29. 6. 81 Official Journal of the European Communities NoC 159/27 
Opinion on the Commission proposal on the fixing of prices for certain agricultural 
products and certain related measures (1981/82) 
The text referred to the Committee has been published in Official Journal of the 
European Communities No C 75 of 3 April 1981 and No C 92 of 23 April 1981, 
page 4. 
A. LEGAL BASIS FOR THE OPINION 
On 23 February 1981 the Council referred the abovementioned proposal to the 
Economic and Social Committee in accordance with Articles 43, 47 and 198 of the 
Treaty establishing the European Economic Community. 
B. OPINION OF THE ECONOMIC AND SOCIAL COMMITTEE 
The Economic and Social Committee prepared its opinion on the above matter at its 
186th plenary session held in Brussels on 25 and 26 March 1981. 
The full text of the opinion is as follows: 
THE ECONOMIC AND SOCIAL COMMITTEE, by 48 votes to 27 with 11 abstentions: 
Having regard to the Treaty establishing the 
European Economic Community, and in particular 
Articles 43, 47 and 198 thereof, 
Having regard to the request made by the Council of 
the European Communities on 23 February 1981 for 
an opinion on the Commission proposals on the 
fixing of prices for certain agricultural products and 
on certain related measures (1981/82), 
Having regard to the decision taken by its Chairman 
to instruct the Section for Agriculture to draw up an 
opinion on this matter, 
Having regard to the Committee's previous opinions 
on this subject, 
Having regard to the opinion issued by the Section 
for Agriculture at its 223rd meeting held on 18 March 
1981 (meeting of 26 March 1981), 
Having regard to the oral report made by the 
Rapporteur, Mr Schnieders, 
Having regard to the discussions at its 186th plenary 
session, held on 25 and 26 March 1981, 1. General comments 
1.1. The Committee notes that the Commission has 
submitted proposals which endeavour to: 
— help improve market balance; 
— take the income situation of farmers into 
account; 
— take the general financial situation into 
account. 
1.2. The Commission's analyses show that the 
market situation has eased, while at the same time 
there has been a considerable slowdown in the 
growth of expenditure. 
1.3. On 11 December 1980 the Commission 
submitted the document 'Reflections on the 
Common Agricultural Policy'; this was the result of 
the mandate conferred on it by the Council on 30 
May 1980, namely to put forward, before the end of 
June 1981, its views on the future development of 
Community policies, without calling into question 
the common financial responsibility for these 
policies, which are financed from the Community's 
own resources, or the basic principles of the CAP. 
HAS ADOPTED THE FOLLOWING OPINION The Committee will endeavour to give its views on 
these questions in due course. 
No C 159/28 Official Journal of the European Communities 29. 6. 81 
2. Incomes and price levels 
2.1. The Committee endorses the Commission's 
analysis of farm incomes; this shows that: 
— in 1980, in all the Member States, agricultural 
incomes fell on average by about 9% in real 
terms, despite the fact that the Council was 
induced to increase the Commission's initial 
proposals: 
— the substantial fall in real farm income in 1980 
followed a smaller fall in 1979 and three years of 
moderate price increases despite considerable 
cost inflation. 
2.2. The Committee considers that the 1981/82 
common prices must be high enough to check the 
slump in farm incomes (which has reached a point 
where it is intolerable) and to take account of the 
specific needs of the stock and crop sectors). 
2.3. The effect on income levels of the 
Commission's proposals is considerably weakened 
by the fact that the Commission is proposing lower 
increases for intervention prices than for guide or 
target prices. On the other hand, the Committee 
observes that the increase in target and guide prices 
will lead to higher protection at the Community's 
external frontiers, which will have a positive impact 
on farm incomes. 
2.4. The lack of a common economic and monetary 
policy makes it more difficult to implement a policy 
of common agricultural prices. 
