Fischer Boel: CAP at risk of collapse

By David Cronin

Date: 02/06/05

Mariann Fischer Boel fears that the Common Agricultural Policy (CAP) may start to unravel. This might be good news to those who regard the CAP as inimical to developing countries and the environment. But to the commissioner for agriculture, it would have negative consequences for Europe. Although she acknowledges that the CAP has an image problem, she points out that farming is one of the main planks of EU integration.

The cause of her worries is the current debate over the EU's spending plans for 2007-13.

During talks on these financial perspectives, the idea has been mooted that the subsidies paid to farmers from the EU budget could be co-financed by national budgets. But Fischer Boel believes this would be the "first step towards abolishing" the CAP.

Accounting for 45% of the EU's 100 billion euro-a-year budget, the CAP is regarded by many as too costly, especially given that the share of agriculture in Europe's economic activity has been on the wane. The Budget Commissioner Dalia Grybauskaite has blamed the CAP for impeding the EU's goal of becoming more competitive.

Fischer Boel denies any suggestion that she is at loggerheads with her Lithuanian colleague. By 2013, she says, the share of farm expenditure in the EU budget would be reduced to 33%. Cuts of a further 9% could be achieved if Romania and Bulgaria - both hoping to join the EU in 2007 - are brought within the limit on farm spending agreed in 2002.

Last month, the Trade Commissioner Peter Mandelson defended the CAP against those who viewed it as the "devil incarnate". Nevertheless, he cited estimates that 75% of EU agricultural subsidies go to farmers with above-average incomes.

Suspicions that the CAP disproportionately benefits the rich were reinforced by the British government's publication of details of subsidy recipients in March. Major beneficiaries included prominent figures in the landed gentry and sugar multinational Tate & Lyle.

Fischer Boel believes the CAP reform package approved by EU governments in June 2003 will help redress the balance. Its aim is to break the link between the amount that farmers produce and the subsidies they receive, as well as to divert greater expenditure to support rural communities and protect the environment. Yet she laments how a proposal by her predecessor Franz Fischler of placing a limit of €300,000 on the amount a single landowner may draw down was rejected by the UK and Germany, countries where large farmers wield significant influence.

So far, the UK, Estonia and Fischer Boel's native Denmark are the only member states to have released details of who gets what from the CAP. Fischer Boel says she would be in favour of having the same transparency across the board, though points out it is a matter for the EU governments to decide on how open they wish to be. "But I do think there will be ongoing pressure on member states to publish these figures," she adds.

For the second half of this year, much of Fischer Boel's attention will turn towards preparations for December's ministerial conference of the World Trade Organization in Hong Kong. Its aim is to ensure a successful conclusion to the Doha round of trade talks and to rewrite the rules of global commerce in a way that will alleviate poverty.

The EU is to come under pressure from developing countries to eliminate the export subsidies it hands out to producers - worth €2.8bn per year. Fischer Boel will not divulge what timeframe she envisages for the phase-out. She also says that other rich countries - principally the US, Canada and Australia - will have to rid themselves of farm support measures if the EU is to reciprocate.

Securing an agreement on sugar will prove difficult, she concedes. Ten countries - including Italy, Spain, Finland, Greece, Ireland and Hungary - oppose sharp price cuts, fearing they will devastate Europe's sugar industry.

"These are not sweet discussions and I am ready to stand up," she says. "If I do nothing, then I spoil the whole sugar production [for Europe]."

Fischer Boel is determined to take a hands-off approach to another vexed policy area: genetically modified (GM) crops.

Her portfolio restricts her to dealing with the question of co-existence between GM and other crops. She has decided not to propose legislation on this matter but rather to offer guidelines to member states. A law covering the entire EU would not be appropriate, she feels, as different geographical and climatic conditions in members states mean the risk of crops becoming contaminated with GM ingredients (carried by winds or insects) varies.

"I can only encourage member states to start the debate themselves, if it isn't already ongoing. I can see the Commission giving them a Christmas tree but member states will have to decide how to decorate it."

Article outlining the views of the European Commissioner for Agriculture and Rural Development, Mariann Fischer Boel, on the future of the Common Agricultural Policy.