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Simplifying the Common Agricultural Policy?

[Monday 09 October 2006]

THE European Union's Common Agricultural Policy is notoriously difficult to understand, yet it consumes billions of euros that many members - including the UK - think could be better spent and causes more bickering amongst member states than any other subject.

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EU attempts to simplify CAP

It has been in being for half a century but there are perhaps only a handful of people in Europe who understand it: certainly, it has been a source of confusion and anger to British farmers since we joined the Common Market more than 30 years ago.

There are even some cynics - like the Daelnet Countryside commentator John Sheard - who believe that the small print of CAP has been made deliberately obscure to hide from ordinary folk the waste, bureaucracy and corruption which swallow billions of our taxes.

In an attempt to cast some light into these dark corners, experts were meeting in Brussels last week to "simplify" the CAP. Any decisions they took, if any won't be known for months or even years, in true Brussels fashion.

But the EU's farm commissioner, Marian Fischer Boel, did take the rare step of issuing a long statement trying to explain their objectives. Because CAP, however boring, has an important impact on many areas of rural life here in the Yorkshire Dales, we publish it here on Daelnet in full:

"The Common Agricultural Policy has a deserved reputation for complexity. That is why it is one of my top priorities to simplify it. This week in Brussels, leading experts on the subject from around Europe will gather to discuss practical ways to cut the administrative burden of the CAP. This will make life easier for farmers, allowing them to get out of their offices and into the fields. It will cut the bureaucratic burden on administrations. In turn, this will mean lower public expenditure and reduced costs for the thousands of European companies linked to the farming sector.

We in agriculture are not operating in a vacuum. Cutting 'red tape' is a major priority for the European Commission of Jose Manuel Barroso, especially in view of our focus on growth and jobs. And as the source of the greatest chunk of EU rules, we are determined to play our part. By its nature, the CAP is complex. It addresses complex problems in a complex geographical setting and is the result of difficult political compromises. But this must not deter us from doing all we can to make it simpler where that is possible.

First of all, we need to be clear about what simplification is not about. It is not about 'scrapping the CAP'. Nor should people think it represents a good opportunity to reopen political discussions where they were unhappy with the result. Most importantly of all, simplification must not undermine our controls over how we spend taxpayers' money.

But there is still much we can achieve. In our current work on this issue, we distinguish between technical and political simplification.

The former is about measures like revising a legal document to make it clearer or streamlining administrative procedures. The latter is about changing underlying policies in ways which make them simpler. For example, we must soon begin a debate about the future of milk quotas. If quotas were to go, this would be an example of political simplification in action.

But even the technical can bring major results. We are currently concluding our work of putting most of the individual regimes governing each agricultural product under one roof - what we call establishing a single Common Market Organisation.

The single CMO will replace 21 at present and allow the repeal of 35 Council Regulations. It will increase transparency, improve the quality of legal texts and reduce costs for national administrations and companies. I hope to put a proposal for this on the table by December for intense discussion under the German presidency of the Council in the first half of next year.

My department at the Commission has already set in motion an action plan containing 20 proposals for practical changes which can make life easier for farmers, businesses and national administrations without changing fundamental policy.

And on the political side, things are also moving forward rapidly. The reforms we have agreed since 2003 are channelling around 90 percent of direct payments to farmers into the so-called single payment scheme. This simple system replaces the complex web of individual production-linked subsidies. And I hope it will absorb other payments as the reform process continues.

Our Rural Development policy, which I hope will grow further in importance in the years to come, has also undergone considerable simplification for the period beginning 2007.

A single funding, programming, financial management and control framework will replace two funding sources, five programming systems and three management and control systems.

In 2008, we will carry out a "health check" of the CAP to make sure it is working as well as it should. This represents a golden opportunity to make the policy simpler. Set-aside is a good example of the sort of measure I am talking about. Paying farmers to leave land fallow was logical when farmers received subsidies based on production or area planted. It is much less logical in the post-reform era. To abolish set-aside would lift a heavy administrative burden.

Apart from a general review clause, the Commission will also report on the system of cross compliance - the minimum standards farmers have to respect to receive their subsidies - and the consequences of some Member States' decision to leave some subsidies production-linked. Cross compliance is key element in raising taxpayers' support for the CAP, and its main objective of delivering publics goods and services has to be preserved. But I do nevertheless believe that it can be made less burdensome.

We are also convinced that a move towards complete "decoupling" of payments from production would be better for farmers and a lot simpler to manage. Likewise, my recent proposal to prolong the simplified aid scheme in eight countries which joined the EU in 2004 makes perfect sense in terms of simplification. Hand-in-hand with changes we can make in the short-term, we also have to reflect on the CAP's longer-term future, beyond 2013.

One thing is certain, the simpler it is, the better equipped the CAP will be to continue to play its key role in the EU's rural economy. So I welcome the opportunity to get everyone together to debate these issues. The CAP has remained strong by moving with the times. I am convinced it can play a leading role in our drive for simplification."

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