In countries with strong currencies and positive 
MCAs the proposed price increases will be 
substantially smaller because of the reduction in the 
MCAs. Indeed, the proposed reduction of 5 points in 
the UK and German MCAs would result in a fall in 
the nominal price of some products in those 
countries. 
As a result of the introduction of the European 
Monetary System countries with weak currencies and 
relatively high inflation rates, have little scope for 
raising common prices in their national currencies 
because the negative MCAs are being phased out. 
2.5. The Committee calls on the Commission to 
find solutions to these difficulties. 2.6. The Committee shares the Commission's 
concern to re-establish as soon as possible the unity 
of the agricultural markets, which has suffered over 
recent years from the divergent economic and 
financial policies of the Member States. 
The phasing-out of positive MCAs will therefore 
have to be carried out without harming the producers 
concerned. 
According to the Commission's own calculations it 
would seem that the incomes of farmers in strong-
currency countries have risen less than the 
Community average over recent years. 
It should also be realized that inadequate price 
increases could encourage several Member States to 
take national action, with all its consequences for the 
future of the Community. 
2.7. The Committee reiterates the opposition to 
national measures which it has repeatedly 
expressed. 
2.8. The Committee would point out that the 
measures now proposed mean that the Community is 
calling into question those compensatory measures 
decided on only a year ago to help the Community's 
Mediterranean regions. The Committee cannot go 
along with this development. 
2.9. In view of the above considerations the 
Committee believes that an increase in prices greater 
than that proposed by the Commission is compatible 
with the justifiable restraints imposed by the budget 
and with the need to dispose of Community produce 
on the domestic and external markets. 
In fact a substantial reduction in EAGGF 
expenditure can be expected on account of (a) the 
probable trend of the agricultural markets as 
analyzed by the Commission and (b) the expected 
streamlining of expenditure, especially in the sugar 
and dairy products sectors. 
2.10. The Committee fully realizes that the problem 
of EAGGF funding must be taken seriously. It 
would, however, be wrong to consider EAGGF 
expenditure in isolation. Pruning of EAGGF aid may 
well substantially increase the strain on national 
budgets. For instance, the cost of unemployment 
benefit will spiral if more and more farmers are 
29. 6. 81 Official Journal of the European Communities No C 159/29 
forced by price and incomes structures to give up 
farming or to shed labour. 
3. The co-responsibility principle 
3.1. For a long time and on many occasions the 
Committee has argued that producers should share in 
the cost of reducing surpluses so as to establish a 
balance between supply and demand. 
The Committee is therefore prepared to examine any 
proposal by the Commission along these lines, 
although lack of time prevents it from doing this now. 
This is why it is not able to give its views on the 
different forms of co-responsibility envisaged by the 
Commission for various agricultural products. 
3.2. However, the Committee considers it essential 
to ensure that the higher price increases which it 
advocates do not prejudice the need to strike a 
balance between agricultural production and market 
outlets. 
3.3. Apart from the sectors for which there is 
already some form of co-responsibility (dairy 
products, sugar, wine) the general extension of co-
responsibility raises a number of questions which 
must be answered before a sound opinion can be 
expressed, for instance: 
— what would be the effect on farming in the 
Community, given the various structural, social 
and technical differences which exist? 
— what would be the effect on productivity? 
— what would be the effect on the level of 
surpluses? 
— can producers who are 'responsible' for certain 
surpluses and producers who are not responsible 
be treated in the same way? 
— what impact will co-responsibility have on the 
prices which processors in general and the animal 
feed industry in particular, pay for their raw 
materials? After all, animal feed is both an 
agricultural end product and one of the major 
items used by farmers? 
— should we be working towards a uniform system 
of co-responsibility or towards a specific system 
for each product? 
— what would be the effect of general co-
responsibility on consumer prices? — what would be the cost and administrative 
requirements for the various solutions 
proposed? 
For this reason the Committee considers that the 
situation described by the Commission requires 
study in detail, which is not possible before the 
deadline for this year's price fixing. Therefore the 
Committee reserves the right to come back to this 
important issue later when it can give it all the 
attention which it deserves. 
