Fischler rejects CAP ‘big bang’

Date: 09/11/1995

By Michael Mann

AGRICULTURE Commissioner Franz Fischler is set to throw down the gauntlet to member states intent on using the prospect of EU enlargement to force further radical reforms in the Common Agricultural Policy (CAP).

He will insist there is “no causal link” between the two in a report to be presented to December's summit in Madrid.

“I am strongly against any suggestion that we must change our policies because of enlargement. When we have decided on a future strategy for our own policy, we can then look at how to carry out enlargement, what its costs are and what the framework will be.”

Fischler will also tell government leaders that the extension of the CAP to applicant countries in Central and Eastern Europe (CEECs) will cost far less than the 38 billion ecu suggested in a leaked report from DGXVI, the Directorate-General for regional policy.

“It certainly won't cost that much, in fact less than half that amount,” Fischler insisted in an interview with European Voice.

The jealously-guarded estimate of the cost will form part of the Commission's White Paper on agriculture and enlargement, which Fischler promised would be presented to Commissioners “in the coming weeks”.

His comments give a firm indication of the Commission's preferred approach to the evolution of EU farm policy.

As a first stage, prices on the internal market would have to be reduced to much nearer world market levels. Payments to farmers would be further removed from production factors, probably being based on other - mainly environmental - criteria.

The Commission will avoid turning support into a social safety net, but will suggest a more general policy for rural areas, building on the approach of the CAP reform's “agri-environmental measures” and the LEADER programme which makes up part of the structural funds.

While Fischler's comments suggest he may have moved away from his earlier insistence that there should not be a ceiling on aid to individual farmers, he stated firmly that compensation payments such as those introduced in 1992 - the so-called Green Box aids - should remain untouched by any future world trade accord.

“The Green Box is the basic core of the whole system and things like this which are vital for Europe should be left out of GATT obligations. I cannot imagine them being affected,” he said.

Fischler said the White Paper would contain a range of options on how the CAP could look in the future, ranging from “the solution favoured by the UK to solutions where everything remains unchanged”.

According to officials, the paper will also look at short term measures both sides can take to ease the process of enlargement. Referring to future financial support for Eastern Europe, Fischler commented: “I could hardly imagine giving more support to those who maintain old communist structures than to those people who have the courage to set themselves up as private farmers.”

Trying to douse the controversy generated by his speech in Bonn last month, Fischler stressed that he had merely wanted to make people wake up to the pressures which the EU would face as a result of the GATT agreement.

The Commissioner was very careful not to commit himself to further price reductions, but stressed that “we must prepare ourselves in case markets develop unfavourably. What alternative do we have? The gap between EU and world prices must fall.” There would be no “big bang”, but a long-term evolution, Fischler stressed.

He was unforthcoming about whether the Commission would be forced into paying increased compensation to farmers if prices were cut. The key was to separate income policies more fully from price policies. “I don't think we should take away their income, which is worse anyway than in many areas of the economy.”

His preferred option will be to base payments on the achievement of certain non-production related targets, “of an environmental, ecological kind. Such things can no longer be regarded as a chance result of farming practices, but must be integrated into the whole economic process.” Payments should not simply be a social safety net. “We must pay them to do something, not to do nothing,” Fischler insisted.

Fischler says his idea of a “development strategy” for rural areas, encouraging local initiatives and allowing greater flexibility in fitting policies to local conditions, will be particularly important with an eye on enlargement to the east. But the Commission will resist any 'renationalisation' of the CAP.