasing milk quotas: Quotas are increased annually by 1% between 2009 and 2013 [total of 5%] as proposed by the Commission. However, Italy may directly increase quotas by 5% in 2009, arguing that it needs more milk to produce its cheeses.

 The opportunity for Member States to redirect EU farm aid towards sensitive sectors, productions or geographical areas.

Parliament Report on the CAP Health Check

Shortly before the Council agreement, the Parliament adopted a position on the CAP Health Check. MEPs backed smaller cuts in farm aid, a limited increase of milk quotas and special aid for milk producers and livestock farmers. It also called for smaller funding shifts towards rural development, instead maintaining intervention schemes and the link between subsidies and production for certain sensitive sectors.

The Parliament’s views on the CAP health check are not binding, but if the Lisbon Treaty enters into force, the House will have co-decision powers on agriculture.

By the end of 2012, the Commission will publish a report on the implementation of the Health Check.

For further information

DG Agriculture

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