Fischler creates himself a beef aid dilemma

Date: 26/09/1996

AGRICULTURE Commissioner Franz Fischler has seriously reduced his room for manoeuvre by agreeing to extend beef buy-in schemes and release spare cash to prop up EU beef farmers, leaving longer-term financing questions to be answered next month.

By the time Union farm ministers meet again in Luxembourg on 28 October, they will already have virtually committed themselves to paying out an additional 500 million ecu in aid, plus medium-term respite for farmers on the intervention side.

This means there will be less pressure on ministers to accept Fischler's proposals for reductions in arable payments to fund beef market reforms, as they will be able to argue that some of the problem has already been solved.

“By allowing intervention to be split off from the package of reform measures, Fischler has allowed one of his major bargaining chips to disappear,” said one lobbyist, speaking after the informal meeting in Killarney. “Ministers are not at all happy with the plans to cut arable payments to pay for the crisis, and they will now feel they have more breathing space.”

But ministers will still have to find a way to generate an additional 800 million ecu next year and a further 1.1 billion ecu in 1998. In the time-honoured tradition of compromise, the latest betting is on a one-year cut in cereal payments with the promise of a review a year later.

After ministers studiously avoided any talk of how the planned changes were going to be financed at their meeting this week, Fischler would only say that “we are going to have to talk an awful lot yet about how to fund the package”.

This week's mass demonstrations at the Killarney meeting, organised by the Irish Farmers' Association, resulted in Fischler having to be helicoptered out of trouble, but met with a cool reaction from the public.

EU farmers' organisation COPA said there were no plans as yet to stage a similar protest at October's crucial meeting of farm ministers. “Our people are very divided because of the difference in regional situations across the Union. Whatever measures are decided must have an impact on consumption as well as production,” said a COPA official.

He welcomed the extra 500 million ecu agreed in Killarney, but stressed that there should not be a major shift in financing from one sector to another.

Increasingly, the crisis is even opening up divisions within that most collegiate of bodies, the Commission itself.

Besides fending off attacks from angry farmers and ministers and taking the UK to task for suspending its selective cull, Fischler last week accused Trade Commissioner Sir Leon Brittan of acting like a “white knight” by attempting to influence British press coverage of the crisis.

Fischler was reacting to press reports, based on briefings by Brittan's staff, which suggested that the Commission had softened its line by agreeing to study the latest statistical study from Oxford University.

This led to articles suggesting that the UK had won a “reprieve” from the Commission.

Fischler said this was likely to be counter-productive, raising expectations in the UK which “neither the Council nor the Commission can meet”, and warned that recent evidence that BSE could be transmitted from cow to calf was likely to prompt calls for a larger rather than a smaller cull.

Reflecting the anger felt by many member states over the UK government's decision to suspend the cull, Fischler described it as a “clear break” with the framework agreed at the Florence summit in June to pave the way for a staged lifting of the ban on British beef exports.