WRITTEN QUESTION E-2689/97 by Klaus Rehder (PSE) to the Commission (1 September 1997)

Subject: Payment of 'grassland premiums'

1. In view of 'Agenda 2000', does the Commission feel able to introduce a special grassland premium?

2. Does the Commission believe this grassland premium can be covered by the newly created dairy cow premium of ECU 215?

3. To what ecological criteria (upper limits on stock, etc.) might this premium be linked?

4. What resources would the European Union have to use to introduce a premium of this kind for the Community?

5. Can individual Member States pay such a grassland premium separately?

Answer given by Mr Fischler on behalf of the Commission (25 September 1997)

1. Within its Agenda 2000 the Commission has proposed to compensate price cuts in the milk and beef sector by headage payments. A forage premium would have the advantage of simplicity, and its use has been thoroughly evaluated. A change to a forage premium would however cause problems of implementation in particular due to an uncertain statistical base compared to the system of headage payments which has already proven its practicability.

The proposed headage payments will however maintain the established links between area and stocking density. In addition, the Commission has proposed to adapt the different mechanisms favouring extensification in order to make them more effective. Proposals made for environmental consideration on less favoured areas payments together with a reinforcement and expansion of the agri-environmental measures will also play an important role in promoting extensive farming practices.

2. The Commission's proposal is to introduce a premium of ECU 215 per dairy cow, which will be composed of a beef premium and a dairy premium. The Agenda 2000 does not propose that this should be paid in the form of a forage premium.

3. Since there is no proposal to introduce a forage premium, ecological criteria have not been defined. Current payments per hectare in less favoured areas are related to stockage density factors. The Commission has suggested a gradual transformation of the related support scheme into a basic instrument to maintain and promote low-input farming systems. Moreover, the agri-environmental measures, where limited forage premium could be paid will be reinforced to compensate farmers for the extra cost of providing services beneficial to the environment. For the beef sector the Commission will reflect on how incentives to extensify can be improved without a major change in the global level of support.

4. Direct income payments caused by reforms of the common market organisations as proposed by the Agenda 2000 are financed under the European agriculture guidance and guarantee fund-guarantee section.

5. Although the Commission has proposed to allow Member States to introduce differentiation criteria on the direct payments according to commonly rules, additional forage premiums at national or regional level are not foreseen in the proposal. It would appear to be possible to allow Member States within an agreed framework to put more emphasis on forage area payments in the framework of the less favoured areas scheme and the agri-environmental schemes programmes, which are both co-financed regimes.