4. Comments on individual products 
4.1. Milk 
Increased sales of dairy products on the world 
market have eased the situation. An increase in 
market pressure is not excepted during the rest of 
1981. The same level of sales on the world market, or 
a slight increase, would mean a substantial reduction 
in the drain on the EEC budget (probably DM 1 000 
million less than in 1980). 
The proposed additional levy is not suitable for 
persuading producers to adapt to changing market 
conditions. The additional levy would raise the total 
levy paid by milk producers in many areas which 
cannot switch to other forms of production, 
grassland areas in particular, to 4—6% of total 
revenue. On the other hand there would be no 
additional levy in areas where there was no increase 
in the total quantity of milk delivered to dairies. 
Experience over recent years has shown that a 
blanket levy is not a suitable way of adjusting 
production to market conditions. 
The Committee urges the Commission to draw up 
contingent provisions which can be implemented if 
the predicted trend on the milk market does not 
materialize. Last year the Committee pointed out that 
it is administratively difficult for the EEC 
Commission to monitor farms individually and that 
without the help of the dairies such monitoring 
cannot succeed. Therefore the Commission must lay 
down clear guidelines for the way in which any 
supplementary levy is to be collected. The imposition 
arrangements should take account of social and 
economic repercussions, especially for family farms 
— possibly by exempting specific quantities from 
any additional levy. 
No C 159/30 Official Journal of the European Communities 29. 6. 81 
4.2. Rice 
In view of its importance, Community production of 
long grain rice must be given preferential 
treatment. 
4.3. Cereals 
The proposed stiffer definition of minimum qualities 
will not improve marketing nor is it necessary for 
ensuring that the market is supplied. The Committee 
regrets that no measures have been proposed for 
clamping down on imports of cereal substitutes. The 
increasing import of cereal substitutes has a 
substantial effect on EAGGF expenditure. In 
particular the Commission could raise the levies on 
molasses and waste products used in cereals 
processing. Use should be made of this power. 
The Committee would also urge that the power 
conferred on the Commission by the Council to curb 
manioc imports be extended to similar products 
coming under the same tariff heading. 
4.4. Durum wheat 
In view of the demand for durum wheat the 
Committee sees no reason why the increase should be 
less than for common wheat and asks that the guide 
and intervention prices be increased by the same 
amount as those for common wheat; furthermore, 
durum wheat is not a product in surplus and its 
production plays an important economic and social 
role in the depressed areas of southern Italy. It is also 
necessary to bring forward the marketing year to 
1 July. 
4.5. Colza seed, oilseeds and olive oil 
The Committee would point out that last year it 
asked the Commission to make proposals for 
establishing an overall Community policy towards 
the fats and oils sector. 
In view of the present need to import olive oil there is 
no justification for raising the intervention price less 
than the production target price. Production aid too 
must be stepped up by the same percentage as the 
target price. 4.6. Beef and veal 
The Committee believes that preferential agreements 
with third countries and the running down of market-
regulating instruments have lowered incomes in this 
sector. Therefore the proposed measures, whereby 
intervention buying will be confined to the meat of 
male animals only and for seven months of the year 
to forequarters or hindquarters only, are regarded as 
inappropriate. The Committee calls for a better 
export policy for beef and veal, in particular an 
extension to six months of the advance fixing period 
for refunds. 
Lastly, the Committee wishes the calf birth grants to 
be retained since the Italian animal husbandry 
problems which made this measure necessary have 
not yet been overcome. 
The Committee approves the additional measures 
envisaged by the Commission to assist Irish 
farmers ('), who are currently contending with 
particulary serious problems. It observes that these 
measures, for a given period, are compatible with the 
ones it advocates under paragraph 2.5 of this opinion 
in connection with assisting countries where cost 
increases are running far ahead of the Community 
average. Though it acknowledges that such measures 
are helpful, the Committee stresses that they can go 
only a short way towards solving the difficulties of 
the farmers concerned as the funds earmarked for 
this purpose are limited. 
