WRITTEN QUESTION E-0704/96 by André Laignel (PSE) to the Commission (26 March 1996)

Subject: Upper limits for compensation aid under the common agricultural policy

Last year, the income of some producers of arable crops increased substantially as a result of extremely good economic conditions, which did not call into question the level of compensation aid under the 1992 reform since such aid is not actually classed as deficiency payments. Over-compensation has occurred as a result.

This situation has, moreover, been accentuated by a series of changes - often called simplifications - under the reform, such as the 1993 increase in withdrawal compensation, the right to grow crops intended for the agro-food industry on set-aside land, and single rates for set-aside. The result is that a small category of wealthy producers, often based in the rich regions of Europe, receive the bulk of European subsidies and grow disproportionately, devitalizing the countryside by intensive farming which does not respect the environment or the requirements of regional planning.

This is, naturally, incomprehensible to the vast majority of low-income farmers in the Union and to those who are concerned by the fact that Europe is not more generous to other sectors such as the meat, fruit and vegetables and wine sectors, whose reform is long overdue and which are more exposed to external competition exacerbated by a proliferation of free trade agreements.

This unequal distribution of aid is becoming politically unacceptable for all citizens, taxpayers and consumers of the Union, who are somewhat unenthusiastic at present about the idea of Europe but who might support it more if aid for agriculture were more fairly distributed so that it could meet its objectives and benefit all concerned.

Awareness of aid which can reach colossal sums is, finally, intolerable in the eyes of those excluded from national and European solidarity.

In this context, does the Commission plan, in the very short term and preferably during the debate on prices, and in accordance with the adoption of the resolution on 15 February 1996 (B4-0137/96) on the prospects for the CAP, to set upper limits for direct aid per holding or to begin a system of deficiency payments, since the year ahead seems once again to be favourable for those who, last year and in the past, have benefited far more than others from solidarity.

Answer given by Mr Fischler on behalf of the Commission (2 May 1996)

The Commission is aware that prices have been buoyant on the world and Community grain market in the past year or so, a trend largely attributable to prevailing weather conditions, reflecting, albeit to a marked degree, a pattern inherent in any agricultural sector.

It is as yet too soon to make radical changes to the arrangements for the major cereal crops introduced after the 1993 harvest, but the Commission is aware that the challenges facing the Community in the remaining years of this century call for a thorough rethink of agricultural policy as a whole. Without shackling the development of agriculture, it has to be reconciled with the exigencies of environmental and regional development policies. At the same time not only is the Community preparing to take on new members from Eastern Europe, but a further expansion and liberalization of international trade is inevitable to cope with ever-increasing demand.