WRITTEN QUESTION P-2914/97 by Sirkka-Liisa Anttila (ELDR) to the Commission (5 September 1997)

Subject: Preparation, in the review of EU agricultural policy, of special measures called for by northern agriculture with a view to preserving farmers' motivation to work and their satisfaction with farming as a livelihood

The EU's agricultural policy review 'Agenda 2000' stresses above all the importance of permitting the enlargement of the EU and promoting the export on the global market of agricultural products from EU countries with intensive production capacities.

The content of this review was a great disappointment to farmers in the northern region, because it does not take sufficient account either of the objectives of environmental protection and sustainable development or of the special conditions of northern agriculture. If put into practice the review would mean in Finland a complete loss of profitability for cereals production and the total disappearance of the spirit of enterprise. A drop in the intervention price for grain would mean a corresponding drop in the production price to near world market price levels. In Finland it will never be possible to produce cereals at the world market price in view of our climatic growing conditions. As a result of our low level of yield, our variable production costs stand at between FIM 0.90 and 1.00 per kg, which is not covered even by the EU's current producer price, let alone the price level proposed in Agenda 2000.

It is essential that the producer price should be able to cover the variable production costs, because otherwise, in producing food, farmers will be merely eating their own subsidies, which is a complete waste of effort. Commissioner Fischler has frequently said in our debates that he is well aware of Finland's low yield, high producer costs and low producer price which does not even cover costs, and that this makes a difficult equation. I would therefore ask the Commission to take concrete action to prepare special measures so as to enable the farming way of life in the EU's northernmost Member State, particularly in arable farming, to continue to provide the satisfaction of running a business and the motivation to work. The proposal in Agenda 2000 would increase still further the proportion of direct support in farming, thus taking away an essential precondition for the existence of Finnish agricultural production. In view of the excessively low producer price, it would prevent farmers from using the income they receive from the markets to cover the variable production costs, and this would in turn negate the whole purpose of farming.

Answer given by Mr Fischler on behalf of the Commission (26 September 1997)

The Commission shares the Honourable Member's views regarding the importance of maintaining viable economic and agricultural activities in order to ensure the future of rural society.

The proposed reforms concerning agricultural and rural policy set out in Agenda 2000 ((Doc. COM (97) 2000. )) are not confined simply to reducing administrative prices and providing compensation. The Commission is proposing a coherent strategy for rural and regional development and is giving itself the means of implementing that strategy. In this connection it also proposes strengthening agri-environmental measures.

In line with the Honourable Member's wishes, this should enable the requisite measures to be devised in partnership with a view to preserving rural areas like those in the Community's northernmost regions, which could be faced with special difficulties.