WRITTEN QUESTION E-2639/99

by Alexandros Alavanos (GUE/NGL) to the Commission

(12 January 2000)

Subject: Commission proposals on the COM in cotton

For many years cotton production in Greece has been overshooting the guaranteed national quantity of 782 000 tonnes, resulting in large fines being imposed and producers' incomes being drastically reduced.

In the Commission's new proposals for the modification of the cotton regime, not only do the level of the guaranteed quantity and the total expenditure allocated from the Community budget (EUR 770 million) remain unchanged but a further increase in co-responsibility is suggested, supposedly because of overrunning of the annual budget.

Cotton is one of Greece's chief crops (approximately 450 000 hectares; over 200 000 families employed in primary, secondary and tertiary production; high levels of investment) and, at the same time, there is a significant shortfall in this product in the EU.

In the light of the above:

1. Does the Commission intend to re-examine its proposals with a view to increasing the maximum guaranteed quantity and the corresponding budget allocation, to tie in with actual production levels?

2. Will it refrain from increasing the deductions applied when the reference quantities are exceeded?

3. Will it take steps to ensure that small producers of cotton receive the entire aid amount without any deduction for co-responsibility?

4. What other additional measures does it intend to take to support small producers, who are affected particularly severely by the high fines?

Answer given by Mr Fischler on behalf of the Commission

(10 February 2000)

In line with the priorities which, at the time of the agreement on the 1998/99 price package, the Council wished to address when the regime was reviewed, the Commission has proposed a reform of the common organisation of the cotton market.

Whilst making the legislation much simpler, the proposal maintains the status quo as regards the fundamental principle of the aid scheme as constituted by the deficiency payment system and the level of institutional prices and national guaranteed quantities.

Leaving the national guaranteed quantities and, consequently, the maximum guaranteed quantity unchanged is a response to environmental concerns in that it will stabilise the size of the areas cultivated, already limited by the availability of water.

In budgetary terms, current expenditure in the sector, running at more than EUR 900 million, shows that situations may arise which endanger compliance with overall budgetary discipline. Cotton producers, who are at present alone in enjoying total protection against world price fluctuations, must in turn endeavour not to exacerbate the budgetary situation by overshooting their national guaranteed quantities. To this end, the proposed increase in the percentage deduction should help to raise farmers' awareness of their responsibility as regards the total level of production.

Against this background, it would therefore be inconsistent to exempt small cotton producers from the co-responsibility mechanism, nor does the Commission plan to introduce specific support measures for them. The Honourable Member is reminded that the system of fixed-rate aid per hectare for small cotton producers was abolished during the 1995/96 marketing year to put an end to the ineffective and undesirable use being made of Community funds at the time. However, those funds were incorporated in the overall budget currently allocated to the sector.