4.7. Fruit and vegetables 
Expenditure on fruit and vegetables has risen mainly 
because the European Community has not taken any 
effective steps to ensure Community preference in 
this sector. The reference price has not been raised in 
line with the rise in costs and nothing has been done 
to control the quality or quantity of imports from 
third countries. The Committee notes that aid for the 
processing of fruit and vegetables was introduced to 
offset the lack of any rules on competition from third 
countries. Any limitation of that aid to specific 
quantities of community output would imply the 
abandonment of that principle and a clear 
disadvantage for Community products vis-a-vis third 
countries. The Committee would point out that there 
are no minimum quality requirements for imports 
from third countries. In the past the substantial rise in 
expenditure in this sector has been due to spiralling 
imports from third countries. 
(i) OJ NoC92, 23.4. 1981, p. 4. 
29. 6. 81 Official Journal of the European Communities NoC 159/31 
new proposals designed to strengthen the contractual 
system based on inter-trade agreements. 
However, it cannot accept the Commission's 
proposal to cut producers' guarantees unilaterally by 
reducing the ratio between the intervention and 
guide prices to 85 % without offering any corrective 
machinery to maintain incomes as provided for in 
the eighth indent of Article 13 of the parent 
Regulation. 
And this for a crop which covers barely 45 % of the 
Community's needs and provides work for people in 
the most disadvantaged Mediterranean areas of the 
Community. 
The Chairman 
of the Economic and Social Committee 
Tomas ROSEINGRAVE 
ANNEX 
The following members or their proxies voted for the opinion: 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr Ammudsen 
Bernaert 
Berns 
Blasig 
Breitenstein 
Buckton 
Broicher 
de Caffarelli 
Chronopoulos 
Clavel 
Curlis 
Daul 
de Bievre 
de Bruyn 
de Tavernier 
Emo Capodilista 
Friedrichs 
Georgiou 
Gingembre 
van Greunsven 
Hennig 
Jakobsen 
Karakitsos 
Kazazis Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mrs 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr 
Mr Kenna 
Kolymbas 
Lane 
Lauga 
Laur 
Leo 
Laughrey 
Marvier 
Morselli 
Paggi 
Papadopoulos 
Patterson 
Pearson 
de Precigout 
Rainero 
Rizos 
Rollinger 
Saitis 
Scharrenbroich 
Schnieders 
Staratzke 
Ventejol 
Wick 
Zunkler 4.8. Wine 
The serious crisis which has existed in this sector for 
years, particularly in the Mediterranean regions, 
requires more resolute action to be taken at 
Community level than that taken so far. The aim 
should be, among other things, to ensure genuine 
freedom of movement in all Member States and 
encourage exports on the world market, as is done 
for other products. 
4.9. Tobacco 
As far as this sector is concerned, the Committee 
approves the Commission's intention to bring out 
Done at Brussels, 26 March 1981. 
No C 159/32 Official Journal of the European Communities 29. 6. 81 
The following members or their proxies voted against the opinion: 
Mr Basnett 
Mr Blamoutsis 
Mrs Bredimas 
Mr Chappie 
Mrs Clark 
Mr Dassis 
Mr de Grave 
Mr Douros 
Mr Drain 
Mr Etty 
Mr Glesener 
Mr Hilkens 
Mr Houthuys 
Mr Jaschick Mr Loccufier 
Mr Loebl 
Mr Milne 
Mr Muhr 
Mr Piga 
Mr Pronk 
Mr Ramaekers 
Mr van Rens 
Miss Roberts 
Mr Savini 
Mr Wagenmans 
Mrs Weber 
Mr Williams 
The following members or their proxies abstained: 
Mrs Engelen-Kefer Mrs Strobel 
Mr Murphy Mr Theisen 
Mr Nierhaus Mr Vanni 
Mr Ognibene Mr Zinkin 
Mr Schneider Mr Zoli 
Mr Seydaack 
ANNEX 
to the opinion of the Economic and Social Committee 
A. Rejected amendments 
The following amendments which were submitted to the Section Opinion in accordance with the 
Rules of Procedure were rejected. 
