Farm ministers make little headway on reforming the CAP

Date: 17/12/1998

By Myles Neligan

ONLY marginal progress has been made in the ongoing talks over the proposed reforms of the Common Agricultural Policy this year - and very little of what has been achieved was thanks to farm ministers.

Where there have been advances, they have been largely a result of impatient interventions from heads of government and finance ministers, who have been taking an increasingly close interest in a policy area which consumes half the EU budget.

However, the most significant development came in October when the European Commission responded to protests from Germany, Austria, the Netherlands and Sweden over the size of their net contributions to the EU budget by putting forward a plan which would force governments to meet 25% of the costs of the CAP from national coffers.

Although this sparked a storm of protest from the smaller, more agriculture-orientated EU countries, the net contributors welcomed it warmly. Union paymaster Germany is currently trying to persuade France, the most politically influential opponent of this strategy, to come on board. If it is successful, it seems highly likely that some form of agricultural 'co-financing' plan will be in place before the end of 1999.

Meanwhile, farm ministers' negotiations on Agriculture Commissioner Franz Fischler's proposals have dragged on throughout 1998, with few surprises and no breakthroughs whatsoever. In fact, the Council of Ministers' end-of-year report on the reform talks differed little in substance from the account it published 12 months ago.

Then, as now, there is broad agreement on the need to reduce EU guaranteed minimum prices for beef, milk and cereals, but the extent of the price reductions has yet to be settled. Last year's deep divisions over the level of direct aid which farmers will get in order to compensate them for the price cuts are still there.

However, the decision by EU leaders to impose a strict March 1999 deadline for completing the reforms, together with finance ministers' reminder that it is they who control the purse-strings, did at least encourage the farm ministers to isolate the most contentious issues.

Other than the fundamental question of price reductions and compensation levels, which will not be settled until the last minute, these have been identified as the proposed abolition of beef intervention purchasing, the proportion of EU aid to the sector which national governments may spend according to priorities, and the future of the milk quota.

Feature forms part of the European Voice 'Review of the Year'.