WRITTEN QUESTION E-1162/01

by Charles Tannock (PPE-DE) to the Commission

(19 April 2001)

Subject: Reform of the Common Agricultural Policy

Would the Commission agree that the most obvious deficiency in the Treaty of Nice in terms of its preparing the European Union for enlargement was its complete failure to address the need for thoroughgoing reform of both the Common Agricultural Policy (CAP) and the current distribution of structural funds?

If so, and bearing in mind the extremely thoughtful comments of Commissioner Fischler on the need for urgent reform of the CAP, as well as the calls from a number of senior political figures in both Britain and Germany to this effect over recent weeks, has the Commission considered the advantages of effectively nationalising the CAP so that each country would be free to protect its farmers and rural communities (subject to rules over competition and State aid regarding exports to other EU States) but where taxpayers from some Member States would no longer be required to subsidise the agricultural sectors of other Member States, thus reducing at a stroke many of the problems associated with the entry of large new agricultural States such as Poland to the EU, the high levels of fraud and wasteful subsidy associated with the current regime and reducing considerably the anti-European feeling that has been generated in Britain and Germany, in particular, over the hugely inequitable budget contributions of those countries over a long period of time, largely as a result of the distortions of the Common Agricultural Policy?

Answer given by Mr Fischler on behalf of the Commission

(5 June 2001)

It is the Commission's view that the Treaty of Nice met the tasks that the Intergovernmental Conference (IGC) set itself, namely the institutional preparation of the Union for enlargement. Furthermore, it would have been too early to have had a sound discussion on the further development of two key policies of the Union. This is, nevertheless, an important debate that will have to take place in developing the next financial perspective.

The Honourable Member's question raises three aspects of renationalisation responsibility for policy implementation, budgetary costs and financial control.

In Agenda 2000 the Commission proposed significant changes to the management of the Common Agricultural Policy (CAP). This included greater flexibility for beef premia and modulation. Member States were broadly against the introduction of national envelopes for beef, while the possibility to modulate, i.e. to shift from direct payments to rural development programmes managed at the lowest appropriate level in Member States has been little exploited to date, particularly in Germany. There would therefore currently appear little consensus within the Member States for a significant renationalisation of policy implementation.

The Commission presented in autumn 1998 a report on the functioning of the own resources system(1). In this technical report, the Commission presented the co-financing of agricultural direct payments as one potential option for correcting budgetary imbalances. This possibility along with degressivity of direct payments was discussed in the framework of the Agenda 2000 package. However, neither was applied in the final agreement. It is possible that such a discussion returns in the context of the mid-term review.

As the Court of Auditors has made clear on many occasions, most of the irregularities relating to CAP expenditure take place at a national level. As far as the Community Institutions are concerned, exercises undertaken by the Commission such as Sound and efficient financial management (SEM) 2000 and the scrutiny of the Parliament have helped to greatly improve the probity of European public expenditure.

(1) COM(98) 560 final.