Replace the entire text of the Section's Opinion (Chapters I, II, III and IV) by the 
following: 
' 1. The Committee notes that in its proposal, 
(a) the Commission, rather than confining itself to the fixing of prices, attempts to give 
the Common Agricultural Policy a fourth principle through the introduction on a 
general scale of the co-responsibility levy system: by doing so it lays major, limiting 
and distorting conditions on the CAP's reform. According to the Decisions of the 
Council of Ministers, this reform is supposed to be the subject of a specific study of 
the Commission within the framework of its general work on prospects for the 1980s. 
Indeed the Commission is supposed to submit proposals by June 1981. In the 
meantime the Economic and Social Committee has committed itself to preparing 
own-initiative opinions on the subject; 
(b) the Commission insists on proposing measures that would have particularly punitive 
effects on the poorest farmers, thus aggravating the major imbalances that exist 
already and thereby putting itself at loggerheads not only with the letter and spirit of 
the Treaty but also with its frequently-stated intention of taking action to reduce the 
gaps between the richest and poorest farmers of the Community; 
29. 6. 81 Official Journal of the European Communities No C 159/33 
(c) The Commission has in particular not consistently followed up any of the serious 
suggestions made in the document entitled "Reflections on the Common Agricultural 
Policy" on ways of reducing imbalances (COM (80) 800 final). 
2. The Committee rejects the proposal under discussion and calls on the Commission to 
re-examine the question and put forward a new proposal on farm prices. This new 
proposal should not set prices higher than the generous increases already agreed for 
1980/81, and only in the following marketing year should proposals be put forward on 
ways of reforming the CAP. These later reform proposals, however, will have to cover all 
sectors — including milk and sugar — which have already been the subject of 
inappropriate co-responsibility measures in 1980/81.' 
Reasons 
These are self-evident from points 1 (a), (b) and (c) of the amendment. 
Voting 
For: 32, against: 51, abstentions: 11. 
Add the following to point 1.1: 
'On the other hand, the Commission has not in all cases taken care to ensure that its Decisions 
on farm prices result in supplies reaching consumers at reasonable prices as required under the 
Treaty. The rises in consumer prices are higher than the price increases for farmers. At a time 
when many workers are suffering a decline in their real incomes and the competitiveness of 
European firms is in jeopardy, it is important to consider how to reduce as much as possible 
the repercussions on purchasing power of the increases that are necessary to maintain incomes 
in the farm sector at an acceptable level. The Economic and Social Committee asks the 
Commission to take account also of the case for maintaining reasonable consumer prices in its 
future price proposals.' 
Voting 
For: 36, against: 41, abstentions: 15. 
Add the following point 1.1.A: 
'Features of the European economy today are the growing number of sectors in difficulties 
and the increase in government aid to these sectors which also have problems in finding 
outlets. 
These aids help to slow down the loss of jobs, depending on the funds made available. It is 
impossible to deal with the cost of the CAP (budget cost, price protected from international 
competition, to be paid by the consumer) without bearing in mind that other sectors too 
require government aid which means a charge on GDP. 
The Economic and Social Committee thinks that the Commission should reflect on the 
inevitably limited share of GDP that can be devoted to supporting sectors with market 
problems and on how this share can be apportioned among the sectors.' 
Voting 
For: 28, against: 57, abstentions: 6. 
Page 2, point 1.2: 
'Delete.' 
Reasons 
This debatable comment on the short-term situation disrupts the link between points 1.1 and 1.3, 
both of which relate to the long-term perspective. 
Voting 
For: 20, against: 54, abstentions: 8. 
No C 159/34 Official Journal of the European Communities 29. 6. 81 
Point 1.3: 
Add the following after the first paragraph: 
'The Committee insists that the Commission's proposals on this subject must lead, in the 
course of this year, to adjustments of the CAP in respect of market equilibrium and 
distribution of income. The fixing of higher prices for farm products can be accepted only if 
this matter is clarified in the near future. 
The Economic and Social Committee will endeavour to give its views on these questions in 
due course.' 
Reasons 
The price proposals must be seen in relation to the long-term targets. 
Voting 
Overwhelmingly rejected. 
Point 2.4: 
'Delete the second and third paragraphs.' 
Reasons 
The relationship between monetary policy and agricultural is highly complex and one cannot just 
mention several aspects at random here. 
Furthermore, the third paragraph (on page 4) is incorrect because devaluations have occured (e.g. 
the recent devaluation of the Lira) and it is quite possible that there will be others in the 
future. 
Voting 
For: 22, against: 49, abstentions: 9. 
Point 2.6: 
'Delete the second and third paragraphs.' 
Voting 
For: 22, against: 41, abstentions: 9. 
Point 2.6: 
'Delete second paragraph.' 
Reasons 
The dismantlement of positive MCAs is presumed to be justified in itself, since it removes an 
unjustified average, so why should there be no compensation? 
The same problem arises — who is to pay for this compensation? 
Voting 
For: 27, against: 33, abstentions: 7. 
Point 2.9: 
1. Replace the first paragraph by the following: 
'In the Committee's view, an increase in prices greater than that proposed by the 
Commission would be unacceptable. Also, a precondition here is that implementation of 
these proposals is compatible with the justifiable constraints imposed by the budget.' 
2. Add, as third paragraph of 2.9: 
'The Committee thinks that the proposed price increases must not divert attention from the 
need to achieve a balance between the production of and the demand for agricultural 
produce.' 
29. 6. 81 Official Journal of the European Communities No C 159/35 
Point 3.2: 
This point can therefore be deleted. 
Voting 
For: 17, against: 50, abstentions: 4. 
Point 2.9: 
Amend to read as follows: 
'In view of the above considerations the Section believes that in general the price increase 
proposed by the Commission is compatible with the justifiable constraints imposed by the 
budget.' 
Voting 
For: 17, against: 54, abstentions: 2. 
Section HI 
Replace by the following text: 
'3.1. The Economic and Social Committee has over a long period repeatedly called for a 
certain sharing by producers in the cost of disposing of surpluses, with the aim of achieving a 
balance between supply and demand. 
The Section is thus prepared to make a constructive appraisal of any relevant proposal by the 
Commission. It has not been able to make a full appraisal at present owing to lack of 
time.' 
Voting 
For: 22, against: 50, abstentions: 6. 
Point 3.2. should read: 
'The Economic and Social Committee fully agrees with the close link the Commission makes 
in its proposals between restricting production in the case of surplus products and proposals 
for price increases. Measures to regulate production are at all events necessary.' 
Voting 
For: 20, against: 50, abstentions: 8. 
Delete point 4.1. 
Reasons 
It is not possible to constantly defer the solution of urgent problems by rejecting every remedy 
without proposing anything positive in its place. 
The Commission proposal could be a good point of departure for rehabilitating the milk sector. It 
could be agreed to at least for a trial period of one year, until the next price proposals. 
Voting 
For: 26, against: 44, abstentions: 4. 
B. The following passage of the Section Opinion was replaced by an amendment 
"The Section urges the Commission to put forward suitable Community measures for those 
countries where cost increases are running far ahead of the Community average.' 
Voting 
For: 45, against: 6, abstentions: 12. 
No C 159/36 Official Journal of the European Communities 29. 6. 81 
C. The following passage of the Section Opinion was withdrawn following the adoption of an 
amendment 
'The Commission had proposed an average increase in prices of 3% for 1980; the Council 
decided on 4-8%. 
Therefore, if the Commission's proposals had been accepted last year the present situation 
would have been worse.' 
Voting 
Carried unanimously.